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Hong Kong Company Formation: Estate Duty

Company Formation Hong Kong: Estate Duty

The Revenue (Abolition of Estate Duty) Ordinance 2005 has come into operation on 11 February 2006. No estate duty is payable in respect of estates of persons passing away on or after that date. The benefit of abolition has also been extended to cases of deaths occurring on or after 15 July 2005 but before 11 February 2006, by imposing a nominal duty of HK$100 on such estates if the assessed value exceeds HK$7.5 million.

For persons who pass away on or after 1 April 1998 but before 15 July 2005, estates valued at $7,500,000 or below are exempt from duty. The rates of duty are 5% for 28 estates over $7,500,000 in value but not exceeding $9,000,000; 10% for estates over $9,000,000 in value but not exceeding $10,500,000; and 15% for estates over $10,500,000 in value. There is a marginal relief at the commencement of each higher band. Assets situated outside Hong Kong are not subject to duty. In some countries, double taxation relief is granted for estate duty paid in Hong Kong.