Apr 2012, Issue 5
Source rule in ING Baring upheld by the Court of Appeal in the Li & Fung case
The Court of Appeal ("COA") handed down its judgment in the Li & Fung case on 19 March 2012. The COA dismissed the Commissioner's appeal and upheld the lower court's judgment that the commission income derived by the taxpayer from sourcing goods from overseas suppliers on behalf of its customers was offshore and not subject to Hong Kong profits tax. This News Flash provides a summary of the COA's judgment and looks at the implications thereon.
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