Manulife Tax-Deductible Solutions

Do you want to save more by saving on tax?

The maximum tax-deductible amount per year is up to HKD68,000¹!

¹Assuming a taxpayer has a VHIS policy he or she could enjoy a maximum tax-deductible premium of HKD8,000 per eligible insured person per tax assessment year. The aggregate maximum tax-deductible limit for both qualifying deferred annuity premiums and Tax Deductible Voluntary Contributions is HKD60,000 per taxpayer per year. The actual amount of tax saved varies according to each taxpayer’s taxable income and the applicable tax rate.

The content of this website does not contain the full terms of the policy(ies), and the full terms can be found in the policy document(s).

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Get more of your family members insured for the chance to save more!

Whether you are taking up a VHIS policy for yourself or a family member, it’s eligible for tax deduction of up to HKD8,000^* per insured person per tax assessment year, with no limits on the number of insured persons!

Learn more about tax deduction

Get a monthly income to enjoy a tax break!

Take up a QDAP certified by the Insurance Authority, and you can apply for tax deduction for the basic plan premiums you paid. If you and your spouse have each purchased a QDAP, the two of you could save up to HKD20,400* in tax per year!

Learn more about tax deduction

Save more for retirement, save more on tax!

Through MPF TVC, you may not only boost your retirement reserves but also enjoy up to HKD10,200^* in tax savings!

Learn more about tax deduction

More about MPF TVC

Limited-time Offer^
^Terms and conditions apply

^*The maximum tax-deductible limit is HK$60,000 per year, which is the aggregate limit for MPF TVC and Qualifying Deferred Annuity Policy (QDAP) premiums, and not an individual limit for MPF TVC and QDAP. The actual amount of tax saved varies according to a taxpayer’s personal income, tax deductible amount, tax allowances, and the contributions made for MPF TVC and/or premiums paid for QDAP. Based on the current peak tax rate of 17%, up to HK$10,200 in tax can be saved per year.

Tax-Deductible Solutions

Manulife Tax-Deductible Solutions include Voluntary Health Insurance Scheme, Qualifying Deferred Annuity Policy and MPF Tax Deductible Voluntary Contributions. All 3 products could help you to save in tax.

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Tax Deductible Case Studies

Melissa quit her 9-to-8 job three years ago to follow her dreams in France where she learnt how to make desserts. She is now an instructor at a cooking school in Hong Kong, teaching interest classes in dessert-making. Since she knows how to promote her skills on social media, Melissa is often invited by companies to teach dessert-making classes. Her income therefore depends on how many classes she teaches. While her hands could be tied if there are too many classes, there is invariably downtime when she just ends up staying idle at home.

Despite an unstable income, Melissa is satisfied with what she earns – an average annual income of HKD420,000. Given the limits of her group life policies, she is concerned about her health coverage for emergencies such as sudden illnesses or accidents. That's why she decides to take up a certified plan under the Voluntary Health Insurance Scheme (VHIS). As she is single, she understands that the earlier she starts retirement planning, the better she can prepare for her golden years. She also understands it’s necessary to save more for retirement as long as she has a decent income.

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Given the unstable nature of her income, she splits the money she wants to save between a Qualifying Deferred Annuity Policy (QDAP) and a Tax Deductible Voluntary Contributions (TVC) account, allocating a total of HKD60,000 each year to these two plans.

Asset	HKD
Deposit	500,000
Equities and Funds	320,000
MPF Accrued Benefits	350,000
Total Assets	1,170,000

	HKD
Annual Personal Income	420,000
Taxable Income^#	270,000
Annual Salary Tax Payable^# (Originally)	27,900
Tax Deduction for VHIS Plan^@	(7,479)
Tax Deduction for TVC / QDAP Premiums	(60,000)
Tax Payable (Now)^#	16,428
Annual Tax Savings	11,472

Melissa is satisfied with her current job. Now that she has acquired medical coverage and boosted her retirement savings, she feels more secure than ever. With these tax-deductible solutions, she is able to save HKD11,472 in taxes, or more than 40% of her original assessment, for the 2019/2020 assessment year. What she saves in taxes could help her fast-track her retirement savings plan. That means she would soon be able to take short courses abroad to learn how to prepare a wider variety of desserts, an opportunity that may further boost her career prospects.

