### Inland Revenue Ordinance 《稅務條例》

40AE. Interpretation
In this Part—
amalgamated company (合併後公司) means—(a) a company—
(i) that amalgamates with one or more of its wholly owned subsidiaries under section 680 of the Companies Ordinance; and
(ii) the shares of which are not cancelled on the amalgamation; or
(b) a wholly owned subsidiary of a body corporate—
(i) that amalgamates with one or more of the other wholly owned subsidiaries of the body corporate under section 681 of the Companies Ordinance; and
(ii) the shares of which are not cancelled on the amalgamation;

amalgamating company (參與合併公司) means a company—(a) that is amalgamated in a qualifying amalgamation; and
(b) the shares of which are cancelled on the amalgamation;

body corporate (法人團體) has the meaning given by section 2(1) of the Companies Ordinance;
Companies Ordinance (《公司條例》) means the Companies Ordinance (Cap. 622);
company (公司) has the meaning given by section 2(1) of the Companies Ordinance;
date of amalgamation (合併日期), in relation to a qualifying amalgamation, means the effective date of the amalgamation specified in the certificate of amalgamation for the qualifying amalgamation under section 685(1) of the Companies Ordinance;
qualifying amalgamation (合資格合併) means an amalgamation of companies—(a) under section 680 or 681 of the Companies Ordinance; and
(b) for which a certificate of amalgamation has been issued by the Registrar of Companies under section 684(3) of the Companies Ordinance;

year of cessation (停業年度), in relation to an amalgamating company in a qualifying amalgamation, means the year of assessment in which the amalgamating company is treated as having ceased to carry on its trade, profession or business under section 40AG.

40AF. Application of Part 6C
This Part applies in relation to a qualifying amalgamation that takes effect on or after the date of commencement* of the Inland Revenue (Amendment) (Miscellaneous Provisions) Ordinance 2021 (18 of 2021).

Editorial Note:
* Commencement date: 11 June 2021.

40AG. Amalgamating company treated as having ceased to carry on trade, profession or business
For the purposes of this Ordinance, an amalgamating company in a qualifying amalgamation is treated as having ceased to carry on its trade, profession or business on the day immediately before the date of amalgamation.

### Inland Revenue Ordinance 《稅務條例》

40AH. Provisional profits tax for amalgamating company
Despite section 63H(1), an assessor may, having taken section 40AG into account, estimate the amount of provisional profits tax payable by an amalgamating company in a qualifying amalgamation for its year of cessation.

40AI. Provisional profits tax for amalgamated company
Despite section 63H(1), an assessor may estimate the amount of provisional profits tax payable by the amalgamated company in a qualifying amalgamation—
(a) for the year of assessment the basis period for which the date of amalgamation falls in; and
(b) for the succeeding year of assessment,
taking into account the succession of any trade, profession or business from any amalgamating company in the qualifying amalgamation.

40AJ. Obligations and liabilities of amalgamating companies
The amalgamated company in a qualifying amalgamation must comply with all obligations, and meet all liabilities, of each of the amalgamating companies under this Ordinance, for the year of cessation of the amalgamating companies and all preceding years of assessment.

40AK. Rights, powers and privileges of amalgamating companies
The amalgamated company in a qualifying amalgamation is entitled to all rights, powers and privileges of each of the amalgamating companies under this Ordinance, for the year of cessation of the amalgamating companies and all preceding years of assessment.

40AL. Returns for profits tax for amalgamating companies
Without limiting sections 40AJ and 40AK, the amalgamated company in a qualifying amalgamation must furnish a return for profits tax for each of the amalgamating companies for its year of cessation.

40AM. Election for Schedule 17J
(1) The amalgamated company in a qualifying amalgamation may, within 1 month after the date of amalgamation (or any further period that the Commissioner may allow), elect for Schedule 17J to apply to the amalgamated company and each amalgamating company in the qualifying amalgamation.
(2) If an election under subsection (1) is made, it must be made by the amalgamated company by notice in writing to the Commissioner.
(3) An election made under subsection (1) is irrevocable.
(4) If the condition specified in subsection (5) is met, the requirement under section 51(6) is regarded as having been complied with in respect of each amalgamating company in the qualifying amalgamation.
(5) The condition is that the amalgamated company has given the notice under subsection (2) within 1 month after the date of amalgamation.

### Inland Revenue Ordinance 《稅務條例》

40AN. Interpretation
In this Part—
amalgamating company (參與合併公司) has the meaning given by section 40AE;
qualifying amalgamation (合資格合併) has the meaning given by section 40AE;
specified asset (指明資產)—see section 40AO;
specified event (指明事件)—see section 40AP.

### Inland Revenue Ordinance 《稅務條例》

40AP. Meaning of specified event
A specified event is, in relation to any specified asset of a person (relevant person

40AQ. Application of Part 6D
This Part applies in relation to a specified event that occurs on or after the date of commencement* of the Inland Revenue (Amendment) (Miscellaneous Provisions) Ordinance 2021 (18 of 2021).

Editorial Note:
* Commencement date: 11 June 2021.

40AR. Non-application of certain provisions because of application of Part 6D
If this Part applies in relation to a person’s specified asset, sections 14IK(6), 16J(5B), 37(4), 38(4), 39B(7) and 39D(3) and (4) do not apply to the relevant person, or the other person, referred to in section 40AP in relation to the specified asset.
(Amended 5 of 2024 s. 18)

40AS. Deemed selling price of specified asset
(1) If a specified event occurs in relation to a person, the person’s specified asset is deemed to have been sold for a sum that is the lower of—
(a) a price that the Commissioner considers the specified asset would have been realized had it been sold in the open market at the time of the specified event; and
(b) if the specified asset is—
(i) an asset referred to in section 40AO(1)(a) or (b)—the total amount of deductions allowed to the person under section 16B for the expenditures incurred by the person; or
(ii) an asset referred to in section 40AO(1)(aa), (c), (d), (e), (f), (g), (h) or (i)—the capital expenditure incurred by the person. (Amended 5 of 2024 s. 19)
(2) For the purposes of subsection (1), if the asset mentioned in subsection (1)(b)(i) or (ii) is an asset succeeded by the person from an amalgamating company in a qualifying amalgamation, and an election has been made by the person under section 40AM(1)—
(a) the total amount of deductions allowed to the person mentioned in subsection (1)(b)(i) must also include the deductions allowed to the amalgamating company under section 16B; and
(b) the capital expenditure incurred by the person mentioned in subsection (1)(b)(ii) must also include the capital expenditure incurred by the amalgamating company.