At present, many mainlanders will set up companies in Hong Kong when doing international trade. It should be noted that this should be done every yearHong Kong corporate auditA formal audit report shall be submitted to the Hong Kong Tax Bureau. But many still trade with Hong Kong companies. This is not only for the convenience of collection and payment, but also for the tax policy of Hong Kong which is very suitable for international trade, because Hong Kong does not levy profits tax on profits that do not occupy Hong Kong resources.

However, while enjoying this tax, it is also worth noting that for the profits that do not occupy Hong Kong resources, it may be necessary to defend and explain to the tax bureau. After the tax bureau's examination, it will finally decide whether these profits need to pay tax in Hong Kong. This process of defense and explanation is called an offshore claim.

Offshore claims are not required every year. Defence is only required upon receipt of an offshore claim defence letter from the Inland Revenue Board. And after an answer, the Hong Kong Tax Bureau usually doesn't ask the company to answer again for five to six years.

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