# : The amount of tax payable shown above is computed on June 23, 2019 using the tax calculator developed by the Inland Revenue Department. It is for reference only. The amount is based on the assumption that there is no other applicable tax concession, tax-deductible or allowance. 
@ : Total amount of VHIS premiums eligible for tax deduction = HKD7,479

Writer: Alvin Lam, Certified Money Coach
The information above is for general reference only. It shall not constitute nor shall it be taken as a substitute for the professional advice from an insurance advisor or the MPF registered intermediaries on the purchase of insurance policies. No aspect of this website shall be solely relied upon for the decision of insurance purchase. You should seek relevant professional advice before taking action on any matters to which information provided on this website may be relevant. For more details, please contact your Manulife insurance advisor or the MPF registered intermediaries. We do not provide any tax, legal or accounting advice and consultation to you. If you have any questions, please consult the IRD or independent tax, legal and accounting consultants.

Mandy and her husband Marven are always so occupied with work that they won’t miss any chance to relax and unwind on holidays abroad. They spend about HKD120,000 each year on travel alone. As they don't want kids in their lives and don't have to financially support their parents, they are in a position to spend what they earn on themselves. In recent years, they have become increasingly concerned about the quality of life they can enjoy after retirement. The concern came as a result of their frequent contact, due to their jobs, with frail and infirm elderly people, whose declining health and financial vulnerability have left the couple worried about whether they can achieve the retirement life they want.

As a result, even though they already have group health coverage from their employers, they have each decided to take up a private health insurance plan with multiple benefits, which they hope will become their safety nets against potential medical expenses as they grow older. After doing some research, they concluded that the Flexi Plans launched under the Voluntary Hospital Insurance Scheme (VHIS), which offer protection tailored to their needs as well as tax deduction benefits, were a good fit for them.

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The couple have a passive interest in managing their finances, and hold what remains of their income after expenses mostly in the form of bank savings. Mandy plans to retire in ten years’ time and would like to have a stable income during the first 10 to 20 years of her retirement, when they are about 50 to 70 years old. That’s why she has decided to buy a Qualifying Deferred Annuity Product (QDAP) to help her save more and enjoy tax benefits. Meanwhile, Marven expects to be working until age 65 and prefers a retirement savings plan that provides more investment options. That's why he has chosen the MPF Tax Deductible Voluntary Contributions (TVC) option. They will each contribute HKD100,000 a year to their respective insurance plans for a period of 5 years, which will be funded by their cash savings.

Assets	HKD
Deposits	1,000,000
Equities	120,000
MPF Accrued Benefits	450,000
Self-owned Property	5,700,000
Outstanding Mortgage	(2,200,000)
Total Assets	5,070,000

	HKD
Annual Family Income	756,000
Taxable Income^#	407,713
Annual Salary Tax Payable# (Originally)	33,695
Tax Deductions for 2 VHIS Policies^@	(19,627)
Tax Deduction for MPF TVC/QDAP Premiums^~	(120,000)
Tax Payable (Now)	14,866
Annual Tax Savings	18,829

Insured	VHIS Annual Premium	Tax Deductinos Marven is eligible for	Tax Deductions Mandy is eligible for
Mandy	10,575	2,575	8,000
Marven	9,052	8,000	1,052
		10,575	9,052

For both Mandy and Marven, the total amount of VHIS premiums eligible for tax deduction is therefore HKD19,627.

Making regular contributions to tax-deductible insurance plans while you can still afford it is an approach that helps the couple minimize uncertainty about their retirement lives and reduce their tax burdens. In doing so, they are able to save 56%, or HKD18,829, of their original tax bills. They will also review their investment in these plans regularly, hoping that this can help them retire early and live off the interest.

# : The amount of tax payable shown above is computed on May 29, 2019 using the tax calculator developed by the Inland Revenue Department. It is for reference only. The amount is based on the assumption that there is no other applicable tax concession, tax-deductible or allowance, and that separate taxation is chosen.
@ : Total premium of the two VHIS plans = HKD19,627, amount eligible for tax deduction = HKD19,627

~ : A taxpayer can claim tax deduction for contributions made to TVC accounts and QDAP premiums paid, subject to an aggregate limit of HKD60,000 per assessment year. A taxpaying couple may allocate tax deductions for deferred annuity premiums among themselves in order to claim the combined total deduction of HKD120,000, provided that the deductions claimed by each taxpayer do not exceed the individual limit.

Mr. Man, the major breadwinner of his family, is a manager at a logistics firm, and his wife works for a fast food shop as an accounting clerk. The couple live together with Man’s 65-year-old mother, who helps look after their 10-year-old son.

As the flat where they live was purchased 20 years ago through the Home Ownership Scheme and the mortgage has already been paid off, Man’s financial obligations are not too heavy. However, he is concerned about not being able to cope with rising medical costs in the future since his mother’s health is showing signs of decline. Other than the group medical insurance provided by his employer, the family doesn’t have any medical protection.

