Hong Kong Tax Newsflash

The draft legislation¹ regarding the RBC regime for the insurance industry was passed by the Legislative Council on 6 July 2023.  It provides a legal framework for the implementation of the RBC regime.  The Bill also seeks to amend the Inland Revenue Ordinance (IRO) as follows:

• Provide for a spreading over arrangement to assess the one-off increase in assessable profits arising from the implementation of the RBC regime over five years
• Re-define the insurance businesses into 3 categories for tax purpose:
  • Life insurance business
  • Non-life long term insurance business
  • General insurance business
• Provide that the assessable profits of non-life long term insurance business be ascertained based on the adjusted surplus basis per Section 23 of the IRO

Please refer to our Hong Kong Tax Newsflash Issue 181 for more details.  

The amendments to the IRO will come into operation on the day on which the Ordinance is published in the Gazette (i.e. 14 July 2023 tentatively).

1 Insurance (Amendment) Bill 2023

^{Tax Newsflash is published for the clients and professionals of Deloitte Touche Tohmatsu. The contents are of a general nature only. Readers are advised to consult their tax advisors before acting on any information contained in this newsletter.}

If you have any questions, please contact our professionals:

Authors

Jonathan Culver
Tax Partner
+852 2852 6683
joculver@deloitte.com.hk

Doris Chik
Tax Partner
+852 2852 6608
dchik@deloitte.com.hk

Carmen Cheung
Tax Manager
+852 2740 8660
carmcheung@deloitte.com.hk

Jessica Chu
Senior Consultant
+852 2531 1542
jeschu@deloitte.com.hk

Global Financial Service Industry

National Leader
Natalie Yu
Tax Partner
+86 10 8520 7567
natyu@deloitte.com.cn

Hong Kong
Anthony Lau
Tax Partner
+852 2852 1082
antlau@deloitte.com.hk