Desktop VersionSite MapContact UsShare RSS
  • Default font size
  • Bigger font size
  • Biggest font size

Departmental Interpretation and Practice Notes

With effect from 1 April 2002, Departmental Interpretation and Practice Notes (DIPNs) will only be published on the IRD website. Permission is given for the downloading of these materials from the website provided that the source of the information is acknowledged and that re-dissemination or reproduction is for a non-commercial purpose.

To help keep tax representatives and other interested parties informed of current developments, IRD will advise such persons by e-mail whenever a new DIPN is issued.

For inclusion in the e-mail service mentioned above, registration is required. Please e-mail the registration to [email protected] providing the following information -

  (a) name of firm / orgainisation / individual;
  (b) business registration number, if applicable;
  (c) e-mail address to which IRD e-mail should be sent;
  (d) name and telephone number of contact person.

The following Interpretation and Practice Notes are saved in PDF format. PDF file can be opened by Adobe Acrobat Reader which is available at the Adobe Systems Incorporated


Departmental Interpretation and Practice Notes
No. Departmental Interpretation and Practice Notes Date Issued
1. Profits Tax
Part A : Computing assessable profits
Part B : Revenue recognition
Part C : Measurement of inventories or stock
September 2020
2. Profits tax
Part A : Industrial building allowances
Part B : Commercial buildings allowances
April 1999
3. Profits tax - Apportionment of expenses July 2008
4. Lease premiums / Non-returnable deposits / Key or tea money / Construction fees etc. February 2006
5. Profits tax deductions for expenditure on -
Technical education
Building refurbishment
Prescribed fixed assets
Environmental protection facilities
April 2019
6. Inland Revenue Ordinance - Provisions as to
(A) Objections to the Commissioner
(B) Appeals to the Board of Review
(C) Appeals to the Courts
November 2016
7. Machinery and plant - Depreciation allowances August 2009
8. Profits tax - Losses September 2009
9. Major deductible items under salaries tax September 2006
10. The charge to salaries tax June 2007
11. Field audit and investigation October 2007
12. Commissions, rebates and discounts September 2001
13. Profits tax -
Taxation of interest received
December 2004
13A. Profits tax -
Deductibility of interest expense
December 2004
14. Property tax March 2011
15. (A) Limitation of loss relief (Section 22B)
(B) Leasing arrangements (Section 39E)
(C) General anti-avoidance provision (Section 61)
(D) General anti-avoidance provision (Section 61A)
(E) Loss companies (Section 61B)
(F) Ramsay principle
(G) Penalty on tax avoidance cases
(H) Guidelines on lease financing
(I) Advance rulings
January 2006
16. Salaries tax - Taxation of fringe benefits October 2003
17. The taxation of persons chargeable to
profits tax on behalf of non-residents
January 2005
18. Assessment of individuals under salaries tax and personal assessment February 2020
19. The agreement between
the United States of America and Hong Kong
in respect of the taxation of shipping profits
28 September 1989
20. Mutual Funds, unit trust and similar investment schemes June 2012
21. Locality of profits July 2012
22. Taxation of royalties and other income from intellectual properties August 2020
23. Recognized retirement schemes May 2019
24. Profits tax - Service company "Type II" arrangements July 2009
25. Service company "Type I" arrangements - Salaries tax November 2011
26. Profits tax - Specified securities for the purposes of section 15E of the Inland Revenue Ordinance June 2009
27. Profits tax - Stock borrowing and lending June 2010
28. Profits tax : Deduction of foreign taxes July 2019
29. Tax relations between
the Hong Kong Special Administrative Region and
the People's Republic of China
August 1997
30. Profits tax : Section 20AA
Persons not treated as agents
September 2009
31. Advance rulings April 2020
32. Arrangement between the Mainland of China and the Hong Kong Special Administrative Region for the avoidance of double taxation on income (Note 1) October 2011
33. Insurance agents October 2009
34. Exemption from profits tax (interest income) Order 1998 December 2004
35. Concessionary deductions : Sections 26E and 26F
Home loan interest
February 2020
36. Concessionary deductions : Section 26D
Elderly residential care expenses
February 2020
37. Concessionary deductions : Section 26C
Approved charitable donations
February 2020
38. Salaries tax - Employee share-based benefits March 2008
39. Profits tax - Digital Economy, Electronic Commerce and Digital Assets March 2020
40. Profits tax - Prepaid or deferred revenue expenses August 2010
41. Salaries tax - Taxation of holiday journey benefits August 2003
42. Profits tax -
Part A : Taxation on financial instruments
Part B : Taxation of foreign exchange differences
June 2020
43. Profits tax exemption for offshore funds (Note 3) May 2016
44. Arrangement between the Mainland of China and the Hong Kong Special Administrative Region for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income August 2008
45. Relief from double taxation due to transfer pricing or profit reallocation adjustments (Note 2) April 2009
46. Transfer pricing guidelines - Methodologies and related issues (Note 2) December 2009
47. Exchange of information on request July 2020
48. Advance Pricing Arrangement July 2020
49. Profits tax deduction of capital expenditures on patent rights, rights to know-how and specified intellectual property rights August 2020
50. Taxation of specified alternative bond schemes July 2014
51. Profits Tax Exemption for Offshore Private Equity Funds (Note 3) May 2016
52. Taxation of Corporate Treasury Activity September 2016
53. Tax Treatment of Regulatory Capital Securities August 2020
54. Taxation of Aircraft Leasing Activities October 2017
55. Deduction for Research and Development Expenditure April 2019
56. Concessionary Deductions: Sections 26H to 26M Health Insurance Premiums February 2020
57. Concessionary Deductions: Sections 26N to 26U Annuity Premiums and MPF Voluntary Contributions February 2020
58. Transfer Pricing Documentation and Country-by-Country Reports July 2019
59. Transfer Pricing between Associated Persons July 2019
60. Attribution of Profits to Permanent Establishments in Hong Kong July 2019
61. Profits Tax Exemption for Funds June 2020

 Note 1: The arrangement explained herein ceases to apply after the year of assessment 2006/07.

 Note 2: Transactions between associated persons or non-Hong Kong resident persons’ permanent establishments in Hong Kong, to which the transfer pricing-related provisions in the Inland Revenue (Amendment) (No. 6) Ordinance 2018 do not apply, should be dealt with in accordance with Departmental Interpretation and Practice Notes Nos. 45 and 46.

 Note 3: Tax exemption explained therein will only apply to non-resident persons or entities not falling within the meaning of “fund” under section 20AM for any year of assessment commencing on or after 1 April 2019.

 back to top


Estate Duty Office Interpretation and Practice Notes
No. Estate Duty Office Interpretation and Practice Notes Date issued
1. Controlled companies provisions under the Estate Duty Ordinance (Cap.111) 21 December 2000

 back to top


Stamp Office Interpretation and Practice Notes
No. Stamp Office Interpretation and Practice Notes Date issued
1. Stamping of agreements for sale and purchase of immovable property November 2018
2. Relief for stock borrowing and lending transactions February 2011
3. Deemed consideration under section 24 of the Stamp Duty Ordinance, Cap.117 September 1998
4. Deemed sale and purchase under section 19(1E) of the Stamp Duty Ordinance, Cap.117 25 January 2000
5. Special Stamp Duty July 2014
6. Alternative Bond Schemes August 2014
7. Buyer's Stamp Duty July 2014
8. Ad Valorem Stamp Duty November 2018