Tax exemptions for foreign investment in local start-ups<\/p>\n
In order to attract foreign investment to help boost start-ups in the Special Administrative Region, the Hong Kong government is considering making investments into its ITVF scheme by foreign funds or persons easier and tax exempt, according to a report by law firm Deacons.<\/p>\n
The ITVF scheme was established by the government\u2019s Innovation and Technology Venture Fund as a co-investment vehicle between the government and international venture funds. Under the current arrangement, strict territorial conditions have meant that foreign investors may lose their tax exempt status. To address this, the Innovation and Technology Bureau has proposed to expand the current list of Specified Transactions to also include a share transaction in an ITVF scheme investee company that is carried out through or arranged by a Specified Person, or carried out by a non-resident partner fund.<\/p>\n
The Inland Revenue Ordinance (Amendment of Schedule 16) Notice 2018 was tabled on the May 2nd, and clarifies that a \u201cnon-resident ITVF partner fund\u201d means a partner fund that is a non-resident person to which the general profits tax exemption in section 20AC applies.<\/p>\n
The Notice will most likely be enacted on 22 June, according to the report.<\/p>\n","protected":false},"excerpt":{"rendered":"