Legislative Council OKs bill allowing a tax deduction for domestic rents 

It is expected to benefit 430,000 taxpayers.

The Legislative Council has approved Inland Revenue Amendment Bill 2022, which will allow a tax deduction for domestic rent. The bill was amongst the measures proposed under the 2022-23 Budget.

Secretary for Financial Services & the Treasury Christopher Hui welcomed the bill's passage, adding that it will “ease the burden on taxpayers liable to salaries tax and tax under personal assessment who do not own any domestic property.”

Whilst about $3.3b per year will be foregone from the government's revenue, Hui said the bill’s implementation will benefit about 430,000 taxpayers.

Under the bill, the maximum amount of allowable deduction is $100,000 for each year of assessment. 

Eligible taxpayers can provide information about their expected domestic rent paid in relation to the year of assessment (YA) 2022-23 in the tax returns for YA 2021-2022.

The Inland Revenue Department will take into account the deduction when assessing the provisional salaries tax for YA 2022-2023.