Henry Kwong Tax - International

25/06/2026

𝐑𝐞𝐥𝐚𝐭𝐞𝐝 𝐩𝐚𝐫𝐭𝐲 𝐭𝐫𝐚𝐧𝐬𝐚𝐜𝐭𝐢𝐨𝐧 𝐚𝐦𝐨𝐮𝐧𝐭𝐬 𝐚𝐫𝐞 𝐬𝐦𝐚𝐥𝐥, 𝐬𝐨 𝐢𝐠𝐧𝐨𝐫𝐞 𝐓𝐫𝐚𝐧𝐬𝐟𝐞𝐫 𝐏𝐫𝐢𝐜𝐢𝐧𝐠 (𝐓𝐏)? 𝐌𝐚𝐧𝐲 𝐜𝐨𝐦𝐩𝐚𝐧𝐢𝐞𝐬 𝐦𝐢𝐬𝐮𝐧𝐝𝐞𝐫𝐬𝐭𝐚𝐧𝐝 𝐭𝐡𝐢𝐬.

Transfer pricing isn't just a problem for big companies
Many bosses say:
"We just charge a little bit internally within the group for service fees, manage some fund flows. The amounts aren't huge. Probably nothing to worry about, right?"
But the reality is, Hong Kong transfer pricing hasn't been "only for very large groups" for a long time.

We worked with a regional management company that had service fee and financing arrangements between its Hong Kong office and overseas related parties. Management felt the company wasn't that large and the HK tax authorities probably wouldn't pay special attention.
But during the annual review, they discovered many thresholds and documentation requirements that simply cannot be judged by gut feeling alone.

What truly needs to be reviewed usually includes:
- Company size
- Types of related party transactions
- Transaction amounts
- Whether Master File / Local File requirements might be triggered
- Whether the group is involved in CbC related arrangements

The biggest risk for many companies isn't lack of business, but failing to organize the logic and documentation beforehand.

When the tax authorities eventually ask questions, you'll find you have to justify why every single related party charge is reasonable.

23/06/2026

𝐒𝐞𝐭𝐭𝐢𝐧𝐠 𝐮𝐩 𝐚 𝐟𝐚𝐦𝐢𝐥𝐲 𝐨𝐟𝐟𝐢𝐜𝐞 𝐢𝐧 𝐇𝐨𝐧𝐠 𝐊𝐨𝐧𝐠 𝐢𝐬𝐧'𝐭 𝐣𝐮𝐬𝐭 𝐚𝐛𝐨𝐮𝐭 𝐫𝐞𝐧𝐭𝐢𝐧𝐠 𝐚𝐧 𝐨𝐟𝐟𝐢𝐜𝐞: 4 most overlooked things about Family Investment Holding Vehicle (FIHV)

FIHV benefits don't come automatically just by setting one up.
Recently, many high-net-worth families are looking at Hong Kong, not just for asset allocation, but also to see if they can integrate family office, tax, and succession planning together.

But the biggest misunderstanding many have about FIHV is:

"As long as I set up a family office in Hong Kong, the tax benefits will naturally follow."

The reality is not like this.

We advised an Asian family. Initially, they just wanted to set up a team in Hong Kong for post-investment management and administrative support.
But after further discussion, they started genuinely caring about: if they manage the FIHV through a Hong Kong single-family office, could the related investment profits potentially enjoy tax benefits?

What truly needs to be considered usually includes:
1. Whether there are sufficient full-time qualified employees in Hong Kong
2. Whether operating expenses in Hong Kong meet requirements
3. Whether the total assets under management meet requirements

So, Hong Kong is friendly towards family offices.

But friendly does not mean automatic.

The more high-net-worth the structure, the more you must look beyond branding and location, at the actual functions and arrangements.

22/06/2026

𝐀 𝐜𝐨𝐦𝐩𝐚𝐧𝐲 𝐰𝐢𝐭𝐡 𝐇𝐊$𝟑𝟎 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 𝐩𝐫𝐨𝐟𝐢𝐭 𝐝𝐨𝐞𝐬𝐧'𝐭 𝐩𝐚𝐲 𝐭𝐚𝐱 𝐢𝐧 𝐇𝐨𝐧𝐠 𝐊𝐨𝐧𝐠? 𝐓𝐮𝐫𝐧𝐬 𝐨𝐮𝐭 𝐭𝐡𝐞𝐲 𝐝𝐨 𝐑&𝐃.

R&D companies, don't miss this tax deduction

When many companies hear about Hong Kong's R&D incentives, their first reaction is:
"Is it that 5% Patent Box?"
Actually, for many growing enterprises, what affects cash flow earlier is often R&D expenditure deduction.

We worked with an industrial software company. The team was continuously investing in R&D in Hong Kong. Initially, they only cared about how future IP income would be taxed.
But upon deeper inspection, they realized that current R&D expenditure itself could also lead to substantial tax savings.

