Tax dodgers beware – a long-awaited tax treaty with Hong Kong came into effect in Canada last week with the new year.
The treaty, which was signed in November 2012 during Canadian Prime Minister Stephen Harper’s visit to Hong Kong, has some pretty substantial implications. The treaty (which comes into effect in Hong Kong when the new financial year starts there in April) aims to provide clarity for the huge floating community of dual residents and dual nationals who split their time between Hong Kong and, generally, Vancouver or Toronto. This was essential, since it had previously been established that the 1986 tax treaty between Canada and China did not apply to Hong Kong, with its pre-1997 colonial status and post-1997 standing as a Special Administrative Region of the PRC.
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