The Avoidance of Double Taxation with respect to Taxes on Income and the Prevention of Fiscal Evasion between Hong Kong and Italy

The Agreement between the Government of the Hong Kong Special Administrative Region of the People’s Republic of China and the Government of the Italian Republic for the Avoidance of Double Taxation with respect to Taxes on Income and the Prevention of Fiscal Evasion signed on 14 January 2013 and has come to in force on 10 August 2015

The comprehensive agreements for the avoidance of double taxation (“CDTA”) between Hong Kong and Italy was signed in January, 2013, in accordance with the signed CDTA, the following withholding taxes will apply:

• Dividends: 10% withholding tax on dividends.
• Interest: 12.5% withholding tax on interest.
• Royalties: 15% withholding tax on royalties.

The Secretary for Financial Services and the Treasury, Professor K C Chan said the CDTA between Hong Kong and Italy will bolster the economic and trade between the two places and offer added incentives for companies in Italy to do business or invest in Hong Kong, and vice versa. Professor Chan also said the entry into force of the CDTA b would help address any concerns on the part of the Italian authorities about Hong Kong’s commitment to enhancing tax transparency and combating cross-border tax evasion, thus facilitating the removal of Hong Kong from the “blacklist” of Italy as early as possible.

The CDTA between Hong Kong and Italy was signed in January 2013 and came into force in August, 2015, after completion of ratification procedures on both sides. It will be in effect in respect of Hong Kong tax for any year of assessment beginning on or after April 1, 2016.

For the details of the Hong Kong, Italy tax treaty in force, please refer to the following Inland Revenue Websites:

http://www.ird.gov.hk/eng/ppr/archives/15081401.htm

http://www.ird.gov.hk/eng/tax/dta_inc.htm