International News

  • Mauritius Announces Company Tax Reforms In New Budget 22nd June 2018
    Mauritius announced wide-ranging changes to its tax regime in its latest Budget, including for companies. The Deemed Foreign Tax Credit regime available to companies holding a Category 1 Global Business Licence will be abolished from December 31, 2018, and a partial exemption regime will be introduced whereby 80 percent of specified income will be exempted from income tax. The exemption will be granted to all companies in Mauritius, except banks, and will apply to foreign source dividends and profits attributable to a foreign permanent establishment, interest and royalties, and income from the provision of specified financial services. The current formula for the Special Levy on Banks, which is scheduled to end by June 2018, will be maintained up to June 2019. The Special Levy on Banks is currently 10 percent of chargeable income for Segment A banking business; and 3.4 percent on book profit and one percent on operating income for Segment B banking business. The Deemed Foreign Tax Credit regime available to banks will be abolished from July 1, 2019. In its place, a new tax regime for banks will be introduced that will make no distinction between Segment A and Segment B income. Income up to MUR1.5bn (USD42.5m) will be taxed at five percent. Income above MUR1.5bn will be taxed at a rate of 15 percent unless the bank satisfies certain conditions entitling it to be taxed at five percent. A five-year tax holiday will be introduced for Mauritian companies collaborating with the Mauritius Africa Fund for the development of infrastructure in special economic zones. The tax holiday will cover investments in infrastructure development in the zones and will benefit project developers and project financing institutions. The solidarity levy on telephony service providers, which was introduced in 2009, will be extended until June 2020, and companies will no longer be required to have profits exceeding five percent of turnover before being liable to pay the levy. An investment tax credit of five percent over three years will be granted in respect of expenditure on new plant and machinery (excluding motor cars) by a company importing goods in semi-knocked-down form on the condition that at least 20 percent local value addition is incorporated. The credit will be available in respect of investment made up to June 30, 2020. Employers will be allowed a double deduction for wage and salary costs of employees under the “work at home scheme” for the first two years. In addition …
  • Hong Kong Issues Tax Compliance Guide For Property Owners 15th June 2018

    On June 14, 2018, Hong Kong’s Inland Revenue Department released guidance on the tax obligations of landlords.

    Owners in receipt of rental income must inform the Department in writing if they are liable to tax and supply the particulars of the property no later than four months after the end of the basis period for the year of assessment (e.g. on or before July 31, 2018, for the year of assessment 2017-18), unless they have already received the appropriate tax returns. Owners should use the form “Notification of Letting of Properties” (IR6129) for this purpose.

    Property owners must complete a tax return, even if they do not receive rental income. These are: BIR60, for properties solely owned by an individual; BIR57, for properties jointly owned or co-owned by individuals; and BIR58, for property owned by corporations and bodies of persons.

    Sufficient rent records must be retained by property owners, such as lease agreements and duplicates of rental receipts, for at least seven years, and the Department must be informed in writing of a change of ownership or a change in the owner’s address within one month of the change.

    Where a corporation has been exempted from property tax and there is a change in the ownership or use of the property, or in any other circumstances that may affect the exemption, the corporation must notify the Department in writing within 30 days of the event.

  • Cayman Considering Legal Challenge To UK Beneficial Ownership Law 15th June 2018

    Cayman Premier Alden McLaughlin met with lawyers in London on Monday to discuss the territory’s constitutional relationship with the UK in light of UK legislation forcing the territory to set up a publicly accessible register on the beneficial ownership of legal entities.

    Under the UK Sanctions and Anti-Money Laundering Act 2018, enacted in late May 2018, the UK is requiring its 14 Overseas Territories to bring in publicly accessible registers concerning the beneficial ownership of legal entities by 2020 or face having them imposed by the UK Government.

    A number of Overseas Territories, including the British Virgin Islands and Bermuda, have expressed concern that the legislation infringes existing constitutional arrangements, with the British Virgin Islands having instructed lawyers to consider a legal challenge.

    McLaughlin has echoed these concerns saying: “We are concerned about the actions of the House of Commons in seeking to legislate for the Cayman Islands, which amounts to constitutional overreach by forcing the Cayman Islands to adopt public registers of beneficial ownership.”

    Talks were scheduled for the full working week ending June 15, with McLaughlin to meet with the UK’s Minister for the Overseas Territories and the heads of government of other UK Overseas Territories.