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Hong Kong, as a globally recognized free port and international financial center, applies the territorial source principle of taxation. One advantage of this system is that profits wholly arising outside Hong Kong may be exempted from Hong Kong profits tax. The key conditions for a Hong Kong company’s offshore profits to qualify for tax exemption are genuine offshore operations, a complete chain of evidence, and compliant reporting.
On 25 February 2026, Mr. Paul Chan Mo-po, Financial Secretary of the Hong Kong Special Administrative Region, delivered the 2026–27 Budget at the Legislative Council, setting out the development direction for the vibrant city in the coming year. On tax and relief measures, the Budget introduced a number of concessions:Reduction in salaries tax and tax under personal assessment for the year of assessment 2025/26 by 100%, subject to a HK$3,000 ceiling.
Korea Companies is required to submit their financial statements when filing their corporate income tax returns. Financial year is a period specified in a company’ Article of Incorporation but it cannot exceed a period of 12 months. Korean Companies with total assets or revenues more than KRW 50 billion are subject to appoint an external audit.
In general, there are two types of domestic branches in Korea, namely “Branch” and “Liaison Office”. Although both are categorized as domestic branches, their functions are totally different. A branch can have sales and business activities in Korea to generate profits while a liaison office can only carry out non-sales function, such as quality control, advertisement, market survey, etc.
