### Inland Revenue Ordinance 《稅務條例》

14H. Concession for qualifying aircraft lessor
(Amended 10 of 2022 s. 2)(1) For the purposes of this Part and subject to subsections (4) and (6), the assessable profits of a corporation that is a qualifying aircraft lessor for a year of assessment are chargeable to tax under this Part at one-half of the rate specified in Schedule 8 to the extent to which those profits are assessable profits derived from its qualifying aircraft leasing activity. (Amended 27 of 2018 s. 28; 5 of 2024 s. 4)
(2) A corporation is a qualifying aircraft lessor for a year of assessment if, in the basis period for that year of assessment—
(a) it is not an aircraft operator;
(b) it has carried out in Hong Kong one or more qualifying aircraft leasing activities; and
(c) it has not carried out in Hong Kong any activity other than a qualifying aircraft leasing activity.
(3) For the purposes of subsection (2)(c), in determining whether a corporation has carried out any activity other than a qualifying aircraft leasing activity, only activities that generate income to the corporation are to be taken into account.
(4) Subsection (1) applies to a corporation for a year of assessment only if—
(a) in that year of assessment—
(i) the central management and control of the corporation is exercised in Hong Kong;
(ii) the activities that produce its qualifying profits in that year are—
(A) carried out in Hong Kong by the corporation; or
(B) arranged by the corporation to be carried out in Hong Kong; and
(iii) those activities are not carried out by a permanent establishment outside Hong Kong; and
(b) the corporation has elected in writing that subsection (1) applies to it.
(5) An election under subsection (4)(b), once made, is irrevocable.
(6) If subsection (1) does not apply to a corporation for a year of assessment (cessation year

14HA. Carrying out of activities in Hong Kong—supplementary provisions for section 14H(4)(a)(ii)
(1) For the purposes of section 14H(4)(a)(ii), an activity producing the assessable profits of a corporation that fall within section 14H(1) for a year of assessment is not considered to be carried out in Hong Kong by the corporation or arranged by the corporation to be carried out in Hong Kong in that year of assessment unless the requirements prescribed in section 5 of Schedule 17F (prescribed requirements

### Inland Revenue Ordinance 《稅務條例》

14HB. Calculation of assessable profits of corporation derived from qualifying aircraft leasing activity for purposes of section 14H(1)
(1) This section applies to a corporation for a year of assessment if section 14H(1) applies to the corporation for that year of assessment (particular year

14I. Calculation of net lease payments for right to use aircraft under operating lease: aircraft acquired in year of assessment preceding year of assessment beginning on 1 April 2023
(Amended 10 of 2022 s. 2; 5 of 2024 s. 6)(1) Subject to section 14IA, this section applies to a corporation for a year of assessment (particular year

14IA. Circumstances under which section 14I does not apply
(1) Section 14I does not apply to a corporation for a year of assessment in respect of a qualifying aircraft leasing activity carried out by the corporation in relation to an operating lease of an aircraft (specified aircraft

14IB. Calculation of net lease payments for right to use aircraft under operating lease: aircraft acquired in year of assessment beginning on or after 1 April 2023 and certain other aircraft
(1) This section applies to a corporation for a year of assessment (particular year

14IC. Deduction of certain capital expenditure incurred in relation to aircraft
(1) Despite section 17, this section applies to a corporation for a year of assessment (particular year

14ID. Supplementary provisions for section 14IC(3)
(1) This section applies for the purposes of section 14IC(3).
(2) The formula referred to in section 14IC(3) is—

A = B – C – D – E – F   where:  A  means the specified capital expenditure incurred in relation to the aircraft concerned (specified aircraft

14IE. Supplementary provisions for section 14IC(4)
(1) This section applies for the purposes of section 14IC(4).
(2) The formula referred to in section 14IC(4) is—

J = K – L   where:  J  means the specified capital expenditure incurred in relation to the aircraft concerned (specified aircraft

14IF. Circumstances under which capital expenditure is not allowed to be deducted under section 14IC
(1) Section 14IC does not apply to a corporation in relation to an aircraft (specified aircraft

### Inland Revenue Ordinance 《稅務條例》

14IG. Meaning of capital expenditure (aircraft)—for sections 14IC, 14ID, 14IE and 14IF
(1) This section applies for the purposes of sections 14IC, 14ID, 14IE and 14IF.
(2) Any capital expenditure incurred by a corporation in relation to an aircraft is capital expenditure (aircraft) in relation to the aircraft.
(3) Capital expenditure incurred by a corporation in relation to an aircraft includes—
(a) any consideration for the acquisition of the aircraft made by the corporation; and
(b) any legal expenses and valuation fees incurred by the corporation in connection with the acquisition.
(4) However, neither the expenditure mentioned in paragraph (a) nor the expenditure mentioned in paragraph (b) is capital expenditure incurred by a corporation in relation to an aircraft—
(a) any expenditure incurred in relation to the aircraft that is reimbursed to the corporation by way of or attributable to a grant, subsidy or similar financial assistance;
(b) any capital expenditure incurred by the corporation that has been deducted or may be deducted in relation to the aircraft under any section (other than section 14IC) in this Part.
(5) If the aircraft is acquired together with any other assets in pursuance of one bargain, then for determining the actual amount of the consideration for the acquisition, the Commissioner must, having regard to all the circumstances of the bargain, allocate an amount of the consideration for the acquisition of the aircraft.
(6) If the Commissioner is of the opinion that the consideration for the acquisition of the aircraft does not represent the true market value of the aircraft at the time of the acquisition—
(a) the Commissioner may determine the true market value of the aircraft; and
(b) the amount so determined is to be taken to be the consideration for the acquisition.
(7) If a corporation begins to use an aircraft, for the carrying out of any qualifying aircraft leasing activity, in a particular year of assessment after the year of assessment in which the acquisition takes place, any capital expenditure (aircraft) incurred in relation to the aircraft by the corporation before the particular year of assessment is to be regarded as being incurred by the corporation in the particular year of assessment by the corporation.
(8) If any capital expenditure (aircraft) in relation to the aircraft (expenditure

14IH. Consideration for disposal of aircraft etc. to be regarded as trading receipts of corporation—aircraft in respect of which no election has been made under section 14IA(1)(e)
(1) This section applies to a corporation if—
(a) section 14I applies to the corporation in relation to an aircraft (specified aircraft