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What is Tax Deductible Voluntary
Contributions 

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reserves, so it is subject to the preservation requirement applicable to mandatory contributions and can only be withdrawn upon scheme member's reaching age 65 or on other statutory grounds under the MPF legislation.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.

Key Features of TVC

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.

How much can you save?

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.

 

TVC Tax Deduction Calculator
 

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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

Are you an existing TVC account holder?

Existing Sun Life TVC account members have the option to make more contributions to their existing account.

  Make more contributions to my TVC account

You are an existing TVC account member from another MPF scheme and want to transfer your TVC benefits to Sun Life.

  Open a TVC account at Sun Life

  Transfer your TVC benefits to Sun Life

Frequently Asked Questions

TVC is a simple, convenient and flexible arrangement for retirement savings. Eligible persons can open TVC accounts in any MPF schemes which offer such accounts and make contributions directly to the accounts.

Tax concessions on TVC starts from 1 April 2019. Eligible persons can claim deductions when you fill in the tax return for the year of assessment 2019/20 for your TVC made from 1 April 2019 to 31 March 2020.

The following persons are eligible to open a TVC account in an MPF scheme:

  • a current employee member of an MPF scheme;
  • a current self-employed person member of an MPF scheme;
  • a current personal account holder of an MPF scheme;
  • a current member of an MPF exempted ORSO scheme

You can open a TVC account and make contributions directly to the account. You can then enjoy tax deduction under salaries tax or tax under personal assessment for your TVC. The maximum tax deduction cap for the year of assessment 2019/2020 is HK$60,000, which is an aggregate limit for TVC and qualifying annuity premium.

If you have more than one TVC account, the maximum tax deduction cap applies to the total amount of contributions of all of your TVC accounts. To facilitate your filing of tax return, MPF trustee will provide a TVC contribution summary to you each year.

  Employee Voluntary Contributions (EEVC) Special Voluntary Contributions (SVC) Tax Deductible Voluntary Contributions (TVC)
Account opening
  • Set up an account under the MPF scheme chosen by your employer
  • Set up an account under your preferred MPF scheme
  • Set up an account under your preferred MPF scheme
Contribution Arrangement
  • Contribution amount is based on your income
  • Make regular contributions via your employer
  • Regular or lump-sum contributions and suspension of contributions is allowed
  • Contributions are paid to the trustee directly
  • Regular or lump-sum contributions and suspension of contributions is allowed
  • Contributions are paid to the trustee directly
Benefits Transfer
  • Benefits can be transferred only after ceasing employment
  • Benefits can be transferred anytime
  • Benefits can be transferred anytime
Benefits Withdrawa
  • Subject to the terms of your MPF scheme or you can withdraw the benefits only after ceasing employment
  • You can withdraw the benefits anytime, subject to a maximum withdrawal amount set by the trustee
  • Benefits are required to preserve upon reaching 65 years of age (or on other statutory grounds)
Tax Benefits
  • Contributions are not eligible for tax deduction
  • Contributions are not eligible for tax deduction
  • Contributions are tax deductible and capped at HK$60,000*
  • The maximum amount of tax savings is HK$10,200*

You can transfer all balance in a TVC account to another TVC account under a different scheme at any time. If you wish to transfer the balance in a TVC account to another MPF scheme, all you need to do is to fill in the "Scheme Member's Request for Transfer of Tax Deductible Voluntary Contributions" (Form MPF(S)-P(T)) and then send it to your new scheme trustee, the form can be obtained from MPF trustee or MPFA.

To meet the purpose of encouraging extra savings for retirement, TVC will be subject to the same preservation requirements of mandatory contribution. You can only withdraw TVC account balance upon reaching 65 years of age, or on other statutory grounds. Contributions exceeding the tax deduction cap cannot be withdrawn early either.

Withdrawal arrangement of TVC is the same as that of mandatory contribution. You should submit the completed claim form to your MPF trustee and provide the supporting documents required.

Similar to other types of contributions, you have the right to choose the constituent funds offered by the MPF scheme. If you have not given any investment instructions, your TVC will be invested according to the Default Investment Strategy for your investment.

The current tax deductions for mandatory contributions will not be affected by the implementation of TVC. The existing maximum amount deductible for mandatory contributions (HK$18,000) will not be affected after the implementation of TVC.

Open a TVC Account

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Application forms

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.

Online Application   Download Form

 

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Disclaimer

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.

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