[2020 Tax] 5 Key Points for Filling in Profits Tax Return

The Inland Revenue Department has issued Profits Tax Return 2019/20 to active companies on May 4, 2020.


In order to correctly fill out and submit the tax return on time, be sure to pay attention to the following 5 key points:


1. The submission deadline is normally within one month of the tax return issue date. Companies with fiscal year end dates between 1 April, 2019 and 30 November, 2019 (commonly known as N Code) have no additional opportunities for extension in the past. However, due to the epidemic situation, N Code can through a tax representative apply to the IRD to extend the submission deadline to 30 June, 2020. For details, please refer to “Extend Submission Deadline for 2019/20 Profits Tax Return”


2. When filling out the profits tax return for 2019/20, be careful of the following new requirements:
a. Part 1.3
b. Part 3.9
c. Part 3.9.1
d. Part 7.5
e. Part 8.1.3
f. Part 10.7
g. Part 10.8
If you are not sure how to fill in the above requirements, please contact us


3. The “two-tier tax rate” will continue to be implemented in 2019/20. The tax rate for the portion of assessable profits that does not exceed HK$2,000,000 is 8.25%, while the tax rate for the portion exceeding HK$2,000,000 is 16.5%.


4. According to the 2020-21 budget, the profits tax for 2019/20 can be reduced by 100%, but the ceiling for each company is HK$20,000.


5. When submitting the profits tax return, a limited company must have prepared an “audited financial statement” issued by a certified public accountant practicing in Hong Kong. If the company’s total income exceeds HK $ 2,000,000, the tax return must be submitted together with the “audited financial statements”.


When you have received the 2019/20 profits tax return, and you found that you have not yet:
1. Start preparing the 2019/20 books of accounts
2. Appoint an auditor
3. Appointment of tax representative
Please contact us immediately, without further delay!


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