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Assets	HKD
Deposits	550,000
Equities	400,000
MPF Accrued Benefits	1,020,000
Self-owned Property	5,380,000
Total Assets	7,350,000

Worried that he will likely have to shoulder all the medical expenses needed for his family members in the future, Mr. Man decided to purchase a certified plan under the Voluntary Health Insurance Scheme (VHIS) for all three of them, in hopes of being better prepared for potential medical emergencies. This also gives him the opportunity to avail himself of any tax savings to be made, since under the VHIS, he can apply for tax deduction for the premiums paid for his dependents’ policies.

Meanwhile, the couple would also like to plan for their retirement, which could be some 20 years away. Concerned about her job security, Mrs. Man decided to open an MPF Tax Deductible Voluntary Contributions (TVC) account, which doesn’t require long-term financial commitment, and made a contribution of HKD60,000 to this account over the course of this year.

In order to secure a continuous stream of income for his retirement, Mr. Man has also bought a Qualifying Deferred Annuity Policy (QDAP) with an annual premium of HKD120,000.

As a result of these decisions, Man has achieved a total of HK$16,167 in tax savings, or 48% of the original tax amount owed. By using these additional savings to support future spending, he will be better prepared for a more secure retirement in the future.

	HKD
Annual Family Income	876,000
Taxable Income^#	363,200
Annual Salary Tax Payable# (Originally)	33,692
Tax Deductions for 3 VHIS Policies	(34,229)
Tax Deduction for MPF TVC/QDAP Premiums	(120,000)
Tax Payable (Now)	17,525
Annual Tax Savings	16,167

Insured	VHIS Annual Premium	Eligible Tax Deduction for Mr. Man	Eligible Tax Deduction for Mrs. Man
Mother of Mr. Man	17,234	8,000	8,000
Mrs. Man	13,220	8,000	5,220
Son of Mr. Man	5,009	5,009	-
		21,009	13,220

The couple may enjoy a total tax deduction of HKD34,229 if they choose joint assessment.

They will be entitled to a total tax deduction of HKD34,209 under personal assessment.

# : These figures were arrived at based on calculations using the tax calculator developed by the Inland Revenue Department. Calculation results show that joint assessment can help Mr. and Mrs. Man save more than personal assessment.
**Assuming that there is no other applicable tax concession and that child and dependent parent allowances have already been claimed.
https://www.ird.gov.hk/chi/ese/st_comp_2018_19_budget/cstcfrm.html
Disclaimer: The payable tax amount shown above was calculated on May 27, 2019 using the tax calculator developed by the Inland Revenue Department.

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What is tax deduction under VHIS?

VHIS is a policy initiative introduced by the Health Bureau. Citizens may apply for tax deduction on the qualifying premiums paid by a citizen for himself/herself and his/her specified dependent(s) (i.e. specificed relatives) for VHIS certified plans on or after April 1, 2019. The deduction ceiling is set at HK$8,000 per insured person per year. There is no cap on the number of dependent(s) that are eligible for tax deduction. For example, if you purchase 3 VHIS plans for 3 dependents, you can apply for tax deduction for the premiums paid up to HK$24,000 (HK$8,000 x 3) per year.

What is the definition of 'specified relatives'?

Specified dependents include the taxpayer’s spouse and children, and the grandparents, parents, brothers or sisters of the taxpayer or his/ her spouse. Please refer to Section 112 of the Tax Ordinance for the detailed definition.

How to estimate the tax savings from purchasing VHIS certified plan?

Tax savings from purchasing VHIS certified plan depend on the eligible premiums paid and tax rate like below:
Eligible VHIS certified plan premiums x Tax Rate = Potential Tax Savings

For example, if your premium paid is HK$3,800, assuming the tax rate is 17%, you may possibly enjoy HK$646 in tax savings. But the actual tax savings you can enjoy will depend on your personal tax assessment and situation. For details, please visit the website of VHIS Office of Health Bureau and the Inland Revenue Department.

What is the insurance product category of VHIS?

VHIS is an individual indemnity hospital insurance product, which provides reimbursements of medical expenses.

What are the plan options available under VHIS?

2 types of certified plans are available under VHIS – Standard Plan and Flexi Plan. Standard Plan follows the minimum requirements of VHIS from the Government, providing standardized basic protection. Flexi Plan provides more comprehensive protection and product selection compared with Standard Plan. Manulife offers Manulife Shelter VHIS Standard Plan, Manulife First VHIS Flexi Plan and Manulife Supreme VHIS Flexi Plan to give you well-rounded protection based on your needs.

