ESTATE DUTY ORDINANCE

ESTATE DUTY ORDINANCE

LAWS OF HONG KONG

ESTATE DUTY ORDINANCE

CHAPTER 111





CHAPTER 111

ESTATE DUTY ORDINANCE

ARRANGEMENT OF SECTIONS

Section .................................. Page

1. Short title................................ ... ... ... ... ... ... ... ... 3
2. Application................................ ... ... ... ... ... ... ... 3

3. Interpretation...................... ... ... ... ... ... ... ... ... ... 3

3A. Exercise of powers and duties ... ... ... ... ... ... ... ... 9
4. Appointment as commissioner for oaths ..... ... ... ... ... ... ... ...
9

5. Estate duty . ............................ ... ... ... ... ... ... 10

6. What property is deemed to pass on death ... ... ... ... ... ... ... ... 10

7. Dispositions in favour of relatives .... ... ... ... ... ... ... ... ... 16
7A.....................Presumption of simultaneous death ... ... ... ... ... ... ... ... ... 17

8. Exemptions ................................ ... ... . ... ... ... 17

9. Accretions to gifts inter vivos ........ ... ... ... ... ... ... ... 19

10. Exceptions for transactions for money consideration, property situate outside the

Colony. shares on local registers and certain land in the New Territories ... 20

1 0A. Exception for matrimonial home ... ... ... ... ... ... ... ... ... ... -II

11................Aggregation of property .... . ... ... ... ... ... ... ... ... ... 22

12..................Payment of estate duty; etc. ... ... ... ... ... ... ... ... ... ... 11

13..............Value of property etc . ...... ... ... ... ... ... ... ... ... ... ... ... 25

14..................Recovery of estate duty; etc. ... ... ... ... ... ... ... ... ... ... 27

14A. Exemption of executors of small estates ... ... ... ... ... ... ... ... 31

15...........................Probate not to be issued until estate duty paid etc . ... ... ... ... ... ... 32
16. Increase of estate duty when delay in lodging affidavit 32

17. Duty of executor as to unregistered shares ... ... ... ... ... ... ... ... 33

18. Charge of estate duty on property etc . ... ... ... ... ... ... ... ... 33

19. Apportionment of estate duty; etc . ... ... .. ... ... ... ... ... ... ... 34

20. Remission and refunding of estate duty on certain grounds. Proviso regarding

war deaths ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 35

21.1 Remission in case of successive war deaths ... ... ... ... ... ... ... ... 35

22. Appeal to Supreme Court; etc . ... ... ... ... ... ... ... ... ... ... ... 36

23. Schedule of properly to be annexed to probate ... ... ... ... ... ... 17

24. Penalties for intermeddling ... ... ... ... ... ... ... ... ... ... ... ... 37







25. Notification of interest of deceased person in bank or business undertaking ... 39

26. Executor's accounts ... ... ... ... ... ... ... ... ... ... ... ... 39

27. Power to reduce penalty and duty ... ... ... ... ... ... ... ... ... ... 39

28. Power to Governor in Council to make rules and prescribe forms, fees and

charges ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 40

29. Presumption as to shares standing in the name of the deceased; appeal ... ... 40

30. Relief in the case of certain settlements ... ... ... ... ... ... . ... ... 40

31. Relief in respect of quick succession where property consists of leasehold property

or a business ... ... . ... ... ... ... ... .... ... ... ... ... ... 40





Section Page

32. Reduction of full amount of duty where the margin above the limit of value is

small ................................ ... ... ... ... ... ... ... ... 41

33. Relief in the case of certain interests which do not fall into possession ... ... 41

34. Controlled companies ...................... ... ... ... ... ... ... ... 41

35. Charge on assets of controlled companies: etc. ... ... ... ... ... ... ... 44

36. Benefits from company to deceased .... ... ... ... ... ... ... 45

37. Surrender of benefits; etc . .............. .. ... ... ... ... ... ... ... 45

38. Determination of net profits of company ... ... ... ... ... ... ... ... 46
39. Allowances in the valuation of assets: etc. ... ... ... ... ... ... ... ... 47

40. Limitation on charge: etc . ............... ... ... ... ... ... ... ... ... 48

41. Limitation of exceptions .......... ..... ... ... ... ... ... ... 51

42. Duty to give information on death; penalty ... ... ... ... ... ... 51

43. Collection and incidence of duty: etc. .... ... .1. ... ... 52

44. Value of shares and debentures of controlled companies etc. ... ... ... ... 54

45. Limitation on dispositions through a controlled company in favour of relatives;

etc...................................... ... ... ... ... ... ... 58

First Schedule.......................Duty applicable to deaths before 27 February 1931 ... ... ... 59

