The tax authority in Hong Kong, the Inland Revenue Department (“IRD”), sent out around 220,000 Profits Tax Returns, 120,000 Property Tax Returns and 310,000 Employer’s Returns for the year of assessment 2022/23 on 3 April 2023. The IRD will be sending out around 2.4 million of tax returns for individuals on 2 May 2023.

In accordance with the regulations, a taxpayer who receives a tax return shall complete and submit it back to the IRD within a month of issue of the said return or any other time specified in the relevant return. Otherwise, the taxpayer may be subject to a fine for late filing of return.

As a taxpayers, in reporting and filing your tax return for the year 2022/23, you are entitled to enjoy the various concessions announced by the Financial Secretary of Hong Kong on his 2023/2024 Budget, including a one-off reduction of profits tax, salaries tax and tax under personal assessment for the year of assessment 2022/23 by 100%, subject to a ceiling of HKD6,000 per case. Please note that the foregoing concessionary measures will be implemented upon completion of the relevant legislative procedures. Upon enactment of the relevant legislation, the IRD will make tax reduction in the final tax assessment for this year. It is noted that no additional application for this proposed concessionary measure is required.

This concessionary measure is applicable for the year of assessment 2022/23, that is, they are applicable to the accounting year ended within the period from 1 April 2022 to 31 March 2023.

In addition, eligible taxpayers can also enjoy the benefit of the two-tiered profits tax rates regime. Under the two-tiered profits tax rates regime, the first HKD2 million of assessable profits of corporations and unincorporated businesses will be taxed at 8.25% and 7.5% respectively, whereas the remaining assessable profits above HKD2 million will be taxed at 16.5% for corporations and 15% for unincorporated businesses. Taxpayers must declare whether they will be taxed at two-tiered profit tax rates in their profits tax returns.

If Kaizen is the tax agent or company secretary of your Hong Kong company, we will contact you by email upon receipt of the tax return and discuss with you the declaration issues. If you do not hear anything from us before 31 May 2023, please contact us so as to make sure that our notice is not lost during its transmission.

Kaizen has a team of professional tax experts with extensive experiences and can provide Hong Kong tax filing services and handling the application for tax exemption on offshore profits derived by a Hong Kong registered company. For Hong Kong profits tax and the application for exemption from Hong Kong profits tax for offshore businesses in 2022/23, please refer to our website for related information:

1. The HKSAR Government Proposes to Reduce the Profits Tax for the Year of Assessment 2022-23
2. Introduction on Taxation of Hong Kong Companies Operating Offshore
3. Hong Kong Plans to Waive Business Registration Fees for 2022-23

Kaizen suggests you consult the professional advice of tax advisors before taking actions. Should you have any questions in relation to the proposals, please feel free to contact our CTAs in Hong Kong.

Benjamin HP Yen
Tax Partner
T: +852 2270 9768
E：benjamin.yen@kaizencpa.com

Vicki Wong
Tax Planning Manageress
T: +852 2270 9725
E: vicki.wong@kaizencpa.com

See Also:
Hong Kong Tax Filing Services