Tax concessions are being considered for making the Hong Kong Special Administrative Region more attractive for family offices, Chief Executive Carrie Lam Cheng Yuet-ngor said on Wednesday delivering her annual Policy Address.
She said this would help improve “Hong Kong’s status as an international asset and wealth management center”.
Setting up of family offices has been increasing as a result of the burgeoning assets of ultra-high net worth families in the wake of loose monetary policy adopted by global central banks and a greater preference among the wealthy to mind their own financial and family affairs.
Also on Wednesday, Financial Secretary Paul Chan
Mo-po also said tax treatment is being reviewed to improve the city’s
attractiveness as a hub for family offices. He was addressing the online annual
summit of the Private Wealth Management Association.
Setting up of family offices has been increasing as a result of the burgeoning assets of ultra-high net worth families in the wake of loose monetary policy adopted by global central banks and a greater preference among the wealthy to mind their own financial and family affairs.
The Securities and Futures Ordinance (Cap. 571) does not define what a family office is.
The SFC has said single family offices need not be licensed. But they may be taxed based on their activity under the Securities and Futures Ordinance.
A multi-family office serving more than one wealthy family, for example, will need a license, while a license is not needed by a trustee that operates a family office internally for a family that appoints a trustee to hold a family trust’s assets.
In 2020, the regulator licensed 50 local family offices for regulated asset management.
In July last year, the Financial Services Development Council estimated that new family offices could generate 680 jobs annually, and also extra business spending of US$600 million.
Invest Hong Kong launched a dedicated office for family offices on June 29, this year in Admiralty, Hong Kong Island.
Hong Kong does offer a favorable tax regime for family offices. There is no tax on capital gain or offshore profits. Income from dividend is generally not taxable either.