Second Schedule. Duty applicable to deaths on or after 27 February 1931 and before

1 July 1936 ....................... ... ... ... ... ... ... 59

Third Schedule. Duty applicable to deaths on or after 1 July 1936 and before 1 April

1941 ........................... ... ... ... ... ... ... 60

Fourth Schedule. Duly applicable it) deaths on or after 1 April 1941 and before 1 April

1 948 .......................... ... ... ... ... ... 60

Fifth Schedule. Duty applicable to deaths on or after 1 April 1948 and before

1 February 1959 ................... ... ... ... ... ... 61

Sixth Schedule. Duty applicable to deaths on or after 1 February 1959 and before

1 January 1963 ...... ......... ... ... ... ... ... 62

Seventh Schedule. Duly applicable to deaths on or after 1 January 1963 and before

1 April 1967 ... ... ... ... ... ... '' ... ... 62

Eighth Schedule. Duty applicable to deaths on or after 1 April 1967 and before 1 April

1970 ... ... ... ... ... ... ... ... . ... ... ... 63

Ninth Schedule. Duly applicable to deaths on or after 1 April 1970 and before the







1 April 1972 ... ... ... ... ... ... ... ... ... ... ... 63

Tenth Schedule. Duty applicable to deaths on or after 1 April 1972 and before the

1 April 1974 ... ... ... ... ... 64

Eleventh Schedule.Duty applicable to deaths on or after 1 April 1974 and before the
commencement of the Estate Duty (Amendment) Ordinance 1976 64
Twelfth Schedule.Duty applicable to deaths on or after the commencement of the
Estate Duty (Amendment) Ordinance 1976 and before the corn-

mencement of the Estate Duty (Amendment) Ordinance 1977 65
Thirteenth Schedule.Duly applicable to deaths on or after the commencement of the
Estate Duty (Amendment) Ordinance 1977 and before the com-
mencement of the Estate Duty (Amendment) Ordinance 1980 65
Fourteenth Schedule.Duly applicable to deaths on or after the commencement of the
Estate Duty (Amendment) Ordinance 1980 and before the corn-
mencement of the Estate Duty (Amendment) Ordinance 1981 66
Fifteenth Schedule.Duty applicable to deaths on or after the commencement of the
Estate Duty (Amendment) Ordinance 1981 and before the com-
mencement of the Estate Duty (Amendment) Ordinance 1982 66
Sixteenth Schedule.Duty applicable to deaths on or after the commencement of the

Estate Duty, (Amendment) Ordinance 1982 ... ... ... ... ... 66
Seventeenth Schedule. Provisions supplementary to sections 34 Lo 45 inclusive ... ... ... 67





CHAPTER 111

ESTATE DUTY

To amend and consolidate the law relating to estate duty.

[26 February 1932.1

1. This Ordinance may be cited as the Estate Duty Ordinance.

2. This Ordinance shall apply in the case of every deceased person
dying or who shall have died on or after 1 January 1916; and it shall also
apply in the case of every deceased person who shall have died before
that date if representation to his estate has not been applied for before 2
May 1921.

3. (1) In this Ordinance, unless the context otherwise requires

,,account' means an account of the particulars and value of the estate
of a deceased person in such form as may be prescribed by the
Governor in Council, and verified by affidavit;

'affidavit for the Commissioner' means an affidavit in such form as may
be prescribed by the Governor in Council verifying the particulars
and value of the estate of a deceased person;

'applicable Schedule' in the case of persons dying before 27 February
1931 means the First Schedule, and in the case of persons dying
thereafter but before 1 July 1936 means the Second Schedule, and
in the case of persons dying on or after 1 July 1936 but before 1
April 1941 means the Third Schedule and in the case of persons
dying on or after 1 April 1941 but before 1 April 1948, means the
Fourth Schedule, and in the case





