July 18, 2023
Hong Kong introduces new tax treatments for insurers upon adoption of a risk-based capital regime
The Hong Kong "Insurance (Amendment) Ordinance 2023" (the New Law) was gazetted on 14 July 2023. The New Law introduces the RBC regime for Hong Kong insurers under the Insurance Ordinance and makes corresponding tax legislative changes. The new tax treatments will be applicable to an insurer in the year of assessment in which it adopts the RBC regime.
Currently, insurers of Hong Kong are subject to a rule-based capital adequacy regime that does not consider risk profiles of individual insurers. The RBC regime introduced by the New Law will align Hong Kong with international regulatory requirements to fully reflect the risk profiles of individual insurers.
The New Law also provides new tax treatments to address consequential tax changes:
For additional information with respect to this Alert, please contact the following:
Ernst & Young Tax Services Limited, Hong Kong
Ernst & Young LLP (United States), Hong Kong Tax Desk, New York
Ernst & Young LLP (United States), Asia Pacific Business Group, New York
Ernst & Young LLP (United States), Asia Pacific Business Group, Chicago
Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor