From a tax perspective, enterprises going global

On the afternoon of July 11, 2025, at Denghu Classroom, Lawyer Assistant Qu Yingqi conducted a deep analysis of the 'Hong Kong Tax System VS Singapore Tax System' and provided tax guidance for companies going global.

1、 Territorial jurisdiction: Hong Kong is more pure, Singapore has conditions for overseas taxation

The district assistant pointed out that although both Hong Kong and Singapore have territorial jurisdiction, the regulations in Hong Kong are more pure. Hong Kong imposes almost no tax on the overseas income of tax residents (including individuals and businesses). Singapore belongs to semi territorial jurisdiction, and income generated or sourced outside of Singapore must be taxed in Singapore as long as it is obtained in Singapore. This means that when choosing a place of registration and business layout, enterprises need to fully consider the differences in taxation rules for overseas income between the two places in order to optimize the tax structure.

2、 Corporate income tax: Hong Kong's two-tier tax system is flexible, while Singapore has diverse tax reduction policies

In terms of corporate income tax, Hong Kong implements a two-tier tax system. Starting from April 1, 2018, for annual net profits within the first 2 million Hong Kong dollars, the tax rate is 8.25%; For amounts exceeding HKD 2 million, the tax rate is 16.5%. This tax system is more friendly to low profit startups and small businesses, and can effectively reduce tax burdens in the early stages of business development.

Singapore's corporate income tax adopts a unified tax rate of 17%, but has set up rich exemption policies for enterprises at different stages and conditions. For newly established companies that meet the conditions, the first 200000 SGD of taxable income in the first three years can enjoy partial tax exemption: the first 100000 SGD of taxable income is exempt from tax by 75%, with an actual tax rate of 4.25%; The taxable income for the next 100000 Singapore dollars is 50% tax-free, with an actual tax rate of 8.5%; The portion of taxable income exceeding SGD 200000 shall be subject to normal taxation at 17%. If the tax exemption conditions for start-up companies cannot be met, non start-up companies established for 3 years can also apply for a Partial Tax Exemption (PTE) plan: the first 10000 SGD of taxable income is exempt from tax by 75%, which is a tax rate of 4.25%; The taxable income for the next 190000 Singapore dollars is 50% tax-free, with a tax rate of 8.5%; The excess amount will be taxed at 17%. This series of policies aims to encourage entrepreneurship and sustainable development of enterprises, especially for local residents' start-up enterprises, and provide significant tax incentives.

3、 Personal taxation: Hong Kong has a simple tax rate structure, while Singapore offers preferential treatment to distinguish resident status

Hong Kong's salaries tax adopts a progressive tax rate in parallel with the standard tax rate, with a progressive tax rate of 2% -17% applied to annual income below HKD 2 million, divided into five levels; Taxpayers with an estimated amount of HKD 2 million or more are subject to a standard tax rate of 15%, and can choose the most favorable tax calculation method for themselves.

Singapore's personal income tax applies a progressive tax rate for taxable income, ranging from 2% to 24%, with a total of twelve levels. There is also a standard tax rate of 15%, whichever is higher. According to the Income Tax Act, non resident individuals in Singapore do not enjoy personal income tax benefits, while in Hong Kong, regardless of whether they are residents or non residents, as long as they pay taxes in Hong Kong, they can enjoy the same tax benefits.

In terms of dividends and interest, both residents and non residents in Hong Kong are exempt from taxation; Singapore non resident dividends are exempt from taxation, but interest is subject to a 15% tax rate.

4、 Property tax: Hong Kong's self occupied properties are exempt from taxes, while Singapore's tax structure is complex

In terms of property tax, Hong Kong only levies a 15% property tax on rental properties, exempts self occupation from taxes, and can deduct repair fees, mortgage interest, and other expenses; The first SGD 12000 of the annual value of self occupied properties in Singapore is tax-free, and any excess will be subject to a progressive tax rate of 4% -32%; Non self occupied properties will be subject to progressive tax rates ranging from 12% to 36% starting from 2025.

After listening to the sharing of Lawyer Assistant Qu Yingqi, every colleague felt that they had benefited greatly. Thank you very much for the sharing from Lawyer Assistant Qu Yingqi today. We look forward to learning more useful knowledge through Denghu Classroom!