of person dying on or after 1 April 1948 but before 1 February 1959
means the Fifth Schedule, and in the case of persons dying on or
after 1 February 1959 but before 1 January 1963 means the Rixth
Schedule, and in the case of persons dying on or after 1 January
1963 but before 1 April 1967 means the Seventh Schedule, and in
the case of persons dying on or after 1 April 1967 but before 1 April
1970 means the Eighth Schedule, and in the case of persons dying
on or after 1 April 1970 but before 1 April 1972 means the Ninth
Schedule, and in the case of persons dying on or after 1 April 1972
but before 1 April 1974 means the Tenth Schedule. and in the case
of persons dying on or after 1 April 1974 but before the
commencement of the Estate Duty (Amendment) Ordinance 1976
means the Eleventh Schedule, and in the case of persons dying on
or after the commencement of the Estate Duty (Amendment)
Ordinance 1976 but before the commencement of the Estate Duty
(Amendment) Ordinance 1977 means the Twelfth Schedule, and in
the case of persons dying on or after the commencement of the
Estate Duty (Amendment) Ordinance 1977 but before the
commencement of the Estate Duty (Amendment) Ordinance 1980
means the Thirteenth Schedule, and in the case of persons dying
on or after the commencement of the Estate Duty (Amendment)
Ordinance 1980 but before the commencement of the Estate Duty
(Amendment) Ordinance 1981 means the Fourteenth Schedule, and
in the case of persons dying on or after the commencement of the
Estate duty (Amendment) Ordinance 1981 but before the
commencement of the Estate Duty (Amendment) Ordinance 1982
means the Fifteenth Schedule, and in the case of persons dying on
or after the commencement of the Estate Duty (Amendment)
Ordinance

Its

1982, means the Sixteenth Schedule-, (Amended, 47 of 1962, s. 2; 24
of 1967, s. 2; 37 of 1970, s. 2; 27 of 1972, s. 2; 24 of 1974, s. 2: 31 of
1976, s. 2; 31 of 1977, s. 2; 33 of 1980, s. 2; 29 of 1981, s. 2 and 28 qf
1982, s. 2)

,,assets' includes goodwill;

,,associated operations' means any 2 or more operations of any kind
being

(a)operations which affect the same property, or one of which
effects some property and the other or others of which affect
property which represents, whether directly or indirectly, that
property or income arising from that property, or any property
representing accumulations of any such income; or

(b)any 2 operations of which one is effected with reference to
the other, or with a view to enabling it to be effected or to
facilitating its being effected, and any third operation having
a like relation to either of those two, and any fourth operation
having a like relation to any of those three, and so on,





whether those operations are effected by the same person or by
different persons, whether they are connected otherwise than as
aforesaid or not, and whether they are contemporaneous or any of
them precedes or follows any other;

'average rate' means, in relation to a company, a rate per cent per
annum, the percentage being ascertained by

(a)computing the aggregate amount of the net profits of the
company for the relevant accounting years, a deduction being
made, where the company sustained a loss in any of those
years, of the amount of the loss;

(b) dividing that amount by the number of those years; and

(c)comparing the result with the principal value of the assets of
the company passing on the death of the deceased by virtue
of section 35 after making the allowances to be made under
section 39;

'Commissioner' means such person as the Governor may appoint as
Commissioner for the purpose of this Ordinance; (Amended, 21 of
1972, s. 2)

'company' includes any body corporate, wheresoever incorporated;

'debenture' means, in relation to a company, any obligation of the
company in respect of any loan capital issued by the company
otherwise than as consideration for a loan made to it in the ordinary
course of banking business, or in respect of any debt incurred by
the company

(a)for any money borrowed by the company, otherwise than by
way of temporary loan made in the ordinary course of a
banking business;

(b)for any transfer of capital assets made to the company by any
person, unless the obligation is one resulting from a dealing
with a person who transferred such assets to the company in,
and on terms consistent with, the ordinary course of a
business carried on by him;

(c)without consideration, or for consideration the value of which
to the company at the time when the debt was incurred was
substantially less than the value at that time of the debt,
including any premium thereon; or

(d)where the debt was of such a nature that it would in the
ordinary course of business and apart from some special
arrangement, have carried interest, if the debt did not carry
interest or carried interest at a rate which was either
unreasonably high or unreasonably low;

'disposition' includes any trust, covenant, agreement or arrangement,
whether made by a single operation or by associated operations,
and also, in relation to shares in or debentures of a company, the
extinguishment or any alteration of rights attaching thereto,
whether effected by a single operation or by associated operations;





'distributed assets' means. in relation to a company, assets of the
company to which section 35(3) applies which were disposed of or
distributed by the company as mentioned in that subsection, and
'value of the distribution' means, in relation to any distributed
assets, the value thereof or, if partial consideration, other than the
extinguishment, or an alteration, of rights attaching to shares in or
debentures of a company to which that section applies, was given
for the distribution in money or money's worth received by the
company for its own use and benefit, the value thereof less the
value of the consideration given;

'dividend' includes a bonus chargeable to tax under the Inland
Revenue Ordinance and also any bonus which would be so
chargeable if it had arisen in or been derived from the-Colony;

11
estate duty' means duty chargeable under this Ordinance;

'executor' means the executor or administrator of a deceased person
and includes, as regards any obligation under this Ordinance, any
person who takes possession of or intermeddles with the property
of a deceased person or any portion thereof,

