Hong Kong-Mauritius tax treaty signed

Hong Kong SAR (HK) signed a Comprehensive Double Tax Agreement (CDTA) with Mauritius on 7 November 2022.  This is the 46th CDTA concluded by HK.

Below is a comparison of the withholding tax rates applicable to dividends, interest and royalties, under the respective domestic tax law and the HK-Mauritius CDTA: 

^{NB1: The 4.95% rate generally applies.  If the royalty is paid to an associated entity and the intellectual property has been owned by a person carrying on business in HK, the higher rate of 16.5% applies.  If the taxpayer is eligible for two-tiered tax rates, 2.475% (or 8.25% if higher rate) applies on the first HKD 2 million of assessable profits and 4.95% (or 16.5% if higher rate) on the remaining amount.}

^{NB2: 15% for payments made to a non-resident company in general; 0% for payments made to a bank or non-bank deposit-taking institution.}

^{NB3: 0% if the beneficial owner is a company which holds directly at least 10% of the capital of the company paying the dividends throughout a 365 day period, or paid to the Government of Mauritius / HK, the HK Monetary Authority, the Exchange Fund of HK, the Bank of Mauritius, or any entity wholly or mainly owned by the Government of Mauritius / HK as may be agreed from time to time between the competent authorities of both jurisdictions; 5% in all other cases.}

^{NB4: 0% if it is paid to the Government of Mauritius / HK, the HK Monetary Authority, the Exchange Fund of HK, the Bank of Mauritius, or any entity wholly or mainly owned by the Government of Mauritius / HK as may be agreed from time to time between the competent authorities of both jurisdictions; otherwise, the rate will be 5%.}

The HK-Mauritius CDTA will come into force after the completion of ratification procedures by both jurisdictions.  The CDTA can be downloaded from this link.

Tax Newsflash is published for the clients and professionals of Deloitte Touche Tohmatsu. The contents are of a general nature only. Readers are advised to consult their tax advisors before acting on any information contained in this newsletter.

Authors

Doris Chik
Tax Partner
+852 2852 6608
dchik@deloitte.com.hk
 
Carmen Cheung
Tax Manager
+852 2740 8660
carmcheung@deloitte.com.hk

Kiwi Fung
Tax Manager
+852 2258 6162
kifung@deloitte.com.hk
 
International and M&A Tax
National Leader
Vicky Wang
Tax Partner
+86 21 6141 1035
vicwang@deloitte.com.cn

Hong Kong
Anthony Lau
Tax Partner
+852 2852 1082
antlau@deloitte.com.hk