Dividends to A shares, tax problems are inevitable, and personal income tax is up to 20%. However, the tax can be deducted through the holding time, so do you need to pay a tax when Hong Kong stocks pay dividends? Let's look at the relevant regulations.

Do Hong Kong stocks need to pay taxes on dividends?

Is the dividend of Hong Kong stocks taxable?

1 Individual investors in Chinese mainland invest in Hong Kong stocks through the Hong Kong Stock Connect account: Dividends obtained from listed companies are subject to personal income tax withholding at the rate of 20%.

2 Mainland individual investors open direct investment accounts in Hong Kong stocks: According to the arrangement of avoiding double taxation in the Mainland and Hong Kong, individual shareholders can generally withhold and pay personal income tax at the rate of 10%.

China enterprises directly listed in Hongkong are foreign-invested enterprises: when distributing dividends to overseas non-resident individuals, there is no need to withhold and remit non-resident personal income tax.

4 Local investors in Hong Kong invest in listed companies in Hong Kong: If there is no dividend tax, personal income tax will be withheld and remitted at the rate of 10% upon receipt of dividends distributed by mainland enterprises.

5 Individuals who receive dividends from mainland enterprises listed in Hongkong are residents of other countries, and the dividend tax rate agreed between the host country and China tax authorities is not 10%, so they should be taxed at the relevant agreed tax rate.

The difference between dividends of Hong Kong stocks and A shares;

1 Hong Kong stock dividends can be distributed in foreign currencies other than Hong Kong dollars. China Clearing will uniformly distribute bonus funds to you in RMB after the exchange, while A shares will be distributed directly in RMB;

2 Hong Kong stocks can have the option to pay dividends, that is, they can declare no more than the number of dividend rights recorded in date of record, and choose to use stock dividends instead of cash dividends, while investors have no option when paying dividends in A shares.

Since 320 14, listed companies in Shanghai market have paid dividends of R+ 1. Because there are dividend options in Hong Kong stocks, there is a long interval between the dividend registration date and the actual dividend date.

On the whole, when dividends are distributed to Hong Kong stocks, including cash dividends and stock dividends, the tax collection is different according to the identity of the holders and listed companies.