In the accounting of companies in Hong Kong, some companies will buy funds, bonds and stocks to earn capital gains, but do these gains need to be subject to profits tax in Hong Kong? Is there any difference with the mainland? The following is a simple analysis:

Capital gains (including bid-ask spread, dividends and interest) from funds, bonds and stocks (including bid-ask spread, dividends and interest) are involved in the accounting and auditing of Hong Kong companies. If the main business of Hong Kong companies is not capital investment, then the capital gains involved are not subject to profits tax in Hong Kong. If the main business income of a Hong Kong company is capital investment, it needs to make a specific distinction whether the transaction is carried out in the Hong Kong Stock Exchange. If it is, it needs to pay Hong Kong profits tax on capital gains. If the investment transaction is carried out outside Hong Kong, it does not need to pay Hong Kong profits tax.

In the mainland, if it involves the difference between the investment price of funds and stocks, the income tax has not been implemented for the time being. Because the problem of how to offset the investment loss has not been solved at present, the income of investors can not be taxed. And fund, stock dividend need to pay income tax according to "dividend, interest, bonus". Only "dividends, interest and bonuses" derived from investments in mainland listed companies are subject to preferential tax treatment.

Only more understanding of the mainland and Hong Kong tax system, in order to better tax arrangements, to achieve the purpose of reasonable tax savings for enterprises.

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