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Individuals in certain jurisdictions in the Asia-Pacific region have long had an interest in Canada. Sometimes, that interest is to settle in Canada permanently. For others, it is to obtain a Canadian passport and then potentially leave Canada, often returning to their jurisdictions of origin.

Like most countries in the world, Canada levies taxation on world income if an individual is a resident. If an individual is not resident in Canada, taxation is confined to certain Canadian source income. Therefore, it becomes very important to determine if and when an individual 1) becomes and 2) ceases to be resident in Canada.

Lastly, as this article will show, the rules for determining Canadian residence are significantly modified by international treaties.

Pillar 2 is currently being implemented on a near global basis, with various jurisdictions legislating for a Qualified Domestic Minimum Top-up Tax (QDMTT) and the GloBE Rules. QDMTTs are purely domestic versions of the GloBE Rules, designed to capture Top-up Tax in the implementing jurisdiction. Whereas the GloBE Rules are designed to be internationally applicable. QDMTTs effectively have priority over the GloBE Rules, with the concept of a QDMTT Safe Harbour elevating the importance of QDMTTs further. As jurisdictions implement the rules, the distinction between QDMTTs and the GloBE Rules is becoming more and more apparent. The potential for discrepancy between the various rules implemented across jurisdictions and the challenges posed by the rapidly evolving Agreed Administrative Guidance (AG) are also becoming clear. Each of these aspects threatens to create divergence in what was once perceived, and is still trying to be, a globally uniform and consistent set of rules.

中國的企業所得稅的法定稅率是25%，爲了扶持特定地區的經濟發展，中國在部分區域陸續推出了一系列財稅政策，例如：西部地區、前海深港現代服務業合作區（下文簡稱“深圳前海”）、珠海橫琴粵澳深度合作區（下文簡稱“珠海橫琴”）、福建平潭綜合實驗區（下文簡稱“附件平潭”）、海南自由貿易港（下文簡稱“海南自貿港”）、廣州市南沙區（下文簡稱“廣州南沙”）、上海自由貿易試驗區臨港新片區（下文簡稱“上海臨港”）、新疆困難地區，新疆喀什、霍爾果斯兩個特殊經濟開發區等區域，都推行了企業所得稅低稅率或者企業所得稅减免優惠。

Money laundering is the process of converting illegally acquired proceeds from crime into seemingly legitimate sources of income. It typically goes through three stages: placement, layering, and integration.

Tax crimes are tax offences committed to reduce or avoid one’s tax obligations by hiding or providing false information to the tax authorities. Tax crimes are indictable offences and constitute predicate offences for money laundering.

Tax professionals can be used for money laundering in several ways as they process the financial information of individuals and entities. Hence, it is imperative that tax professionals understand their exposure to tax crimes and money laundering risks so that they do not indirectly facilitate the propagation of such crimes.

To mitigate the risks, tax professionals should implement robust internal policies, procedures, and controls (“IPPCs”), which should minimally cover risk assessment, customer due diligence, ongoing monitoring, and suspicious transaction reporting.

Departmental Interpretation and Guidance Note No. 38[1] (“DIPN 38”) is dead and Mr Forlee has killed it. Or has he? In historical circles, it is now fashionable to speak of sweeping changes as ‘transitions’; in this historiographical tradition that is wary of bright lines of demarcations from one period to another, the Roman Empire never ‘fell’ but rather underwent a process of ‘transformation’ that produced the early modern period. Howsoever we regard the impact of the Forlee case on DIPN 38 and the salaries tax landscape as a whole, these will never be the same again. Practitioners often seem less interested in salaries tax cases than they are in profits tax appeals, but the last decade has arguably been more eventful for the development of jurisprudence in the salaries tax field than it has for profits tax.

[1] Accessible on the Inland Revenue Department’s Internet site at https://www.ird.gov.hk/eng/pdf/dipn38.pdf.

Volume 37 and Volume 37 First Supplement of the Inland Revenue Board of Review Decisions were published in June 2023 and September 2023, respectively. Seven cases are reported in these two publications: one salaries tax case, one penalty tax case, and five profits tax cases. The salaries tax case concerns late appeal. One of the five profits tax cases concerns appeal out of time. Of the remaining profits tax cases, one concerns taxability of profits derived from the sale of property, one is related to whether profits were derived from a business, one considers deduction of management fees paid to a related party, and one is related to the application of an Interest Income Exemption Order.

The Financial Secretary delivered the 2023/24 Budget (the “Budget”) today (22 February 2023). The Taxation Institute of Hong Kong (the “Institute”) supports this Budget. In view of the fact that economic activities begin to revive from the epidemic and the various economic stabilisation measures implemented over the past year gradually yield results, the Institute agrees the Government to continue implementing oneoff smaller-scale measures to support enterprises and general public for recovering the economy of Hong Kong.

The Hong Kong economy deteriorated markedly in the first quarter of 2022, followed by some improvement in the second quarter but with a widened year-on-year contraction in the third quarter of 2022. Real GDP fell by 4.5% in the third quarter of 2022 over a year earlier. For the first three quarters of 2022 as a whole, the economy contracted by 3.3% over a year earlier. The HKSAR Government revised its real GDP growth forecast for 2022 from -0.5% to 0.5% (as announced in August 2022) to -3.2%1. The HKSAR Government originally forecasted a fiscal deficit of
HK$56.3 billion for 2022-23 but has now indicated that a fiscal deficit amounting to over HK$100 billion is envisaged for this year.

There have been a number of changes recently to Cambodian tax law and its interpretation, as well as to the compliance processes. There has been a steady transformation from a manual filing and reporting system to an electronic platform. Although certain requirements still require manual processing due to the limitations of the electronic system, we believe the electronic platform
is a step in the right direction in terms of creating a more efficient and streamlined tax system in Cambodia. Taxpayers in Cambodia need to keep themselves up to date on the rapid changes in the tax laws and practices to ensure they properly comply with their obligations in Cambodia and take advantage of any opportunities.