Freight tax (excluding Hong Kong SAR, Macau SAR and Taiwan, Province of China)

Bareboat Charter Hire

Enterprise Income Tax: 

  • 10% of the gross profits earned for non-residential shipowners and/or operators who do not have any offices or working venues in China; or for non-residential shipowners and/or operators who have offices in China but their earnings are irrelevant to their offices or working venues.

  • 25% of the gross profit earned  for non-residential shipowners and/or operators who have offices in China.

Value Added Tax: 16% (from 1 May 2018) , 17% (former rate) of the total hire.

 

Time Charter Hire

Enterprise Income Tax:  

  • 10% of the gross profits earned for non-residential shipowners and/or operators who do not have any offices or working venues in China; or for non-residential shipowners and/or operators who have offices in China but their earnings are irrelevant to their offices or working venues.

  • 25% of the gross profit earned  for non-residential shipowners and/or operators who have offices in China.

Value Added Tax: 10% (from 1 May 2018),11% (former rate) of the total hire.

 

Voyage Charter Earnings

Enterprise Income Tax: 

  • 10% of the gross profits earned for non-residential shipowners and/or operators who do not have any offices or working venues in China; or for non-residential shipowners and/or operators who have offices in China but their earnings are irrelevant to their offices or working venues.

  • 25% of the gross profit earned  for non-residential shipowners and/or operators who have offices in China.

Value Added Tax: 11% of the total freight earnings

 

Exemption Agreements
Residents of the following countries may benefit from double taxation agreements, which reduce or waive the enterprise income tax on voyage earnings. 

