Article 1 of the Announcement of State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) on Issues Related to the Payment of Interest and the Withholding and Remittance of Enterprise Income Tax by Domestic Institutions to Overseas Branches of Chinese Banks (State Taxation Administration of The People's Republic of China Announcement 20 15 No.47) stipulates: The overseas branches mentioned in this announcement refer to branches established by Chinese banks overseas without the legal person status of the host country (region). Overseas branches, as overseas branches established by China resident enterprises, belong to the same legal person as their head office. The interest earned by overseas branches from domestic institutions is the income of the branch and is included in the operating profit of the branch. According to the relevant provisions of the Notice of the Ministry of Finance of State Taxation Administration of The People's Republic of China on Relevant Issues Concerning Tax Credit for Overseas Income of Enterprises (Caishui [2009]125), enterprise income tax is paid in the head office. When domestic institutions pay interest to overseas branches, they do not withhold and remit enterprise income tax.

Therefore, if the branch of Bank of China in Hong Kong does not have the legal person status in Hong Kong and is merged with the head office to pay enterprise income tax, there is no need to withhold and remit enterprise income tax.