What is TVC?

Tax Deductible Voluntary Contributions (TVC) is a new type of voluntary contributions which is tax-deductible under the MPF system. Members are free to choose their own MPF scheme to set up their TVC account and make contributions directly without involvement of employers.

What is a QDAP?

Qualifying Deferred Annuity Policy (QDAP) is a deferred annuity product complying with the guidelines issued by the Insurance Authority (IA) and being certified by the IA. Premiums paid to QDAP are tax-deductible. QDAP must comply with a number of requirement including but not limited to: the minimum total premiums of HK$180,000, a minimum payment period of 5 years and annuitization at the age of 50 or above. Please click here for more details.

What is maximum tax-deductible amount for both TVC and QDAP?

Premiums paid to QDAP or making MPF TVC (TVC) for retirement purpose are eligible for tax deduction. The aggregate maximum tax-deductible amount for both qualifying deferred annuity premiums and TVC is HK$60,000 per taxpayer per year. The amount of tax deduction will depend on a number of factors, including personal income, entitled tax allowances and deductions, premiums paid to QDAP or TVC made, etc. Based on the highest tax rate for the year of assessment 2018/19 (i.e. 17%), the maximum tax savings can reach up to HK$10,200 per year.

When will tax deduction be effective? When can I start claiming the deductions?

Tax deduction will come into effect from the year of assessment 2019/20. You can report the amount of premiums paid to QDAP and contributions TVC made from April 1, 2019 to March 31, 2020 when you file the tax return in 2020.

How do I find out the amount of premium paid to QDAP and the amount of TVC made to MPF trustee?

For QDAP, the supporting documents should show the amount of qualifying deferred annuity premiums paid during the year of assessment (e.g. the annual summary or premium payment record issued by insurance companies). For TVC, MPF trustee is required to provide a TVC summary to each TVC account holder within 40 days from the end of a fiscal year (i.e. 10th of May each year), to assist the scheme members to report the amount of TVC when filing their tax return.

When can I withdraw the accrued benefits from my TVC account?

Same as that with mandatory contributions, any accrued benefits derived from TVC are required to preserve and can only be withdrawn upon TVC account holder reaching the age of 65 (except for other statutory grounds under the MPF regulations).

Do I need to open another MPF account for TVC?

You need to open a MPF TVC account.

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Are you looking for:

Manulife Tax-Deductible Solutions

The maximum tax-deductible amount per year is up to HKD68,000¹!

Our experts are here to help you!

Thank you for
contacting Manulife!

Dear {Salutation} {FirstName} {LastName},

Your personal enquiry number: {ReferenceID}

Oops!
Please excuse us, something went wrong.

Get more of your family members insured for the chance to save more!

Get a monthly income to enjoy a tax break!

Save more for retirement, save more on tax!

Tax-Deductible Solutions

Tax Deductible Case Studies

show more

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show more

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show more

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Tax Savings Calculator

Get an estimation on your tax savings!

Learn more about our tax saving insurance plans

What is tax deduction under VHIS?

What is the definition of 'specified relatives'?

How to estimate the tax savings from purchasing VHIS certified plan?

What is the insurance product category of VHIS?

What are the plan options available under VHIS?

What is TVC?

What is a QDAP?

What is maximum tax-deductible amount for both TVC and QDAP?

When will tax deduction be effective? When can I start claiming the deductions?

How do I find out the amount of premium paid to QDAP and the amount of TVC made to MPF trustee?

When can I withdraw the accrued benefits from my TVC account?

Do I need to open another MPF account for TVC?

Are you looking for:

Manulife Tax-Deductible Solutions

The maximum tax-deductible amount per year is up to HKD68,0001!

Our experts are here to help you!

Thank you for contacting Manulife!

Dear {Salutation} {FirstName} {LastName},

Your personal enquiry number: {ReferenceID}

Oops! Please excuse us, something went wrong.

Get more of your family members insured for the chance to save more!

Tax Deductible Case Studies

show more

hide details

Tax Savings Calculator

Get an estimation on your tax savings!

Learn more about our tax saving insurance plans

What is tax deduction under VHIS?

What is the definition of 'specified relatives'?

How to estimate the tax savings from purchasing VHIS certified plan?

What is the insurance product category of VHIS?

What are the plan options available under VHIS?

The maximum tax-deductible amount per year is up to HKD68,000¹!

Thank you for
contacting Manulife!

Oops!
Please excuse us, something went wrong.