VHIS tax deduction: HK$8,000 cap per insured person a year, whom you can claim for, and how it is calculated
From 1 April 2019, a taxpayer or spouse who is the policy holder of a VHIS certified plan can claim a tax deduction for premiums paid for themselves and specified relatives, capped at HK$8,000 per insured person per year of assessment; the insured person must be a Hong Kong resident. At the 17% tax rate, the most tax saved per insured person is HK$1,360.
What are the conditions for the VHIS tax deduction?
Several conditions must all be met: from 1 April 2019, the Inland Revenue Ordinance (Cap. 112) introduced a concessionary tax deduction under salaries tax and personal assessment; the taxpayer or spouse must be the policy holder of a certified plan, the insured person must be the taxpayer or a specified relative, and the maximum deduction per insured person per year of assessment is HK$8,000.
The insured person must be a Hong Kong resident, which includes holders of a Hong Kong Identity Card and children under 11 who do not hold a Hong Kong Identity Card but whose parent held one when they were born or adopted (Health Bureau VHIS tax deduction webpage).
When a policy contains both a certified plan and a life insurance plan, only the premiums relating to the certified plan can be claimed (Health Bureau VHIS tax deduction webpage).
Taxpayers should keep the premium receipts or annual premium statements issued by the product provider as supporting documents.
Which family members can I claim for?
You can claim for ‘specified relatives’: specified relatives are the policy holder's spouse; children and siblings who are under 18, or aged 18 to under 25 and receiving full-time education, or unable to work because of physical or mental incapacity; and parents or grandparents (paternal or maternal) who are aged 55 or over, or under 55 but eligible to claim an allowance under the Government's Disability Allowance Scheme (step and adoptive relationships both apply); specified relatives also include the taxpayer's or his/her spouse's grandparents (paternal and maternal), parents and siblings (Health Bureau VHIS tax deduction webpage).
Claiming a deduction for premiums paid for a specified relative has no direct connection with claiming an allowance for that relative (for example dependent parent allowance) (Inland Revenue Department FAQs).
How are multiple insured persons, multiple policies or multiple taxpayers counted?
The cap is counted ‘per taxpayer, per insured person’: the table below sets out the rules in the Inland Revenue Department's FAQs.
| Situation | Inland Revenue Department rule |
|---|---|
| Insuring more than one person | HK$8,000 cap per insured person; for example, if you pay HK$10,000, HK$6,000 and HK$2,000 for yourself, your spouse and your child respectively, you can deduct HK$16,000 in total |
| More than one policy for the same insured person | The premiums can all be claimed, with a total deduction cap of HK$8,000 |
| More than one taxpayer insuring the same person | Each can claim separately in the same year of assessment, up to HK$8,000 per taxpayer per insured person |
| A policy with more than one policy holder | The premiums are treated as paid by all policy holders in equal shares |
| Paying premiums on someone else's behalf | Only a taxpayer who is the policy holder, or the taxpayer's spouse living with them, can claim; premiums paid by a spouse not living with the taxpayer cannot be claimed |
| A married couple claiming for the same insured person | Neither may exceed HK$8,000, and their total deduction may not exceed the premiums paid |
How much tax can the deduction save?
It depends on the applicable tax rate: from the year of assessment 2024/25 the two-tiered standard rates are 15% and 16%, and the progressive rates are 2%, 6%, 10%, 14% and 17% (Health Bureau VHIS tax deduction webpage); the tax saved equals the deductible premium multiplied by the applicable rate, for example at 17% a HK$8,000 deduction saves HK$1,360.
Taxpayers paying tax at the standard rate can also claim the deduction: the net premiums paid are first deducted from the assessable income or total income, and the balance is then taxed at the progressive or standard rate (Inland Revenue Department FAQs).
What happens with refunded or late premiums?
It is based on what was actually paid, net: only the net amount of premiums paid can be claimed; if premiums are refunded after a deduction has been claimed, the Commissioner of Inland Revenue must be notified in writing within 3 months after the date of the refund (Inland Revenue Department FAQs).
The deduction is claimed for the year of assessment in which the premium is actually paid; for example, a premium due on 30 March 2026 but paid on 2 April 2026 can be claimed only in the year of assessment 2026/27 (Inland Revenue Department FAQs).
For individual cases, see the Inland Revenue Department's FAQs or ask the Department; for the VHIS cover rules, see VHIS basic rules.
Frequently asked questions
What is the VHIS tax deduction cap?
The maximum deduction per insured person per year of assessment is HK$8,000; if the same insured person has more than one policy, the total deduction cap is still HK$8,000.
Can I buy VHIS for my parents and claim a tax deduction?
Yes, if your parents are specified relatives: these include parents or grandparents (paternal or maternal) aged 55 or over, or under 55 but eligible to claim an allowance under the Government's Disability Allowance Scheme; the spouse's parents and grandparents (paternal and maternal) are also specified relatives, and the insured person must be a Hong Kong resident (Health Bureau VHIS tax deduction webpage).