Hong Kong and France have signed a bilateral comprehensive double taxation agreement (DTA), reports Tax-News.com.
The Hong Kong/France CDTA incorporates the latest Organization for Economic Cooperation and Development standard on the exchange of information for tax purposes.
Under the agreement, double taxation will be avoided as the income taxed in Hong Kong shall be allowed as a tax credit against French tax attributable to such income. Without a CDTA, profits of French companies doing business through a branch in Hong Kong are fully taxed in both places.
Also under the CDTA, Hong Kong airlines operating flights to France will be taxed at Hong Kong's corporation tax rate, says Tax-News.com. Profits from international shipping transport earned by Hong Kong residents that arise in France will enjoy tax exemption under the agreement.
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