ISLAMABAD: Pakistan and Hong Kong signed a pact on avoidance of double taxation and prevention of fiscal evasion with respect to taxes on income. The agreement was signed by Pakistan’s Ambassador to China Masood Khalid and the Secretary for Financial Services and the Treasury, Professor K C Chan.
The agreement, once ratified, shall benefit individuals and companies working in Pakistan and Hong Kong by providing safeguards against paying double taxation on the incomes of the residents of both jurisdictions.
Under the agreement, double taxation will be avoided in any Pakistani tax paid by Hong Kong companies and will be allowed as a credit against the tax payable in Hong Kong on the same profits, subject to the provisions of the tax laws of Hong Kong.
Likewise, for Pakistani companies, the tax they pay in Hong Kong will be allowed as a deduction from the tax payable on the same income in Pakistan.
Published in The Express Tribune, February 18th, 2017.