'incumbrance' includes mortgage and terminable charge;

-interest in expectancy- includes an estate in remainder or reversion and
every future interest whether vested or contingent. but does not
include a reversion expectant upon the determination of a lease;

,,member' means, in relation to a company. a holder in his own right of
any share in or debenture of the company, and a person interested
in any share in or debenture of the company held, whether by
himself or another, otherwise than in the holder's own right;

,,officer' means, in relation to a company, any person who exercises the
functions of a director, manager, secretary or liquidator of the
company;

'payment' includes a transfer of property and a set-off or release of an
obligation, and references to the amount of a payment include, in
relation to property transferred or to an obligation set-off or
release, references to the value thereof,

'periodical payment means a payment by way of dividend or interest, a
payment by way of remuneration not being a single lump sum
payment, and any other payment being one of a series of payments,
whether inter-connected or not, whether of the same or of varying
amounts, and whether payable at regular intervals or otherwise;

'property' includes movable and immovable property and the proceeds
of sale thereof respectively and any money or investment for the
time being representing the proceeds of sale.





'property passing on the death' includes property passing either
immediately on the death or after any interval, and either certainly
or contingently, and either originally or by way of substitutive
limitation, and 'on the death- includes---ata period ascertainable
only by reference to the death';

'power' includes any right or power exercisable by virtue of the holding
of shares in or debentures of a company. and any right or power to
procure an issue of shares in or debentures of a company;

'settlement' means any non-testamentary disposition in writing,
whether made voluntarily or upon a good or valuable consideration
other than a bona fide pecuniary consideration, whereby any
definite and certain property is settled or agreed to be settled in
any manner for any purpose whatsoever.

(2) For the purposes of this Ordinance-

(a)a person shall be deemed competent to dispose of property if
he has such an estate or interest therein or such general power
as would, if he were dui juris, enable him to dispose of the
property; and 'general power- includes every power or
authority enabling the donee or other holder thereof to
appoint or dispose of property as he thinks fit, whether
exercisable by instrument inter vivos or by will, or both, but
exclusive of any power exercisable either in a fiduciary
capacity under a disposition not made by himself or as
mortgagee;

(b)a disposition taking effect out of the interest of the deceased
person shall be deemed to have been made by him. whether
the concurrence of any other person was or was not required;

(c)money which a person has a general power to charge on
property shall be deemed to be property of which he has
power to dispose;

(d)the creation by a person or with his consent of a debt or other
right enforceable against him personally or against property of
which he was or might become competent to dispose, or to
charge or burden for his own benefit. shall be deemed to have
been a disposition made by that person, and in relation thereto
the expression -property--- shall include the debt or right
created;

(e)the extinguishment at the expense of the deceased of a debt or
other right shall be deemed to have been a disposition made
by the deceased in favour of the person for whose benefit the
debt or right was extinguished, and in relation thereto the
expression 'property' shall include the benefit conferred by
the extinguishment of the debt or right.

(3) A person shall be deemed to have made a transfer of property
to a company if the property came to be included in the





resources of the company by the effect of a disposition made by him or
with his consent or of any associated operations of which such a
disposition formed one.

(4) A person shall be deemed to have received or had any payment,
income, profit, enjoyment, assets, or interest, the receipt or having
whereof by him is relevant for the purposes of this Ordinance, if any of
the following conditions have been satisfied in relation thereto, that is
to say

(a)if the relevant payment or other matter has been applied in any
manner for the benefit of that person, or has been dealt with
by that or any other person in any manner calculated to cause
it to inure for the benefit of that person at any time, whether in
the form of income or not or if any property which was or
would be available for the purpose by reason of the effect or
successive effects of any one or more of associated
operations relating to the relevant payment or other matter has
been so applied or dealt with;

(b)if any advantages received or to be received at any time by
that person have been provided out of that payment or other
matter, or out of any such property as aforesaid;

(c)if that person became able in any manner to control the
application of the relevant payment or other matter, or of any
such property as aforesaid, othewise than in a fiduciary
capacity;

(d)if the relevant payment or other matter, or any such property
as aforesaid. has been applied in any manner so as to increase
the value to that person of any property in which he was
beneficially interested; or

(e)as respects such profits as are mentioned in section 36, if the
receipt by. or accrual to, the company of those profits
operated in any manner so as to increase the value to that
person of any property in which that person was beneficially
interested, so however that the amount of the income or
profits which that person is to be treated as having received
by virtue of this paragraph shall be limited to the amount of
the increase in value of the property in question,

and references in this Ordinance to the deceased's receiving or having,
or being or becoming entitled to receive or have, any such payment or
other matter as aforesaid shall be construed accordingly.