Country Reduction in Enterprise Income Tax Date of entry into force Date of effect
Double Taxation Agreements
Albania 100% 28/07/2005 01/01/2006
Algeria 100% 27/07/2007 01/01/2008
Armenia 100% 28/11/1996 01/01/1997
Australia 100% 28/12/1990 01/01/1991
Austria 100% 01/11/1992 01/01/1993
Azerbaijan 100% 17/08/2005 01/01/2006
Bahrain 100% 08/08/2002 01/01/2003
Bangladesh 50% 10/04/1997 01/01/1998
Barbados 100% 27/10/2000 01/01/2001
Belarus 100% 03/10/1996 01/01/1997
Belgium (Renegotiated) 100% 29/12/2013 01/01/2014
Brazil 100% 06/01/1993 01/01/1994
Brunei 100% 29/12/2006 01/01/2007
Bulgaria 100% 25/05/1990 01/01/1991
Canada 100% 29/12/1986 01/01/1987
Chile 100%  08/08/2016  01/01/2017
China: Hong Kong, SAR 100% 08/12/2006 01/01/2007
China: Macau, SAR 100% 30/12/2003 01/01/2004
Croatia 100% 18/05/2001 01/01/2002
Cuba 100% 17/10/2003 01/01/2004
Cyprus 100% 05/10/1991 01/01/1992
Czech Republic 100% 04/05/2011 01/01/2012
Denmark (Renegotiated) 1 100% 27/12/2012 01/01/2013
Ecuador 100% 06/03/2014 01/01/2015
Egypt 100% 24/03/1999 01/01/2000
Estonia 100% 08/01/1999 01/01/2000
Ethiopia 1 100% 25/12/2012 01/01/2013
Finland (Renegotiated) 100% 25/11/2010 01/01/2011
France 100% 21/02/1985 01/01/1986
France (Renegotiated) 1  100% 28/01/2014 01/01/2015
Georgia 100% 10/11/2005 01/01/2006
Germany 100% 14/05/1986 01/01/1985
Germany (Renegotiated) 1
100% 05/04/2016 01/01/2017
Greece 100% 01/11/2005 01/01/2006
Hungary 100% 31/12/1994 01/01/1995
Iceland 100% 05/02/1997 01/01/1998
India 100% 19/11/1994 01/01/1995
Indonesia 50% 25/08/2003 01/01/2004
Iran 100% 14/08/2003 01/01/2004
Ireland 100% 29/12/2000 01/01/2001
Israel 100% 22/12/1995 01/01/1996
Italy 100% 14/11/1989 01/01/1990
Jamaica 100% 15/03/1997 01/01/1998
Japan 100% 26/06/1984 01/01/1985
Kazakhstan 100% 27/07/2003 01/01/2004
Korea, Republic of 100% 27/09/1994 01/01/1995
Kuwait 100% 20/07/1990 01/01/1989
Kyrgyzstan 100% 29/03/2003 01/01/2004
Laos 100% 22/06/1999 01/01/2000
Latvia 100% 27/01/1997 01/01/1998
Lithuania 100% 18/10/1996 01/01/1997
Luxembourg 100% 28/07/1995 01/01/1996
Macedonia 100% 29/11/1997 01/01/1998
Malaysia 50% 14/09/1986 01/01/1987
Malta (Renegotiated) 1 100% 25/08/2011 01/01/2012
Mauritius 100% 04/05/1995 01/01/1996
Mexico 100% 01/03/2006 01/01/2007
Moldova 100% 26/05/2001 01/01/2002
Mongolia 100% 23/06/1992 01/01/1993
Montenegro 2 100% 01/01/1998 01/01/1998
Morocco 100% 16/08/2006 01/01/2007
Nepal   31/12/2010 01/01/2011
The Netherlands 100% 05/03/1988 01/01/1989
The Netherlands (Renegotiated) 100% 31/08/2014 01/01/2015
New Zealand 100% 17/12/1986 01/01/1987
Nigeria 100% 21/03/2009 01/01/2010
Norway 100% 21/12/1986 01/01/1987
Oman 100% 20/07/2002 01/01/2003
Pakistan 100% 27/12/1989 01/01/1989
Papua New Guinea 100% 16/08/1995 01/01/1996
Philippines 3 See Note 23/03/2001 01/01/2002
Poland 100% 07/01/1989 01/01/1990
Portugal 100% 07/06/2000 01/01/2001
Qatar 100% 21/10/2008 01/01/2009
Romania 100% 05/03/1992 01/01/1993
Russia 100% 10/04/1997 01/01/1998
Saudi Arabia 100% 01/09/2006 01/01/2007
Serbia 2 100% 01/01/1998 01/01/1998
Seychelles 100% 17/12/1999 01/01/2000
Singapore (Renegotiated) 100% 18/09/2007 01/01/2008
Slovakia 4 100% 23/12/1987 01/01/1988
Slovenia 100% 27/12/1995 01/01/1996
South Africa 100% 07/01/2001 01/01/2002
Spain 100% 20/05/1992 01/01/1993
Sri Lanka 50% 22/05/2005 01/01/2006
Sudan 100% 09/02/1999 01/01/2000
Sweden 100% 03/01/1987 01/01/1987
Switzerland 100% 27/09/1991 01/01/1990
Switzerland (Renegotiated) 1 100% 15/11/2014 01/01/2015
Syria 100% 01/09/2011 01/01/2012
Tajikistan 100% 28/03/2009 01/01/2010
Thailand 50% 29/12/1986 01/01/1987
Trinidad and Tobago 100% 22/05/2005 01/01/2006
Tunisia 100% 23/09/2003 01/01/2004
Turkey 100% 20/01/1997 01/01/1998
Turkmenistan 100% 30/05/2010 01/01/2011
Ukraine 100% 18/10/1996 01/01/1997
United Arab Emirates 100% 14/07/1994 01/01/1995
United Kingdom (Renegotiated) 100% 13/12/2013 01/01/2014
United States 100% 21/11/1986 01/01/1987
Uzbekistan 100% 03/07/1996 01/01/1997
Venezuela 100% 23/12/2004 01/01/2005
Vietnam 100% 18/10/1996 01/01/1997
Zambia 100% 30/06/2011 01/01/2012
Zimbabwe 100% 2016.9.29 2017.1.1
Limited Treaties (Air and/or Sea)
Argentina 100%    
Lebanon 100%    
Double Taxation Agreements which are signed but not ratified
Botswana 100% Signed 11/04/2012  
China 5   Signed 28/08/2015  
Russia (Renegotiated) 100% Signed 13/10/2014  
Uganda 100% Signed 11/01/2012  
Zimbabwe
Signed 01/12/2015  

Notes

  1. The treaty provides that profits from the operation of ships or aircraft in international traffic shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated.

    If the place of effective management of a shipping enterprise is aboard a ship, then it shall be deemed to be situated in the Contracting State in which the home harbour of the ship is situated, or, if there is no such home harbour, in the Contracting State of which the operator of the ship is a resident.
  2. Covered under the former Federal Republic of Yugoslavia agreement
  3. Income tax charged shall not exceed 1.5%
  4. Covered under the former Czechoslovak Socialist Republic agreement
  5. Covers the province of Taiwan

Remarks

All companies must pay the full tax amount and then apply for a refund afterwards.

 

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