Tax Deduction for Assisted Reproductive (AR) Service expenses

The tax deduction applies to the year of assessment 2024/25 and to all subsequent years of assessment.

You cannot claim the deduction since the AR services were not received by either you or your spouse. Nor can your daughter claim the deduction since the expenses were not paid by her.

No. To qualify for the tax deduction, you must receive the gamete freezing services for medical reasons.

You can claim the tax deduction provided that the service of the RT procedure, had it been carried out as planned, would have been received by you for medical reasons and the medical service –

Generally speaking, the deduction covers all directly related expenses paid for the qualifying AR services such as drugs, consultation fees, hormonal tests charges, laboratory fees, in-patient charges, and operation fees.

Licensed centres are those centres which are regulated under the Human Reproductive Technology Ordinance (Cap. 561) and hold the relevant licence (viz. an artificial insemination by husband licence, a treatment licence or a storage licence) issued by the Council on Human Reproductive Technology.

No. RT procedures provided outside Hong Kong are not regulated by the Human Reproductive Technology Ordinance (Cap. 561). Expenses paid for receiving those RT procedures in an overseas institution are not tax deductible.

You should claim the deduction for the year of assessment during which the qualifying AR service expenses were paid.

The deduction ceiling for each year of assessment is $100,000.

The amount of deduction allowable to a taxpayer is the amount of expenses paid in the year of assessment, or the deduction ceiling for that year of assessment, whichever is the lesser.

If the taxpayer is a married person, the total amount of deduction allowable to the taxpayer or the taxpayer’s spouse or both of them is the aggregate amount of expenses paid in the year of assessment, or the deduction ceiling for that year of assessment, whichever is the lesser.

Your spouse can claim deduction for the whole amount of the expenses paid by you so long as you are not living apart from your spouse when making the payment and you do not claim deduction for the expenses paid. You and your spouse may also claim deduction for the expenses paid in equal or unequal shares provided that the total amount of deduction allowable to both of you does not exceed the amount of the expenses paid and the deduction ceiling of $100,000, whichever is the lesser.

As your spouse has no income chargeable to tax, he / she is not entitled to the deduction of the expenses paid. However, you can claim deduction for the expenses paid by your spouse provided that you are not living apart from your spouse when the payment is made.

No. You can only claim deduction of the qualifying AR service expenses paid by your spouse when your spouse is not living apart from you.

The qualifying AR service expenses paid are taken to be reduced by the amount of the reimbursement. If the reimbursement is received before the deduction is claimed, you can only claim a deduction of $60,000. If the reimbursement is received after the deduction is claimed, you must notify the Commissioner in writing of the reimbursement within 3 months after the date of reimbursement. If the deduction has been allowed, an assessor may, having regard to the reduction, make an additional assessment.

No. Apart from requesting the payment receipt, you have to request a registered medical practitioner of a licensed centre who holds clinical responsibility for the reproductive technology procedure received to sign and issue a standard form of proof for qualifying AR service expenses (the Proof) to certify: (a) the amount of expenses paid; (b) the date of payment of those expenses; and (c) the eligibility for tax deduction.

Before the passage of the relevant bill, if you intend to claim tax deduction for the qualifying AR service expenses paid on or after 1 April 2024, you should retain the relevant receipt(s) so that you can obtain the Proof from the relevant licensed centre after the passage of the bill.

Yes. Although you need not attach the Proof to support your claim when you file your tax return, you should retain the documentary evidence for 6 years after the expiration of the relevant year of assessment for verification when required.

The consequence for failure to produce the Proof is that: -

For any false claim cases, penalty will be imposed or prosecution instituted.

Yes. Deduction of qualifying AR service expenses is a “concessionary deduction” under Part 4A of the Inland Revenue Ordinance, which means that the expenses paid will be deducted from your assessable income under salaries tax, or from your total income under personal assessment. The balance will then be subject to the progressive tax rates (after deducting personal allowances) or standard rate. That is, you are eligible to claim the deduction of qualifying AR service expenses paid even if you are assessed at the standard rate.

A non-resident is eligible to claim the deduction of qualifying AR service expenses under salaries tax provided he / she satisfies all prescribed conditions relating to the deduction. However, in the case of a claim made under personal assessment, the claimant must in the first instance be a person eligible to elect personal assessment, which means that he / she is ordinarily resident in Hong Kong or is a temporary resident of Hong Kong.

Before the passage of the bill, you cannot be allowed the deduction of the relevant expenses. You should complete the tax clearance procedure as usual before leaving Hong Kong. Upon the passage of the bill, you may lodge an objection against the assessment and provide the proof for qualifying AR service expenses signed and issued by a registered medical practitioner who holds clinical responsibility for the reproductive technology procedure received of the licensed centre in relation to the qualifying AR service expenses paid on or after 1 April 2024 as documentary evidence.

After the passage of the relevant bill and the receipt of the notice of salaries tax assessment, you may apply in writing for holding over of the provisional salaries tax charged for the year of assessment 2024/25 in respect of the deduction. The time limit for the application is 28 days before the due date for payment of the provisional tax, or 14 days after the date of the notice for payment of the provisional tax, whichever is later.

Provided that all prescribed conditions for deduction of qualifying AR service expenses paid are satisfied, the deduction will not be withdrawn even if you fail to conceive.