Enhanced Aircraft Leasing Preferential Tax Regime

This legislation, gazetted on 17 November 2023, aims to enhance the existing aircraft leasing preferential tax regime in Hong Kong. Key proposals include a one-off 100% deduction of the acquisition cost of aircraft in the year of acquisition under certain conditions, extension of the definition of a qualifying lease to cover various lease types, allowance for interest deduction on loans from overseas associates for aircraft acquisition, and the introduction of a substantial activities threshold to align with OECD requirements. The legislation is retroactively effective for financial years ending on or after 1 April 2023.