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    Products eligible for tax deductions

    How much do you know about products that are eligible for tax deduction?

    After a year of hard work, you may wish to reduce the tax payment amount as much as possible. The HKSAR Government introduced 3 tax deductions in the year of assessment 2019/20, including Voluntary Health Insurance Scheme (“VHIS”) Certified Plan, MPF Tax Deductible Voluntary Contributions (“TVC”) and Qualifying Deferred Annuity Policy (“QDAP”). However, Hong Kong taxpayers indeed may not have full understanding on the benefits of these eligible products. How much do you know about them?

    What are the products eligible for tax deduction?

    Tax deductions are applicable to qualifying premiums paid under the Voluntary Health Insurance Scheme (VHIS) Policy, premiums paid under a Qualifying Deferred Annuity Policy (“QDAP”) and MPF tax deductible voluntary contributions (TVC). These products are the allowable tax deductions based on your actual spending. They on one hand offer you protections and on the other hand up to HKD68,000 tax deduction per tax assessment year (the maximum tax deduction for qualifying premiums paid under VHIS certified plans for each insured person is HKD8,000 per tax assessment year; and the combined tax deductions for QDAP and MPF TVC is HKD60,000 per each tax assessment year.)

    Qualifying premiums paid under VHIS policy

    The qualifying premiums paid under a certified VHIS plan for yourself or specified relatives are eligible for a potential tax deduction. The maximum deduction for each insured person is HKD8,000 and there is no cap on the number of specified relatives. In other words, you are allowed with more potential tax deduction if you purchase a certified policy for more specified relatives. Yet be cautious about the payment terms and your affordability to avoid overloading merely for potential tax deductions.

    What are specified relatives under VHIS policy?

    Specified relatives refer to

    1. Your spouse
    2. A parent or grandparent of you or your spouse, who is at any time during the year of assessment
      • Aged 55 or above; or
      • Aged under 55 but eligible to claim an allowance under the Government’s Disability Allowance Scheme
    3. A child or sibling of you or your spouse, who is at any time during the year of assessment unmarried and
      • Aged under 18; or
      • Aged 18 or above but aged under 25 and receiving full-time education at a university, college, school or other similar educational establishment; or
      • Aged 18 or above but incapacitated for work by reason of physical or mental disability

    Please refer to the definition of specified relatives as set out in the Inland Revenue Ordinance (Cap. 112).

    MPF Tax Deductible Voluntary Contributions (TVC)

    A stable retirement life is what everyone is hope for. Not just does MPF TVC can help build up your retirement pot, but also enjoy potential tax deductions. The maximum MPF TVC tax deductible amount for a tax assessment year is HKD60,000 (this is an aggregate of QDAP and MPF TVC). However, investment involves risks, and with a longer investment period, contributors can only withdraw the TVC account balance at the age of 65 or when you meet other withdrawal requirements, so it should be considered.

    Qualifying annuity premiums under a QDAP

    Qualifying Deferred Annuity Policy (QDAP) gives you peace of mind by offering a steady income stream to support daily expenses for your retirement life. The qualified annuity premiums may also be eligible for tax deductions up to HKD60,000 in a tax assessment year (tax deduction limits share with MPF TVC). If you and your spouse are both taxpayers with income chargeable to tax, you would be able to enjoy an aggregated maximum deductions of HKD120,000.

    If you are paying qualifying annuity premium for QDAP and also making contribution to MPF TVC in a year of assessment, what will be the deduction order if the total exceeds the specified maximum deduction limit of HKD60,000? Tax deduction for TVC goes first followed by QDAP qualifying annuity premium, up to the maximum deduction of HKD60,000.

    Lodging a claim is easy, simply claim on your Tax Return - Individuals form will do. If you would like to know the latest official announcements about Hong Kong tax deductions, please visit Inland Revenue Department website.

    We provide insurance and MPF products eligible for tax deduction, fitting your needs in every aspect. If you would like to know more about the product details and examples, visit our Insurance plans and MPF scheme for tax savings.

    Enjoy credit card tax payment promotion or go for tax loan for greater financial flexibility

    Besides getting potential tax deductions with VHIS, QDAP and MPF TVC, pay your tax wisely by enjoying credit card tax payment promotions from various banks during the tax season. Paying tax by credit card is easy via Personal e-Banking, and get a chance to earn extra cards rewards upon successful registration of Tax Payment Promotion. After making an online tax payment by credit card, you can even follow the simple steps of applying for Credit Card Tax Instalment Plan right afterwards.

    Also want some financial flexibility? You may go for a tax loan. Interest rate for a tax loan is generally lower than for other personal loan products. You may consider applying for a tax loan to cover your tax payment while improving your cash flow to achieve your plans. Married couple applying for tax loans together may enjoy an even lower interest rate with the combined loan amount.

    To borrow or not to borrow? Borrow only if you can repay!

    Explore our products

    eIncomePro Deferred Annuity Plan (100% Guaranteed)

    • Certified as Qualifying Deferred Annuity Policy thus relevant premiums are qualified for tax deductions[1]
    • Enjoy Monthly Guaranteed Annuity Income for 10 years with life protection and free accidental death benefit for short premium payment period of 5 years
    • Easy online application with guaranteed acceptance
    Apply now
    View details
    Terms and Conditions apply, please note the relevant product risks and credit risks. eIncomePro Deferred Annuity Plan (100% Guaranteed) is underwritten by Hang Seng Insurance Company Limited.

