Double Taxation Treaty

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  1. #1

    Join Date
    May 2011
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    101

    Double Taxation Treaty

    I've been trying to read about double taxation but the legalese is so confusing!

    Hong Kong has a Double Taxation agreement with New Zealand. So, what exactly does this mean:

    1) Hong Kong residents who have income from a property or from dividends in New Zealand do NOT need to pay a 30% withholding tax? If so, how do you file tax in HK for this? And, what do you tell the company in NZ? Don't withhold my tax because HK has a double taxation treaty?

    Thanks!


  2. #2

    Join Date
    Aug 2013
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    9

    You do not need to file a tax return in HK for your property in NZ - HK adopts a territorial tax regime i.e. only income sourced in HK is taxable in HK.
    Not sure if that is your question.


  3. #3

    Join Date
    May 2011
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    101

    I may get a dividend payment from an investment in NZ. They withhold dividend payments at a 30% tax rate (as it is income derived from NZ for overseas investors). If HK has a double tax treaty, does that mean I can get a lower withhold tax rate in NZ or are the two different? Does it just mean that I don't get taxed again in HK? Thanks!


  4. #4

    Join Date
    Aug 2013
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    9

    Presumably you are holding the NZ stocks as an individual not a company. If you refer to this, looks like the withholding tax rate should be 15%.

    http://www.kpmg.com/CN/en/IssuesAndI...rt-1012-29.pdf

    Is this an NZ listed stock?

    You won't get taxed in HK as it's not a HK stock.


  5. #5

    Join Date
    Mar 2010
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    6,745

    It is like in the following:'
    You need to file a form and submit to your stock broker bank.
    In that form you state your place of residence, here HK.
    The broker's tax filing agent deducts the dividend tax rate that applies.

    Just download the double tax treaty and see which rate has been stipulated.
    My blind guess is it is less than 30%,
    say 15%.
    So this is the correct tax that the tax withholding agent should deduct.
    This goes to NZ coffers, there is nothing you can do about.
    It does not matter that HK doesnot tax dividends.
    You are lucky, with US there is no treaty, so a full 30 apply, with a few exceptions

    Last edited by Morrison; 04-09-2015 at 11:49 AM.

  6. #6

    Join Date
    Mar 2010
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    In US that form is W 8 BEN and must be renewed every 2 or 3 years