Hong Kong profits tax, calculated.

Under the two-tiered system, corporations pay 8.25% on the first HK$2 million of assessable profits and 16.5% on the rest. Unincorporated businesses, such as sole proprietorships and partnerships, pay 7.5% on the first HK$2 million and 15% on the rest.

No. Where businesses are connected entities, such as companies under common control, only one of them can be nominated to use the two-tiered rates; the others pay the standard rate on all their profits. Untick the two-tier option to calculate a non-nominated entity.

Broadly, your business's Hong Kong-sourced profits after allowable deductions and any losses brought forward. Hong Kong taxes on a territorial basis, so profits that do not arise in or derive from Hong Kong are generally not chargeable to profits tax.

In some years the Budget reduces final profits tax for a particular year of assessment, up to a cap per case. Enter the cap for the year you are calculating to see the reduced amount, or leave it blank if none applies. Check the Inland Revenue Department's announcement for the exact figure.

No. It applies the published rates to the figure you enter. Working out assessable profits, deductions, connected-entity status and provisional tax is a job for your accountant or tax representative.