Tax

Hong Kong – Tax on Holding Company

Hong Kong - Tax on Holding Company

Holding – tax on holding company Tax in Hong Kong

 

XYZ Limited owns (holding):

 

1) ABC Limited
2) DEF Limited

 

Conditions:

 

XYZ Limited – 0 HKD income

 

ABC Limited – 1mil HKD
DEF Limited – 0,5mil HKD

 

income will be taxed only on the company’s level, right, meaning:

 

ABC Limited – 1mil HKD
DEF Limited – 0,5mil HKD

 

NO for:
XYZ Limited – 0 HKD income

 

For:

- Company formation in Hong Kong

- company formation in BVI

 

 

Singapore – Tax resident or non-resident?

Singapore - Tax resident or non-resident?

If you think about to start your new company and enjoy the tax exemption  in Singapore one of the most important matter is to be recognized by local authority as a Singapore resident (see the another criteria)  or Foreigner living in SG and the shareholder can’t be corporate body.

 

Indicate whether you are tax resident or not
In order to enjoy the Singapore tax exemption status you need to:
- be recognized as Singaporean citizen; or
- Singapore Permanent Resident (SPR) if your home is in Singapore
- Foreigner who is currently working or staying in Singapore for at least 183 days or more in previous year.

When and How to register for VAT in UK

Singapore - Tax resident or non-resident?

What is VAT?
VAT – Value Added Tax is a tax business charge between supplier and customer when supplier supply his goods and services in UK.

 

When to register for VAT
There are a few section which will help you to distinguish which category you suit to. For each of the case there is different rules.
Please kindly chose one of those and find our more on HRMC webpage.
- You are doing business in the UK, or intend to
- You supply goods or services to the UK from abroad, or intend to start
- You supply goods or services from the UK to other countries
- You supply goods or services from another country to another country through UK

 

How to register for VAT
You have several choices one of them is to use our service once you opening the company or visit HMRC webpage for further information.
Which form you use and the number of forms you will need to complete will depend on a few particular circumstances. Online HMRC Service.

 

VAT and International Trade
Visit HMRC webpage for further information on VAT and International trade here.

 

VAT and Internet services
Visit HMRC webpage for further information on VAT and Internet services here.

 

Rates of VAT

Rate of VAT Another term Taxable Supplies
17.50% Standard Rate most of the goods and services
5% Reduced Rate renovation and alteration of dwellings etc.
0% Zero Rate newspaper, books, most food(not meals) etc.*

*Click here to find out more about exempt goods and services.

 

For more information on When to register for UK VAT visit HM Revenue & Customs here.
For more information on Where to register for UK VAT visit HM Revenue & Customs here.

Ireland Corporate Tax Rates

SINGAPORE - Tax Exemption Company - Startup

Rates of Corporation Tax:
- 12.5% for trading companies
- 25 % for non-trading income

 

Starups and exemption
An exemption from corporation tax for the first three years:
- a company incorporated after 14th of October 2008 and has commences to trade
- an exemption from Corporation Tax and capital gains tax on the assets used for the trade
- not relief avaible where profits exceed € 60,000

 

tax relief restriction if; the trade was carried on by another person, the trade was carried on by associated company, trading company carrying on trading with: coal, petroleum, agriculture or another exporting activities.

 

Taxable Profits Year 2011
Profit not exceeding € 40,000 Full exemption
€ 40,000 to € 60,000 Marginal relief
> € 60, 000 Fully taxable

At the current rate of corporation tax i.e. 12.5% this equates to €320,000 of profits per year. Where corporation tax for the period is between €40,000 and €60,000, marginal relief will apply. The maximum amount of corporation tax relief is €40,000 per annum for 3 years.
In addition to the taxation issues you need to consider there are various other practical and legal matters which should be taken into account when setting up a company and on which you should seek professional advice.

 

 

UK Limited Company – Corporation Tax

Singapore - Tax resident or non-resident?

