The 2024-25 Budget introduced by the Financial Secretary includes two pivotal tax initiatives designed to relieve financial pressure on businesses—specifically, a new tax deduction for reinstatement costs of leased premises and the elimination of the time limit for claiming allowances on commercial and industrial buildings.

 

These measures are particularly pertinent for companies that frequently relocate or renovate their operational spaces, as they address the challenges posed by current tax framework where reinstatement costs are treated as non-deductible capital expenditures. Additionally, the removal of time limits for commercial building allowance and industrial building allowance will create a more equitable tax treatment for property transactions.

 

This newsletter will delve into the specifics of these proposed tax changes and their implications for businesses. By understanding these amendments, businesses can better navigate the evolving tax environment and optimize their financial strategies related to the property market in Hong Kong.

 

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