The Last piece of the puzzle - China's taxation rule on Shanghai-Hong Kong Stock Connect
On 14 November 2014, the Ministry of Finance, the State Administration of Taxation and China Securities Regulatory Commission jointly released Caishui  No.81 (Notice 81), on the China taxation rules in relation to the Shanghai-Hong Kong Stock Connect (Stock Connect). Under Notice 81, corporate income tax, business tax, and individual income tax will be temporarily exempted on gains derived by foreign investors on the trading of A shares through the Stock Connect.
For income derived by Mainland China investors from investing in shares listed in Hong Kong through the Stock Connect, the China tax implications shall generally follow the current Chinese tax regulations. The effective date of Notice 81 is 17 November 2014.
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