- company incorporated (resident companies) in the UK (or Foreign) is subject to corporation tax at prevailing rates on their worldwide income (capital and ordinary income)
- company being recognized as a branch (non-resident company carrying on a trade in the UK) is taxed on the income of a branch carrying on a business in the UK and on United Kingdom sourced investment income.
- if you nominate yourself as a director, you will need to pay tax on your salary (subject of all incomes derived from company – benefits in kind, dividend income and other income) and operate PAYE and National Insurance.
- from April 2011 – for accounting periods after 31 March 2010 – all Company Tax Returns must be filed online and payment proceed electronically.

 

Once you set up Limited Company:
- inform HMRC about your activity (form CT41G) this form you can find: www.businesslink.gov.uk/ct/start-a-company
-  tax return is supposed to be completed of the end of the accounting period. fill it online at: www.businesslink.gov.uk/ct/online
- fill and pay the corporation tax
- operate PAYE for employee’s as well as for directors’s income

 

Corporation Tax
- pay your Corporation Tax before the deadline to file your Company Tax Return

 

e.g. Lets say your company’s financial year began on 1st of April 2011 to 31st of March 2012, and your accounting period is the same than you have to pay your Corporation Tax for that period by 1st of January 2013 and file your Company Tax Return for that period by 1st of April 2013.

 

Bear in mind, it’s your responsibility to fill and pay all tax returns on the time. Many people choose to use an accountant in order to manage this. You might get a basic help at businesslink.gov.uk.

 

Corporation Tax Rates
Taxable Profits Year 2011
Profit not exceeding £ 300,000 20%
300,001  - 1,500,000 Margin relief fraction 3/200*
On profits over $ 1,500,000 26%

* How to calculate marginal relief please visite HMRC.

SINGAPORE – Tax Exemption Company – Startup

Singapore - Tax resident or non-resident?

Requirements for Tax Exempt Company (0% tax – 100% of S$ 100,000 taxable income):
0% tax for new Startup can claim for first three financial years

 

- must be incorporated in Singapore
- must be a tax resident in Singapore (if the business is exercised in SG)
- can’t have more than 20 shareholders

Tax exemption & partial tax exemption for First Three Years  (in S$)
Financia years Taxable Income Relative expression Tax Rate
1 <0 – 100,000> 100% 0%
next (100,000 – 300,000> 50% 8.50%
next (300,000 – 2,000,000> - 17%

Partial Tax Exemption – 8,5% tax – 50% of an amount >S$ 100,000)
If your Startup doesn’t meet the qualifying conditions under this scheme, your Startup will be given the partial tax exemption status – 50% exemption is given from the chargeable income.
Tax and partial tax exemption – read more here.

Partial tax exemption after First Three Years  (S$)
Financia years Taxable Income Relative expression Tax Rate
after 3 years <0-300,000> 50% 8,5%
after 3 years (300,000 – 2,000,000> - 17%

If the company reports losses or has no income in any of the first three years
- your chargeable income and tax payable will be nil and you can’t enjoy the benefit of exemption scheme for new Startup company. Three years are consider since you
establish your Startup. If you company has not commenced any business for first two
years you have left one year of tax exemption.

 

Income Tax Audit exemption
- number of corporate shareholders is lower than 20 and with annual revenue less than S$ 5,000,000
- dormant companies (without any accounting evidence)

 

Corporate Income Tax Rebate and SMEs Cash Grant

 

Singapore government has realized the need of SME for that reason offers two different cupport (depending on whichever amount is higher):

 

Rebate for a Corporate Income Tax
- Startupr can claims 20% corporate income tax rebate on income tax for financial year 2011 (subject to a cap of S$ 10,000)

 

SMEs Cash Grant
- 5% of the Starupr’s revenue (subject to a cap of S$ 5,000)
read more here.

Do you want to know our pricing policy on Singapore Limited Company? Click.