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Hong Kong Increases Interest on Tax Reserve Certificates — Orbitax Tax News & Alerts

The Hong Kong Inland Revenue Department has announced an increase in the annual rate of interest payable on Tax Reserve Certificates from a rate of 0.3167% to a rate of 0.4000% with effect from 5 December 2022. Tax Reserve Certificates bear simple interest, which is calculated monthly (including part of a month) from the date of purchase to the date of payment of tax. Interest is only credited when certificates are used to pay tax and no interest is due where the principal value of a certificate is repaid to its holder. The new rate applies to all certificates purchased on or after 5 December 2022. Certificates purchased before 5 December 2022, will continue to earn interest at the rates prevailing on their respective purchase dates:

  • For certificates purchased on or after 7 April 2021, and before 3 May 2021: 0.1167% per annum
  • For certificates purchased on or after 3 May 2021, and before 7 June 2021: 0.0833% per annum
  • For certificates purchased on or after 7 June 2021, and before 6 June 2022: 0.0500% per annum
  • For certificates purchased on or after 6 June 2022, and before 3 October 2022: 0.1333% per annum
  • For certificates purchased on or after 3 October 2022, and before 7 November 2022: 0.1750% per annum
  • For certificates purchased on or after 7 November 2022, and before 5 December 2022: 0.3167% per annum
  • For certificates purchased on or after 5 December 2022, until further notice: 0.4000% per annum

Interest on Tax Reserve Certificates is always subject to the general rule that interest ceases to accrue after 36 complete months.