Tax issues arising from corporate amalgamations in Hong Kong

In June 2021 Hong Kong finalised legislation codifying the Inland Revenue Department’s tax assessment practice relating to corporate amalgamations.  For qualifying companies, it is possible to elect (within one month of the amalgamation) for special tax treatment for pre-amalgamation losses, succession to business assets, amongst other areas.

While the new legislation provides greater certainty on how these special tax rules apply, there are particular complexities to consider in whether or not to make the election.  The election is irrevocable and there are complex qualifying requirements.  These are covered in more detail in our US tax desk newsletter.  For further advice on this area, please get in touch with the Mazars tax team in Hong Kong.