Why is this worth looking at?
Because if it qualifies as eligible R&D expenditure, Hong Kong may offer:
- 300% tax deduction for the first HK$2 million of expenditure
- 200% tax deduction for the excess amount

This is particularly important for early-stage and growth-stage enterprises.
Because this isn't a "benefit you'll only see in the future," but one that could be reflected earlier in the company's tax burden and cash flow arrangements.

Truly mature planning usually doesn't just look at one single incentive.

It looks at front-end R&D investment and back-end IP income together.

16/06/2026

𝐑&𝐃 𝐢𝐧𝐜𝐨𝐦𝐞 𝐭𝐚𝐱𝐞𝐝 𝐚𝐭 𝐨𝐧𝐥𝐲 𝟓%? 𝐓𝐞𝐜𝐡 𝐜𝐨𝐦𝐩𝐚𝐧𝐢𝐞𝐬 𝐬𝐡𝐨𝐮𝐥𝐝 𝐚𝐥𝐥 𝐥𝐨𝐨𝐤 𝐢𝐧𝐭𝐨 𝐇𝐨𝐧𝐠 𝐊𝐨𝐧𝐠'𝐬 𝐏𝐚𝐭𝐞𝐧𝐭 𝐁𝐨𝐱 𝐫𝐞𝐠𝐢𝐦𝐞 𝐫𝐞𝐜𝐞𝐧𝐭𝐥𝐲

Is Hong Kong's Patent Box regime worth paying attention to?
If you are in SaaS, AI, BioTech, or Hard Tech, you've likely been hearing a term more and more frequently lately: Patent Box.

The reason is simple.
Hong Kong's signal this time is clear: not only welcoming businesses to operate in Hong Kong, but also starting to more seriously welcome R&D and IP commercialization landing in Hong Kong.

We worked with a tech company that had always treated Hong Kong as a financing and regional management platform, never seriously considering placing its intellectual property income there.
But after re-evaluation, they started to notice: if it qualifies as eligible IP income, Hong Kong might offer a concessionary tax rate of 5%.

Why is this worth looking at?
Because it affects not just "a slightly lower tax rate," but prompts companies to rethink:
1.Where IP should be located
2.How R&D connects with commercialization
3.Whether Hong Kong can be upgraded from an operations center to an IP center

For tech companies, this is not just a tax issue, but also an issue of business model and IP security.

11/06/2026

𝐖𝐡𝐲 𝐚𝐫𝐞 𝐦𝐨𝐫𝐞 𝐚𝐧𝐝 𝐦𝐨𝐫𝐞 𝐛𝐨𝐬𝐬𝐞𝐬 𝐚𝐬𝐤𝐢𝐧𝐠 𝐚𝐛𝐨𝐮𝐭 𝐇𝐨𝐧𝐠 𝐊𝐨𝐧𝐠 𝐂𝐞𝐫𝐭𝐢𝐟𝐢𝐜𝐚𝐭𝐞 𝐨𝐟 𝐑𝐞𝐬𝐢𝐝𝐞𝐧𝐭 𝐒𝐭𝐚𝐭𝐮𝐬 (𝐂𝐨𝐑)? 𝐓𝐡𝐢𝐬 𝐩𝐢𝐞𝐜𝐞 𝐨𝐟 𝐩𝐚𝐩𝐞𝐫 𝐜𝐚𝐧 𝐝𝐢𝐫𝐞𝐜𝐭𝐥𝐲 𝐢𝐦𝐩𝐚𝐜𝐭 𝐭𝐡𝐞 𝐨𝐯𝐞𝐫𝐚𝐥𝐥 𝐭𝐚𝐱 𝐛𝐮𝐫𝐝𝐞𝐧 𝐨𝐟 𝐜𝐫𝐨𝐬𝐬-𝐛𝐨𝐫𝐝𝐞𝐫 𝐟𝐮𝐧𝐝𝐬.

Why the Hong Kong Certificate of Resident Status (CoR) is becoming more important

Many people, upon first hearing of CoR, think it's just one of many application documents.
But for companies engaged in cross-border investment, shareholding, receiving interest, or receiving royalties, this is often not just an ordinary document, but a key gateway to tax efficiency.

We worked with a mainland enterprise owner who held mainland businesses through a Hong Kong company. Initially, he didn't value the CoR, thinking it didn't matter much.
But after we reviewed the overall structure and treaty benefits together, he realized the CoR could directly affect the tax burden on cross-border dividends and remittances.

Why are more people paying attention to it?
Because it is usually related to treaty benefits under DTA (Double Taxation Agreement).
In practical structures, this can affect:
1. Dividend withholding tax
2. Interest withholding tax
3. Royalty tax burden
4. Cross-border investment returns
But don't misunderstand. CoR isn't about "applying for it automatically grants all benefits."

In many cases, it must be considered alongside requirements like beneficial ownership, business substance, and management control.

So the real question isn't:
"Should I apply for CoR?"
But rather:
"Is my structure worth doing serious CoR planning for?"

