Clifford Chance

Hong Kong to introduce expanded profits tax exemption regime for funds

17 December 2018

On 7 December 2018, the Hong Kong government gazetted the Inland Revenue (Profits Tax Exemption for Funds) (Amendment) Bill 2018 (the "Expanded Funds Tax Exemption"). The Bill introduces a new preferential tax regime for qualifying funds and provides fund managers an alternative to the existing offshore funds tax regime, which has been in place for over a decade (the "existing regime"). The Expanded Funds Tax Exemption would apply to a wide range of offshore and onshore funds and proposes to remove a number of problematic aspects of the existing regime - in particular, its ring-fencing and tainting features.

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