    Bupa Hero VHIS Plan

    • Certified VHIS flexi plan with up to HKD40 million annual benefit limit
    • Full coverage for eligible surgeries and treatments (including cancer and other serious illnesses) in Asia, Australia and New Zealand or worldwide (excluding the US)
    • Up to 15% family discount
    Apply now
    View details
    This is a VHIS flexi plan certified by the Food and Health Bureau of Hong Kong and underwritten by Bupa (Asia) Limited.

    Plan ahead for your moments

    Footnote

    Other point(s) to note

    1. To borrow or not to borrow? Borrow only if you can repay!
    2. Investment involves risks. Past performance is not indicative of future performance. The value of financial instruments, in particular stocks and shares, and any income from such financial instruments, may go down as well as up. For further details including the product features and risks involved, please refer to the MPF Scheme Brochure.
    3. .Disclosure of information: The Voluntary Health Insurance Scheme policies are underwritten by Bupa (Asia) Limited ("Bupa") which is authorised and regulated by the Insurance Authority in Hong Kong. Hang Seng Bank Limited (“Hang Seng Bank”) is an insurance agent authorised by Bupa for the distribution of the above plans. Premiums will be payable to Bupa upon enrolment in the above plans. Bupa will provide Hang Seng Bank with the relevant commission and performance bonus in accordance with the selling of the above plans. The existing sales staff remuneration policy offered by Hang Seng Bank will take into account various aspects of the staff performance but not solely the sales amount. HealthPro Concierge Service and Health Coaching Services are provided by Bupa. In respect of an eligible dispute arising between the Hang Seng Bank and the customer out of the selling process or processing of the related transaction, Hang Seng Bank is required to enter into a Financial Dispute Resolution Scheme process with the customer; however any dispute over the policy terms or performance (claims and service) of the product should be resolved directly between Bupa and the customer.
    4. Hang Seng Bank Limited shall have the right in accordance with the related guideline from regulators and relevant regulations to reject all insurance applications accepted retrospectively and to cease acting as agent of that policy accordingly.
    5. Hang Seng Insurance Company Limited is authorized and regulated by the Insurance Authority of the HKSAR. Hang Seng Bank is an insurance agent authorised by Hang Seng Insurance Company Limited and the insurance products are products of Hang Seng Insurance Company Limited but not Hang Seng Bank.
    6. Hang Seng Bank Limited, is the Sponsor of Hang Seng MPF. Tax deductible voluntary contributions are accepted at the discretion of the MPF Trustee. The MPF Trustee reserves the absolute right not to accept any tax deductible voluntary contributions at any time.
    7. The tax deductions mentioned in the webpage are only available to Hong Kong taxpayers. The information shown on this webpage is for illustrative purposes only. It is not intended to provide any form of tax advice. Hang Seng Bank Limited or Hang Seng Insurance Company Limited does not provide tax advice. You are advised to exercise caution in relation to tax matters and this webpage. If you are in doubt about any of the contents of this webpage, you should obtain independent professional advice. Please note that the tax law, regulations and/or interpretations are subject to change and may affect any related tax incentives including the eligibility criteria for a tax deduction. Hang Seng Bank Limited or Hang Seng Insurance Company Limited is not responsible for informing you about any changes in laws, regulations or interpretations, and how they may affect you.
    8. Terms and Conditions apply.

    Remark(s)

    1. eIncomePro is certified by the Insurance Authority ("IA") as a Qualifying Deferred Annuity Policy ("QDAP"). However, the IA certification is not a recommendation or endorsement of the policy nor does it guarantee the commercial merits of the policy or its performance. It does not mean the policy is suitable for all policyholders nor is it an endorsement of its suitability for any particular policyholder or class of policyholders. The policy has been certified by the IA but such certification does not imply official recommendation. The IA does not take any responsibility for the contents of the product brochure of the policy, makes no representation as to its accuracy or completeness, expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of the product brochure of the policy. The QDAP status of this product does not necessarily mean you are eligible for tax deduction available for QDAP premiums paid. This product’s QDAP status is based on the features of the product as well as certification by the IA and not the facts of your own situation. You must also meet all the eligibility requirements set out under the Inland Revenue Ordinance and any guidance issued by the Inland Revenue Department of the HKSAR before you can claim these tax deductions. Any general tax information provided is for your reference only, and you should not make any tax-related decisions based on such information alone. Please note that only the premium paid net of any marketing offers (e.g. discount, premium waiver, etc.) might be eligible for tax concession and the actual tax benefits of this Policy depend on your personal tax position (e.g. salaries income and assessable profits) and you should always consult a professional tax advisor if you have any doubts. Please note that the tax law, regulations or interpretations are subject to change and may affect related tax benefits including the eligibility criteria for tax deduction. We have no responsibility to inform you about any changes in the laws and regulations or interpretations, and how they may affect you. Further information on tax concessions applicable to QDAPs may be found at www.ia.org.hk .