Guidance on Tax Treatment of Gains from Mandatory Provident Fund Contributions in Hong Kong

Hi HMRC, I am writing to seek guidance regarding the tax treatment of gains derived from my Mandatory Provident Fund (MPF) contributions in Hong Kong. In Hong Kong, the MPF scheme requires both employers and employees to make mandatory contributions of 5% of the employee’s relevant income, up to a statutory cap of HKD 1,500 per month. However, my employer’s policy requires that employees contribute 5% of their income to the MPF account, regardless of the statutory cap, and my employer matches this contribution. As a result, my contributions to the MPF include both mandatory (capped at HKD 1,500 per month) and voluntary components (the amount exceeding the statutory cap). I would like to understand the tax treatment of gains from the voluntary contributions within the MPF scheme. Specifically, I need clarification on: 1. Whether gains from voluntary MPF contributions need to be reported in my UK tax return. 2. The correct procedure for reporting these gains, if required. I appreciate your assistance in this matter.

Hi,

The following guidance advises that government pensions are taxable only in the source state. As the source state is Hong Kong, they will not be taxable in the UK.

DT9203 - Double Taxation Relief Manual: Guidance by country: Hong Kong: Treaty summary

Thank you.