Revitalizing Hong Kong's Economy: Unveiling a Dynamic Fiscal Policy for 2024
Hong Kong finance chief Paul Chan Mo-po has announced the 2024- 25 Budget included a series of measures to spur growth.
NOVA, as your reliable business partner, knows it may be a hard time for most of the business, thus we have extracted some of the main key points which may benefit your business as follows.
Relief Measures for Business
1. Profits Tax
- Reducing profits tax for the year of assessment 2023/24 by 100 per cent, subject to a ceiling of $3,000. The reduction will be reflected in the final tax payable for the year of assessment 2023/24.
2. Salaries Tax
- Reducing salaries tax and tax under personal assessment for the year of assessment 2023/24 by 100 per cent, subject to a ceiling of $3,000. The reduction will be reflected in the final tax payable for the year of assessment 2023/24.
3. Rates
- Providing rates concession for non‑domestic properties for the first quarter of 2024/25, subject to a ceiling of $1,000 for each rateable property.
4. Government Subsidy and Loan
- Assisting SMEs in tackling their capital-flow problems by extending the application period for the 80% and 90% Guarantee Products under the SME Financing Guarantee Scheme for two years to the end of March 2026. The total guaranteed commitment under the Scheme will increase further by $10 billion.
5. Government Funding and Support
BUD Fund
- Raising the cumulative funding ceiling per enterprise and streamlining application procedures for the Dedicated Fund on Branding, Upgrading and Domestic Sales (BUD Fund).
- Injecting $500 million more into the fund to help SMEs boost their competitiveness and tap into Mainland and overseas markets. This includes the launch of “E‑commerce Easy” under the fund. It will provide support of up to $1 million per enterprise for implementing e‑commerce projects in the Mainland.
Deduction of Expenses and Allowances under Profits Tax
- Introducing two enhancement measures for deduction of expenses under profits tax. Profits-tax payers will be granted tax deduction for expenses incurred in reinstating the condition of the leased premises to their original condition.
- As regards the allowances for industrial buildings and structures as well as commercial buildings and structures, the time limit for claiming the allowances will be removed. This will allow the new owner to claim allowances for the property after a change of ownership, subject to factors such as the construction cost of the property and the balancing charge of its previous owner. Both enhancement measures will take effect from the year of assessment 2024/25.
Tax Increase Measures
1. Business registration fees
- Business registration fees will increase by $200 to $2,200 per annum with effect from 1 April 2024. To relieve the relevant impact, the business registration levy of $150 payable to the Protection of Wages on Insolvency Fund will be waived for two years.
2. Salaries Tax and Personal Assessment
- Implementing a two‑tiered standard rates regime for salaries tax and tax under personal assessment starting from the year of assessment 2024/25. In calculating the amount of tax for taxpayers whose net income exceeds $5 million and whose salaries tax or tax under personal assessment is to be charged at a standard rate, the first $5 million of their net income will continue to be subject to the standard rate of 15 per cent, while the portion of their net income exceeding $5 million will be subject to the standard rate of 16 per cent.
*All of the above are coming from the 2024-25 Budget proposal. The relevant legislative amendment is subject to the scrutiny by the Legislative Council.
Contact NOVA for Professional Service
NOVA is a highly professional company that can provide you with expert assistance for your business. Our team of specialists understands the importance of timely and precise reporting, and we are well-equipped to guide you through the process.
Contact us now to ensure that your company meets all obligations and deadlines.
