The World Tax Advisor - July/August 2005 (Recent Asia Pacific Developments).
Mondaq Business Briefing › Nbr. 2005, January 2005
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The World Tax Advisor - July/August 2005 (Recent Asia Pacific Developments).
This article discusses international tax developments and has been prepared by professionals in the member firms of Deloitte Touche Tohmatsu.
Contents Hong Kong - Court Rules on Source of Brokerage Company's Income India - Tribunal Rules on Taxability of Service Fees under India-U.S. Treaty / AAR Rules on Application of India - U.A.E. Treaty Japan - 2005 Tax Law Changes Affect Inbound Investment / New Law May Prohibit Japanese Branch Operations of Foreign Companies Macau - Government Restricts Activities of Offshore Companies Philippines - Corporate Tax and VAT Changes Enacted Taiwan - MOF Issues Rulings on Taxation of Foreign Stock Option Benefits / MOF Issues Ruling on Online Transactions Thailand - Court Concludes Marketing Service Fees Not Royalty Payments HONG KONG Court Rules on Source of Brokerage Company's Income The Court of First Instance issued a decision on 1 June 2005 on an appeal from the Board of Review regarding the issue of whether commission income arose in Hong Kong (Baring Securities (HK) Limited v. Commissioner of Inland Revenue). Specifically, the Court examined whether brokerage and marketing income derived by the taxpayer from trading in securities on behalf of Baring group clients on exchanges outside Hong Kong was sourced outside Hong Kong, even when the client was located in Hong Kong or instructions to execute such trades were given to the taxpayer in Hong Kong. The taxpayer appealed its assessment to the Board of Review, which was dismissed on the grounds that the taxpayer failed to prove that the assessment was incorrect and that the income was not Hong Kong source. In appealing further to the Court of First Instance, the taxpayer argued that the Board erred in applying the source principle in determining the source of the income and in concluding that the profits were derived from activities carried out in Hong Kong. Finding...See the full content of this document
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