QROPS Advice: Taxation of ‘Non-Residents’ in Hong Kong

The liability to HKST on employment for an individual depends on whether the remuneration is received from an office in Hong Kong, from Hong Kong employment or from non-Hong Kong employment.
If remuneration is from Hong Kong employment an individual is fully taxable unless they render services entirely outside Hong Kong or spend not more than 60 days on visits to Hong Kong during any tax year, of which a full income exemption is available. Where an individual renders services partly in Hong Kong and partly in foreign territories, and the foreign services are subject to a tax which is similar to HKST in that particular country, only the amount of income relating to the Hong Kong services will be subject to Hong Kong tax.
If remuneration is from non-Hong Kong employment, an individual will only be liable to tax in Hong Kong if their visits to Hong Kong exceed 60 days during any tax year. Where an individual stationed in Hong Kong on regional duties is required to travel
frequently outside Hong Kong, they may apply to pay tax on a time apportionment basis by reference to the number of days spent in Hong Kong during the tax year. In this case the individual's income for foreign duties does not have to be subject to tax.
A person will generally be regarded as having a non-Hong Kong employment where:
􀂃 Their employer is resident outside Hong Kong; and
􀂃 The contract of employment has been negotiated and concluded and is enforceable outside Hong Kong; and
􀂃 The remuneration is paid to the employee outside Hong Kong.
However, the IRD reserves the right to look beyond these three factors when appropriate.

http://www.ailo.org/common/externalPage.asp?intURL=/publications/default.asp&extURL=/downloads/Hong_Kong_2009.pdf