QDAP and TVC share one HK$60,000 deduction cap. See your saving and headroom.
Tax saving
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Deductible amount
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Headroom remaining
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Your breakdown
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One allowance, two products that share it
Hong Kong lets salaries-tax payers deduct two retirement-flavoured outlays: premiums on a Qualifying Deferred Annuity Policy (QDAP) and tax-deductible voluntary contributions (TVC) paid into your MPF. The point that catches people out is that these do not each get their own allowance. They draw on a single combined ceiling, which this calculator applies as HK$60,000 a year. You can fill that ceiling entirely with QDAP, entirely with TVC, or any mix of the two, but once the combined total reaches the cap, further premiums or contributions earn no extra deduction. Treat the HK$60,000 figure as the amount the tool models and confirm the current limit with the Inland Revenue Department and the MPFA, since the cap is set by policy and can be revised.
Why the split between them barely matters for tax
For the deduction itself, splitting HK$60,000 as 30,000 and 30,000, or as 60,000 and nothing, makes no difference: the deductible amount and the saving are identical because the cap is shared. Where the choice really bites is liquidity and purpose. TVC money is locked inside your MPF until age 65, like the rest of your mandatory pot, while a QDAP pays you a guaranteed stream of annuity income later and usually asks for a premium commitment over at least five years. So decide between them by what you want the money to do, not by chasing a larger deduction, because the tax relief is the same either way.
A full HK$60,000 claim at the top rate
Run the defaults: HK$30,000 of QDAP premiums and HK$30,000 of TVC, with a 17 percent marginal band. The combined HK$60,000 sits exactly on the cap, so the whole amount is deductible and the saving is 17 percent of it.
The HK$10,200 is tax you do not pay, not a cash rebate, so its real worth tracks your marginal band. At the lowest 2 percent band the same HK$60,000 deduction is worth only HK$1,200, which is why the relief matters most to higher earners taxed near the standard rate. The marginal-band figures here are the ones the calculator applies, so check the current salaries-tax bands with the IRD before you plan around them.
Paying past the cap costs cash flow, not tax
If you commit, say, HK$50,000 to a QDAP and HK$40,000 to TVC, your combined HK$90,000 is well over the ceiling. The deduction still stops at HK$60,000, so the extra HK$30,000 buys you no further tax relief that year. That money is not wasted in a wider sense, since the annuity and the MPF balance still belong to you, but if your only goal was the deduction you have tied up cash for no tax benefit. The headroom figure in the tool exists precisely to stop this: aim contributions at filling the HK$60,000, then direct anything beyond that to goals that are not capped.
Can a married couple each claim the HK$60,000?
Each taxpayer has their own allowance, so spouses who are separately assessed can each deduct up to the cap against their own income, provided each one actually pays the premiums or contributions being claimed. For QDAP there are also rules allowing premiums to be claimed by a spouse in some cases. Because the conditions are specific, confirm how your assessment and policy are structured with the IRD before splitting claims.
If I only pay TVC and no annuity, can I still use the whole allowance?
Yes. The HK$60,000 is a shared ceiling, not a requirement to use both products. You can fill it entirely with TVC, entirely with QDAP, or any combination. The calculator treats them as one pool, so a single TVC contribution of HK$60,000 produces the same deductible amount and saving as a 30,000 and 30,000 split.