{"id":5312,"date":"2026-03-13T02:39:34","date_gmt":"2026-03-13T02:39:34","guid":{"rendered":"https:\/\/titus.com.hk\/?p=5312"},"modified":"2026-03-13T06:05:34","modified_gmt":"2026-03-13T06:05:34","slug":"dipn-61-hong-kong-profits-tax-exemption-for-funds","status":"publish","type":"post","link":"https:\/\/titus.com.hk\/zh\/dipn-61-hong-kong-profits-tax-exemption-for-funds\/","title":{"rendered":"DIPN 61 Explained (Plain English): Hong Kong\u2019s Profits Tax Exemption for Funds (\u201cUnified Fund Exemption\u201d)"},"content":{"rendered":"\n<p>Last updated: 13 March 2026<\/p>\n\n\n\n<p>DIPN 61 is the Inland Revenue Department\u2019s \u201cDepartmental Interpretation and Practice Note\u201d explaining how it interprets and applies Hong Kong\u2019s profits tax exemption for funds (often called the \u201cunified fund exemption\u201d).<\/p>\n\n\n\n<p>If you are advising a fund manager or a private capital group operating in Hong Kong, this note matters\u2014not because it guarantees an outcome, but because it signals how the IRD views key concepts and conditions.<\/p>\n\n\n\n<p>If you want help applying this to a specific structure, start here:<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-titus wp-block-embed-titus\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"Gdbd8B8XAp\"><a href=\"https:\/\/titus.com.hk\/investment-funds\/\">INVESTMENT FUNDS<\/a><\/blockquote><iframe class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; visibility: hidden;\" title=\"&#8220;INVESTMENT FUNDS&#8221; &#8212; Titus\" src=\"https:\/\/titus.com.hk\/investment-funds\/embed\/#?secret=yH9ddfiecl#?secret=Gdbd8B8XAp\" data-secret=\"Gdbd8B8XAp\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What DIPN 61 is (and what it isn\u2019t)<\/h2>\n\n\n\n<p>DIPN 61 is:<\/p>\n\n\n\n<p>&#8211; IRD guidance on interpretation and application of the funds profits tax exemption regime.<\/p>\n\n\n\n<p>DIPN 61 is not:<\/p>\n\n\n\n<p>&#8211; a blanket promise that \u201cfunds pay zero tax\u201d,<\/p>\n\n\n\n<p>&#8211; a substitute for analysing facts, activities, and structure design.<\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Why people search \u201cDIPN 61\u201d in the first place<\/h2>\n\n\n\n<p>Typically, the question behind the search is:<\/p>\n\n\n\n<p>\u201cCan my fund (or private investment platform) operate in Hong Kong without creating unexpected profits tax exposure?\u201d<\/p>\n\n\n\n<p>In practice, the answer depends on:<\/p>\n\n\n\n<p>&#8211; whether you meet the definition of \u201cfund\u201d for the relevant provisions,<\/p>\n\n\n\n<p>&#8211; the nature of transactions,<\/p>\n\n\n\n<p>&#8211; who carries out or arranges transactions,<\/p>\n\n\n\n<p>&#8211; how the structure is operated in real life.<\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Three common misconceptions<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Misconception 1: \u201cIf it\u2019s a fund, it\u2019s automatically exempt\u201d<\/h3>\n\n\n\n<p>Not necessarily. The regime is condition-based and fact-driven.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Misconception 2: \u201cDomicile solves everything\u201d<\/h3>\n\n\n\n<p>DIPN 61 makes clear the regime is intended to cover privately offered funds operating in Hong Kong, whether domiciled inside or outside Hong Kong\u2014subject to conditions. Domicile is not the only variable.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Misconception 3: \u201cWe\u2019ll deal with tax after launch\u201d<\/h3>\n\n\n\n<p>This is where problems start. If documents, operations and governance don\u2019t match, you create unnecessary risk.<\/p>\n\n\n\n<p>That\u2019s also why we push \u201cbankable structure\u201d thinking early:<\/p>\n\n\n\n<p>\u00a0<a href=\"https:\/\/titus.com.hk\/bankable-hong-kong-fund-structures-aml-controls\/\">How to build a \u201cbankable\u201d Hong Kong fund (AML, records, controls)<\/a><\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Practical takeaway: how to use DIPN 61 in real structuring work<\/h2>\n\n\n\n<p>We typically use DIPN 61 as part of a larger \u201cdesign pack\u201d:<\/p>\n\n\n\n<p>&#8211; define whether the structure is truly operating as a fund,<\/p>\n\n\n\n<p>&#8211; map how transactions are sourced, executed and documented,<\/p>\n\n\n\n<p>&#8211; ensure agreements reflect actual operations,<\/p>\n\n\n\n<p>&#8211; design governance and record-keeping so you can evidence reality.<\/p>\n\n\n\n<p>If you\u2019re still choosing between LPF vs OFC vs a holding\/SPV stack, read:<\/p>\n\n\n\n<p>\u00a0<a href=\"https:\/\/titus.com.hk\/hong-kong-funds-private-investment-vehicles-guide\/\">Hong Kong Funds &amp; Private Investment Vehicles guide<\/a><\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Next step: quick call with our Principal<\/h2>\n\n\n\n<p>If you want to discuss a client fact pattern or your firm\u2019s recurring needs, we can set up a quick Zoom call with Michael Titus (Principal, TITUS): https:\/\/titus.com.hk\/our-people\/michael-titus\/<\/p>\n\n\n\n<p>Send 2\u20133 time slots to us via:<br><strong>Email:<\/strong> <a href=\"mailto:info@titus.com.hk\">info@titus.com.hk<\/a>, or<br><strong>Whatsapp:<\/strong> <a href=\"https:\/\/wa.me\/85297203003\">+852 9702 3003<\/a><\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<p><strong>Disclaimer<\/strong>: This article is for general information only and does not constitute legal advice. Specific advice should be sought for your particular circumstances.<\/p>\n\n\n\n<p><strong>RELATED READING<\/strong><\/p>\n\n\n\n<p>&#8211; Investment Funds practice: <a href=\"https:\/\/titus.com.hk\/investment-funds\/\">Investment Funds practice page<\/a><\/p>\n\n\n\n<p>&#8211; LPF guide: <a href=\"https:\/\/titus.com.hk\/the-limited-partnership-fund-lpf-in-hong-kong-a-complete-guide\/\">LPF (Limited Partnership Fund) guide<\/a><\/p>\n\n\n\n<p>&#8211; OFC guide: <a href=\"https:\/\/titus.com.hk\/the-open-ended-fund-company-ofc-in-hong-kong-what-you-need-to-know\/\">OFC (Open-Ended Fund Company) guide<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Last updated: 13 March 2026 DIPN 61 is the Inland Reven [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":5313,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"off","_et_pb_old_content":"","_et_gb_content_width":"","_vp_format_video_url":"","_vp_image_focal_point":[],"footnotes":""},"categories":[11,4,8,171],"tags":[],"class_list":["post-5312","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-article","category-blog","category-commercial-law","category-investment"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.0 - 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