Donations to tax-exempt charities or to Government for charitable proposes is tax deductible. The amount can deduct from your net assessable income or assessable profits. Thus, a qualified donations is tax deductible for both an individual or a company.

Eligibility for Deduction

You may claim a deduction for a donation of money to any approved charity under section 88 of the Inland Revenue Ordinance or to the Government for charitable purposes. You can also claim a deduction for any approved charitable donation made but not claimed by your spouse.

Donations Not Accepted as Tax Deductions

Not all payments to tax-exempt charities are deductible. The following are not the examples of payments allowable donations:

  • Payments for lottery or raffle tickets; admission to film shows or charity shows; grave spaces
  • Payments made for services such as saying prayers or the reservation of a space for ancestral worship
  • Purchase of goods in bazaars
  • Payments made to a church, a tax-exempt charity, through dropping cash in the donation bag without donation receipt.

What is the tax-deductible ceiling?

Donors may claim up to 35% of total assessable income or profits for the tax year. This provides substantial benefits for donors in Hong Kong. For example, if the assessable income is HK$500,000 after allowable expenses, individuals may claim up to HK$175,000 in approved charitable donations. On the other hands, the aggregate deduction of donations cannot be less than HKD100.

Lodging a Claim for a Deduction

To lodge a claim, you should enter the total amount of approved charitable donations made during the relevant year of assessment in your Tax Return – Individuals (BIR60). This donation can be claim once.

Supporting Documents

You need not to submit any documentary evidence to your tax return. However, you must ask for donation receipts from the tax-exempt charity or the Government. Furthermore, you should retain the receipt for 6 years after the expiration of the year of assessment.

For further information, please contact us.

You may want to read: Tax Deduction for Charitable Donations in Hong Kong