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Tax Indemnification Agreement
"I need a Tax Indemnification Agreement under Hong Kong law for a share purchase transaction between our manufacturing company and its subsidiary, covering historical tax liabilities from January 2025 onwards, with specific focus on profits tax and employee benefits taxation."
1. Parties: Identifies and defines the Indemnitor and Indemnitee and their legal capacity
2. Background: Sets out the context of the agreement, including the underlying transaction or relationship giving rise to the tax indemnification
3. Definitions: Defines key terms including 'Tax', 'Tax Authority', 'Tax Liability', 'Claims', and other relevant terms
4. Scope of Indemnification: Details the specific tax matters and periods covered by the indemnification
5. Indemnification Obligations: Specifies the Indemnitor's obligations to pay, reimburse, or otherwise compensate the Indemnitee for covered tax liabilities
6. Claims Procedure: Sets out the process for making indemnification claims, including notice requirements and timing
7. Payment Terms: Specifies when and how payments must be made, including currency and method of payment
8. Dispute Resolution: Establishes procedures for resolving disputes related to indemnification claims
9. Term and Survival: Specifies the duration of the agreement and which provisions survive termination
10. Governing Law and Jurisdiction: Confirms Hong Kong law as governing law and specifies jurisdiction for disputes
1. Tax Returns and Audits: Procedures for handling tax returns and audits, used when ongoing tax compliance cooperation is needed
2. Third Party Claims: Procedures for handling claims from tax authorities or other third parties, included when such claims are likely
3. Security Provisions: Requirements for security or collateral to support indemnification obligations, used for high-value or high-risk indemnifications
4. Tax Mitigation: Obligations to minimize tax liabilities, included when active tax management is expected
5. Change in Law Provisions: Addresses impact of changes in tax laws, included for long-term agreements
6. Cross-Border Provisions: Specific provisions for cross-border tax implications, used when multiple jurisdictions are involved
1. Schedule 1 - Covered Tax Matters: Detailed list of specific taxes, periods, and transactions covered by the indemnification
2. Schedule 2 - Excluded Tax Matters: List of specific tax matters explicitly excluded from the indemnification
3. Schedule 3 - Pre-Existing Tax Liabilities: Details of known tax liabilities existing at the time of agreement
4. Schedule 4 - Claim Form Template: Standard form for making indemnification claims
5. Appendix A - Power of Attorney: If required, grants authority to handle tax matters on behalf of another party
6. Appendix B - Tax Warranties: Detailed tax warranties given by the Indemnitor regarding the covered tax matters
Authors
Financial Services
Banking
Insurance
Real Estate
Manufacturing
Technology
Retail
Healthcare
Professional Services
Energy
Infrastructure
Transportation
Telecommunications
Legal
Finance
Tax
Treasury
Compliance
Risk Management
Corporate Development
Mergers & Acquisitions
Corporate Secretariat
Internal Audit
Chief Financial Officer
Tax Director
Corporate Lawyer
Finance Manager
Tax Manager
Compliance Officer
Treasury Manager
Financial Controller
Corporate Secretary
Risk Manager
M&A Director
Due Diligence Specialist
Transaction Advisory Manager
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