Following the industry consultation from August to September 2020 on the initial proposals for Hong Kong’s carried interest tax concession regime, the Legislative Council Panel on Financial Affairs met on 4 January 2021 to discuss the legislative proposals before the amendment bill is introduced to the Legislative Council in February 2021.
The proposals have been refined to consider industry comments, making it very competitive, and providing taxpayers with tax certainty. The proposals include a 0% profits tax rate on eligible carried interest, and exclude 100% of eligible carried interest from employment income for the calculation of salaries tax. This is a long-awaited development, and key to the development of the Hong Kong asset and wealth management industry.
The August 2020 proposal can be viewed here.
Asia Pacific Asset & Wealth Management Tax Leader and China Private Equity Tax Leader, PwC Hong Kong
Tel: + 2289 1833