Worldwide: RSM Tax Advisory (Hong Kong) Limited - Weekly Alert Issue No. 5 [2017]

Last Updated: 6 February 2017
Article by RSM Tax Advisory

Welcome to issue 5 [2017] of Weekly Alert covering technical development in taxation around the globe.


1. Stamp Duty (Amendment) Bill 2017 Gazetted

The Stamp Duty (Amendment) Bill 2017 was gazetted on 27 January 2017.

The Bill seeks to implement the new demand-side management measure (i.e. introduce a new flat rate of 15% for the ad valorem stamp duty ("AVD") chargeable on residential property transactions, in lieu of the doubled ad valorem stamp duty ("DSD") rates under the existing AVD rates at Scale 1) which took effect from 5 November 2016.

The new flat rate of 15% would be applied to all residential property transactions acquired by individuals or companies, unless specifically exempted (e.g. a Hong Kong permanent resident who does not own any residential property in Hong Kong at the time of acquiring the residential property will continue to pay the AVD under the lower rates). For non-residential property transactions, the existing DSD arrangement would still be applied.

If new residential property is acquired by a Hong Kong permanent resident before disposal of his/her single residential property, the existing refund mechanism under the DSD arrangement will still be applicable for this replacement under the new measure.

The Bill will be introduced into the Legislative Council on 8 February 2017.

Press Release

2. Suspension of Service for Filing of Tax Return – Individuals through eTAX

On 27 January 2017, the Inland Revenue Department ("IRD") announced that the internet filing service for individual tax return will be temporarily suspended from 30 March 2017 in order to facilitate system update. The IRD reminds taxpayers to complete their internet filings on or before 29 March 2017 or file their tax returns in paper form.

Suspension of Service for Filing of Tax Return – Individuals through eTAX


1. Circular on the Bank Account Management Issues for Sole Proprietorships under the "Combination of Two Certificates into One" Registration Reform

(中国人民银行、工商总局关于个体工商户 "两证整合"登记制度改革涉及银行账户管理有关事项的通知 )

The People's Bank of China and the State Administration for Industry and Commerce have jointly issued the "Circular on the Bank Account Management Issues for Sole Proprietorships under the 'Combination of Two Certificates into One' Registration Reform".

With effect from 1 December 2016, the combination of the business license and tax registration certificate for sole proprietorships into one integrated certificate have been officially implemented nationwide.

According to the Circular, sole proprietors can provide their new integrated certificates to their bankers for operating their bank accounts. If the sole proprietors do not have new integrated certificates, they can still use their business license and tax registration certificate for their bank transactions.


2. Circular on Clarifying the Tax Disclosure in Financial Statements

(关于明确财务报表有关税金指标填报要求的通知 )

On 19 January 2017, the Statistical Design and Management Department of the National Bureau of Statistics issued the "Circular on Clarifying the Tax Disclosure in Financial Statements".

After the implementation of value-added tax in lieu of business tax, with effect from 3 December 2016, the original accounting code of "Business Taxes and Surcharges" would be replaced by "Taxes and Surcharges". Property tax, stamp duty, vehicle and vessel use tax, and land use tax which are related to the business operations would be included the new "Taxes and Surcharges" code instead of the "Tax" code under administrative expenses.



1. OECD Releases Peer View Documents for Assessment of BEPS Minimum Standards (Actions 5 and 13)

On 1 February 2017, the Organisation for Economic Co-operation and Development ("OECD") released two documents which will form the basis of the peer review of the Action 5 of the Base Erosion and Profit Shifting ("BEPS") Project on Transparency Framework and Action 13 on Country-by-Country Reporting.

The standards for Action 5 and Action 13 are two of the four BEPS minimum standards. Each of the four BEPS minimum standards is subject to peer review in order to ensure timely and accurate implementation. All members of the Inclusive Framework on BEPS commit to implementing the minimum standards and participating in the peer reviews. These two documents set out the criteria for assessing the implementation of the minimum standard and the procedural mechanism by which jurisdictions will complete the peer review.

OECD Releases Peer Review Documents for Assessment of BEPS Minimum Standards (Actions 5 and 13)

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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