I am considering to start up an IT consultancy company in Hong Kong. I would work as a freelancer with clients anywhere in the world, but I currently have a specific client in Europe in mind (Belgium).
I've read that not only do I not have to charge 21% VAT to my client from Belgium, but that my client does not need to pay it as well because I will be outside of EU. (source in Dutch) This means that neither Belgium nor Hong Kong is receiving any VAT. Can I get some confirmation that this is true?
It seems weird to me that my client would have to pay VAT to a company anywhere in the EU, but that this tax would disappear when you purchase a service from outside of EU. Isn't the point of Europe to provide benefits to the countries within it? This seems like the opposite is happening.
I have another question specifically about Hong Kong company tax. It is listed to range from 8.25% - 16.5%, but foreign sourced income is not taxed. That means that my earnings from Europe effectively enjoy 0% tax. But I've read from an individual that this exemption from tax only applies if I am not earning it from Hong Kong. I have not been able to find this rule anywhere. Does anyone know whether or not this is true?