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TVC is a form of MPF contributions which can help you save money while enjoying tax deduction. The contributions you make to this TVC account (up to an annual limit of HKD60,000) will be counted as a deductible item when you report your taxable income. Depending on your TVC amount, based on the prevailing highest tax rate (i.e. 17%), the maximum tax savings can reach $10,200*.
Scheme members can enjoy the flexibility to make TVC to their TVC accounts at any time and in varying amounts. They can also increase or reduce the amount of contributions, or cease to make contributions, or resume the making of contributions at any time, having regard to their personal circumstances.
TVC is designed to fortify your retirement reserves, so it is subject to the preservation requirement applicable to mandatory contributions and can only be withdrawn upon scheme member's reaching age 65 or on other statutory grounds under the MPF legislation.
*This is the maximum tax concession amount in the year of assessment 2021/2022.
Flexible contributions
Flexible contribution terms, allowing you to increase or reduce the amount of contributions
Tax concession
Enjoy tax deductions of up to a maximum of HK$60,000 per year and maximum amount of tax savings of HK$10,200*
Easy to manage
Choose to open a TVC account with MPF scheme that meets your needs and make contributions directly to the account
*This is the maximum tax concession amount in the year of assessment 2021/2022.
Examples of salary tax computation resulting from MPF Mandatory Voluntary Contributions (MC) and Tax Deductible Voluntary Contributions (TVC).
Assumptions:
1. The total incomes listed below were earned by employees for the year of assessment 2021/2022; and
2. The tax savings amounts are calculated based on the allowances and at the progressive rate for the year of assessment 2021/2022 (note: the progressive rate for the year of assessment 2022/2023 is same as 2021/2022)
Marissa
HR Manager
Single
Monthly salary HK$30,000
Total annual income (HK$) | 360,000 | |
Arrangement of MPF contributions | MC only1 | MC + TVC2 |
Less: deduction for MC (HK$) | 18,000 | 18,000 |
Less: deduction for TVC (HK$) | N/A | 18,000 |
Income after deduction(s) (HK$) | 342,000 | 324,000 |
Less: basic allowance (HK$) | 132,000 | |
Net chargable income (HK$) | 210,000 | 192,000 |
Tax payable (HK$) | 17,700 | 14,880 |
Tax savings from TVC (HK$) | N/A | 2,820 |
Tony
Senior Specialist
Single
Monthly salary HK$60,000
Total annual income (HK$) | 720,000 | |
Arrangement of MPF contributions | MC only1 | MC + TVC3 |
Less: deduction for MC (HK$) | 18,000 | 18,000 |
Less: deduction for TVC (HK$) | N/A | 60,000 |
Income after deduction(s) (HK$) | 702,000 | 642,000 |
Less: basic allowance (HK$) | 132,000 | |
Net chargable income (HK$) | 570,000 | 510,000 |
Tax payable (HK$) | 78,900 | 68,700 |
Tax savings from TVC (HK$) | N/A | 10,200 |
Kelvin
Digital Marketing Manager
Married with 1 child (10 years old)
Monthly salary HK$60,000. Sponse not working
Total annual income (HK$) | 720,000 | |
Arrangement of MPF contributions | MC only1 | MC + TVC3 |
Less: deduction for MC (HK$) | 18,000 | 18,000 |
Less: deduction for TVC (HK$) | N/A | 60,000 |
Income after deduction(s) (HK$) | 702,000 | 642,000 |
Less: married person’s allowance | 264,000 | |
Less: child allowance | 120,000 | |
Net chargable income (HK$) | 318,000 | 258,000 |
Tax payable (HK$) | 36,060 | 25,860 |
Tax savings from TVC (HK$) | N/A | 10,200 |
Source: Inland Revenue and MPF Schemes Legislation (Tax Deductions for Annuity Premiums and MPF Voluntary Contributions) (Amendment) Bill 2018 gazetted - File Ref: INS/2/18C https://www.legco.gov.hk/yr18-19/english/bills/brief/b201812071_brf.pdf
1. The employee MPF MC is taken to be 5% of the employee’s monthly income, with a monthly maximum contribution limit set at HK$1,500.
2. For simplifying the examples, TVC is taken to be 5% of the employee’s monthly income, with a monthy maximum contribution limit set at HK$1,500.
3. To enjoy maximum tax concession of HK$10,200, TVC is taken to be maximum tax-deductible limit of HK$60,000* Meanwhile, the employee didn’t apply for the Qualified Deferred Annnuity Plan.
*This is the maximum tax concession amount in the year of assessment 2021/2022.
Note: The above illustrative examples are for reference only and does not constitute any form of advice.
HK$ 0.00
Your estimated savings in tax
All estimations and information provided is for general reference only and shall not be regarded or in any way indicative of your actual or final tax payable.
The customer should seek the professional tax adviser on how the implications on the TVC and the taxable allowance based on the customer’s specific scenario and profile, and subject to the tax assessment criteria provided by the IRD
To open a TVC account, you can either complete our online application form directly or download and complete the PDF application form(s), then submit to us.
Investment involves risks and past performance is not indicative of future performance. Investment return may rise as well as fall due to market condition and currency movement which may affect the value of investments. The value of units may vary due to changes in exchange rates between currencies. Emerging markets may involve a higher degree of risk than in developed markets and are usually more sensitive to price movements.
Issued by Sun Life Hong Kong Limited (Incorporated in Bermuda with limited liability)
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