The Wolf Group’s Director, Len Wolf, visited Hong Kong and Seoul, South Korea in late September to explore the opportunity to establish a Wolf Group office in East Asia.  In the two cities, Len assessed the market for U.S. tax compliance and planning services available to U.S. expatriates, interviewed candidates for the director of the foreign office position, and met with clients of the Firm living in East Asia.  He also met with representatives of Asian Development Agencies, U.S. Embassy personnel, and The Wolf Group’s Nexia network associates.

In respect of Hong Kong, Len observed that “the economy is very vibrant and the growth is apparent.”  With approximately 70,000 U.S. expatriates and a significant number of U.S. multinational companies located in Hong Kong, the market for U.S. expatriate and corporate taxation certainly exists in the City, and increasingly on the Mainland.  He noted that there are a very limited number of firms that specialize in international and expatriate U.S. taxation there, as does The Wolf Group, suggesting that a significant opportunity exists there for the Firm.

As the Chinese tax system on the Mainland is becoming more complex, and with the Chinese government changing tax requirements rapidly, Len is advising companies that plan on sending employees there to be prepared to deal with comprehensive and changing tax rules and regulations.   Also, with dramatically enhanced enforcement by the U.S. government with respect to the reporting of Foreign Bank Accounts (FBAR), Len is also advising U.S. companies and U.S. expatriates with such interests in foreign bank (and investment) accounts in Hong Kong and elsewhere to be aware of the rules and associated draconian penalties for lack of compliance.  He reports that the local financial press in Hong Kong and Singapore is reporting that much of the money formerly held by Americans in Swiss bank and investment accounts is moving to East Asia.

Len found the market in Seoul to be similar to that of Hong Kong with respect to U.S. expatriate and U.S. multinational company taxation.

He left the two cities feeling optimistic about a decision to establish a foreign office in East Asia which would serve as a prototype for additional Wolf Group offices in other regions.  We will keep you informed as our international expansion plans progress.

 

This newsletter is for informational purposes only. It should not be constituted as tax, legal, or investment advice. Information has been gathered from sources believed to be reliable, but individual situations can vary and you should consult with your investment, accounting and/or tax professional.

ANY TAX ADVICE IN THIS COMMUNICATION IS NOT INTENDED OR WRITTEN BY THE WOLF GROUP TO BE USED, AND CANNOT BE USED, BY A CLIENT OR ANY OTHER PERSON OR ENTITY FOR THE PURPOSE OF (i) AVOIDING PENALTIES THAT MAY BE IMPOSED ON ANY TAXPAYER OR (ii) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY MATTERS ADDRESSED HEREIN.