Wednesday, March 3, 2021
Hong Kong will grant taxpayers a waiver of up to HKD10,000 (USD1,290) of profits tax, salaries tax, and tax under personal assessment, the territory announced in its 2021-22 Budget.
The Budget announces a one-off 100-percent reduction of profits tax, salaries tax, and tax under personal assessment for the year of assessment 2020-21, subject to a ceiling of HKD10,000 per case.
The tax reduction is not applicable to property tax. However, individuals with rental income, if eligible for personal assessment, may be able to enjoy such reduction under personal assessment.
Hong Kong's Inland Revenue Department (IRD) has set out how the waiver would operate, as follows:
The IRD said that taxpayers should file their profits tax returns and tax returns for individuals for the year of assessment 2020-21 as usual. Upon enactment of the relevant legislation, the IRD will effect the reduction in the final assessment.
The Budget further includes a waiver of business registration fees for 2021-22 and an increase to the rate of ad valorem stamp duty from 0.1 percent to 0.13 percent of the consideration or value of each transaction of Hong Kong stock, payable by buyers and sellers.