09/06/2026

𝐈𝐬 𝐨𝐟𝐟𝐬𝐡𝐨𝐫𝐞 𝐢𝐧𝐜𝐨𝐦𝐞 𝐚𝐥𝐰𝐚𝐲𝐬 𝐬𝐚𝐟𝐞? 𝐏𝐚𝐲 𝐬𝐩𝐞𝐜𝐢𝐚𝐥 𝐚𝐭𝐭𝐞𝐧𝐭𝐢𝐨𝐧 𝐭𝐨 𝐭𝐡𝐞𝐬𝐞 𝟒 𝐭𝐲𝐩𝐞𝐬 𝐨𝐟 𝐢𝐧𝐜𝐨𝐦𝐞 𝐧𝐨𝐰.

The 4 types of income most prone to pitfalls under Hong Kong's FSIE regime

Many bosses used to think:
"If this income is earned overseas and wasn't from a Hong Kong source originally, then there's no problem."

Now, this mindset may need to change.
We worked with an overseas expansion group. The Hong Kong company held overseas investments and received overseas dividends and interest. Management originally believed these were all offshore incomes and simply remitting them to Hong Kong was just a normal transfer.

But under current rules, some income can no longer be judged solely by "source," but also whether it falls under the FSIE regime.
The 4 types of offshore passive income that require the most attention now are:
1.Dividend income
2.Interest income
3.Gains from disposal of assets
4.Intellectual property income

More critically, "received in Hong Kong" isn't as simple as just being credited to a Hong Kong bank account.

If the income is used to repay Hong Kong business debts, or to purchase movable assets subsequently brought into Hong Kong, it may also be considered received in Hong Kong.

So, when structuring today, you can't just ask, "Is it offshore?"
You must also ask:
Who receives it? How is it received? Where is it received? How is it used after receipt?

02/06/2026

𝐂𝐥𝐢𝐞𝐧𝐭𝐬 𝐨𝐯𝐞𝐫𝐬𝐞𝐚𝐬 = 𝐝𝐞𝐟𝐢𝐧𝐢𝐭𝐞𝐥𝐲 𝐨𝐟𝐟𝐬𝐡𝐨𝐫𝐞? 𝐌𝐚𝐧𝐲 𝐇𝐨𝐧𝐠 𝐊𝐨𝐧𝐠 𝐜𝐨𝐦𝐩𝐚𝐧𝐢𝐞𝐬 𝐠𝐞𝐭 𝐬𝐭𝐮𝐜𝐤 𝐡𝐞𝐫𝐞

Offshore profits are not as simple as you think
"Customers aren't in Hong Kong, goods don't enter Hong Kong. Does that definitely mean I can claim offshore status?"

This is a very common misunderstanding among Hong Kong company bosses and CFOs.

We worked with an international trading company. Its customers were in Europe, suppliers in Southeast Asia, and goods never passed through Hong Kong. The boss always believed this was definitely offshore profit.

But after digging deeper, we found that key contract negotiations and signings actually occurred in Hong Kong.
Herein lies the problem.
Hong Kong determines the source of profit not just by looking at where customers are or where goods go. The key point is: Where do the critical activities generating the profit take place?

What typically needs to be considered includes:
1.Where services are provided
2.Where sales contracts are negotiated, signed, and executed
3.Whether operational processes and supporting documents are consistent

Many companies fail not because of their business model, but because of the chain of evidence.

Emails, contracts, process records, and communication habits are often more important than the boss's own judgment.

23/04/2026

The planned structure can slash withholding tax by around 50%, whereas a poor one quietly eats into your returns. We reveal why smart investors keep choosing Hong Kong as their gateway, and how the best holding setups make all the difference.

Curious how this applies to your structure? Contact us for tailored advice.

14/04/2026

𝟎% 𝐒𝐡𝐢𝐩 𝐋𝐞𝐚𝐬𝐢𝐧𝐠 𝐓𝐚𝐱 𝐂𝐨𝐧𝐜𝐞𝐬𝐬𝐢𝐨𝐧 𝐢𝐧 𝐇𝐨𝐧𝐠 𝐊𝐨𝐧𝐠 (𝟗)

Sub-heading: Practical Takeaways for Ship Owners and Lessors
To benefit from the concession, businesses must:
• Meet substance and management requirements
• Maintain proper records and separate tax filings
• Consider restructuring to isolate ship leasing activities
• Seek advance rulings where uncertainty exists
With careful planning, the regime offers both tax efficiency and certainty.

Thinking of setting up or restructuring a ship leasing platform in Hong Kong?
Read the full guide: https://henrykwongtax.com/article/Ship-Leasing-Tax-Concession-in-Hong-Kong

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09/04/2026

Benefits of setting up a holding/trading company in Hong Kong, Offshore claims, DTAs, Transfer Pricing & cross-border strategies — all inside our latest HK Tax Guide.

Swipe through to see key highlights covering:
•⁠ ⁠Profits Tax & Offshore Claims
•⁠ ⁠International Tax considerations
•⁠ ⁠Double Tax Agreements (DTAs)
•⁠ ⁠Transfer Pricing & more

Navigating international tax rules in HK can save you significantly — but it needs to be done correctly.

Comment your email address below or DM us for the full Hong Kong Tax Guide.