What useful life should be considered when estimating the TAB factor of an intangible asset?

Amortisation of intangible assets is not always tax deductible. Its deductibility depends on the corporate income tax legislation of single countries. Most countries define maximum amortisation rates or minimum number of years in which the amortisation of intangible assets can be deducted, if at all. This page displays the legal tax amortisation periods of the main types of intangible assets.

Summary Table

CountryPatentsTechnologyTrademarkCustomer relationships GoodwillLast update
Hong Kong115no TABno TABApr 2016

Further Detail and Source Legislation

Capital expenditure generally is not deductible for Hong Kong tax purposes.
However, to promote and direct capital expenditure towards specific areas, the government grants accelerated depreciation allowances on plant and machinery, as well as special deductions on the following:[1]

  1. expenditure (subject to specific deduction criteria) on R&D;
  2. payments for technical education; the purchase and sale of patent rights or rights to know-how, for use in the production of chargeable profits;
  3. the purchase of copyrights, registered designs and registered trademarks (a deduction over five years);
  4. expenditure for building refurbishment;
  5. capital expenditure on the provision of prescribed fixed assets, including manufacturing machinery and computer hardware and software; and
  6. capital expenditure on environmentally friendly vehicles.

Patent rights and know-how can be deducted when the expenditure in incurred if the right for use its solely in Hong Kong.[2]

  1. ^ Taxation and Investment in Hong Kong 2012, Deloitte
  2. ^ Departmental Interpretation and Practice Notes, Inland Revenue Department of Hong Kong

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