(5) References in this Ordinance-

(a)to a disposition's being made by any person, to a power's
being exercised or exercisable by any person, or to any other
act's being done by any person, include references to its
being 9 made, or being exercised or exercisable, or being
done, by him and another jointly or by another at his direction
or by a company of which he had control, or powers
equivalent to control, within the meaning of sec





tion 44(3), whether with or without the consent of any
other person having similar powers; references importing
an omission on the part of any person in relation to any
such matter as aforesaid shall be construed in like manner;
and references in relation to any such matter, as aforesaid
to its being made, or being exercised or exercisable, or
being done or omitted, with the consent of any person
include references to its being made, or being exercised or
exercisable, being done or omitted, at his request or with or
subject to his acquiescence;
(b)to a person having any power or control or doing any act
in a fiduciary capacity shall be construed as references to
his having that power or control or doing that act in a
fiduciary capacity imposed on him otherwise than by a
disposition made by him and in such a capacity only;
(c)to an interest ceasing or being limited to cease on a death
shall be construed as including references to its being
subject to a limitation, in whatsoever form, having the
effect of providing in the alternative for its cesser on the
death or on the occurrence of some event, or the expiration
of some period, before the death;
(d)to a transfer of property, (except in the definition of
'payment' in subsection (1)) shall include a reference to a
payment of money, and the expressions 'disposition' and
,,value' respectively, in relation to money, shall include
payment and amount.
(Replaced, 1 of 1959, s. 2)

3A. (1) Where under this Ordinance any power is conferred
or any duty is imposed on the Commissioner and it is not provided
that the power or duty shall be exercised or performed by the
Commissioner personally, such power may be exercised or such duty
may be performed by a deputy commissioner of estate duty or an
assistant commissioner of estate duty.
(2) Except where this Ordinance provides that a power or duty
shall be exercised or performed by the Commissioner personally, the
Commissioner may, subject to such limitations as he may think fit,
authorize in writing any public officer to exercise any power or
perform any duty conferred or imposed upon him by this Ordinance.
(Added, 21 of 1972, s. 3)

4. (1) The Chief Justice may, by a commission signed by
him, appoint the Commissioner or any deputy commissioner to be
a commissioner to administer oaths and take declarations and
affirmations for the purposes of this Ordinance, and may revoke any
such appointment.
(2) Every person so appointed shall be styled a commissioner
for oaths and shall have all the powers and discharge all the duties
which now belong to the office of a commissioner to administer oaths.
(Added, 32 of 1934, s. 2)





5. In the case of every deceased person there shall, save as
hereinafter expressly provided, be levied and paid upon the principal
value, ascertained as hereinafter provided, of all property passing on
the death of such person, a duty called estate duty at the graduated
rates mentioned in the applicable Schedule:

Provided that, where the principal value of an estate comprises a
fraction of 5100, such fraction shall, for the purpose of determining the
amount of estate duty payable, be reckoned as $100:

Provided also that where an interest in expectancy in any property
has, before 27 February 1931, been bona fide sold or mortgaged
for full consideration in money or money's worth, then no higher duty
on that property shall be payable by the purchaser or mortgagee when
the interest falls into possession than is in accordance with the rates
mentioned in the First Schedule, and in the case of a mortgage any
higher duty payable by the mortgagor shall rank as a charge
subsequent to that of the mortgagee.

(Amended, 47 of
1962, s. 3)

6. (1) Property passing on the death of the deceased shall be
deemed to include the property following

(a)property of which the deceased was at the time of his death
competent to dispose;

(b)property in which the deceased or any other person had an
interest ceasing on the death of the deceased, to the extent to
which a benefit accrues or arises by the cesser of such interest,
and such property shall be deemed to pass on the death of the
deceased notwithstanding that that estate or interest has been
surrendered, assured, divested or otherwise disposed of,
whether for value or not, to or for the benefit of any person
entitled to an estate or interest in remainder or reversion in
such property, unless that surrender, assurance, divesting or
disposition was bona fide made or effected 3 years
before the death, or if it was made or effected for such
purposes as are recognized by the Commissioner as public or
charitable, one year before the death, and bona fide
possession and enjoyment of the property was assumed
thereunder immediately upon the surrender, assurance,
divesting or disposition, and thenceforward retained to the
entire exclusion of the person who had the estate or interest
limited to cease as aforesaid, and of any benefit to him by
contract or otherwise:

Provided that where property affected by such a
surrender, assurance, divesting or disposition is deemed to be
property passing on the death of the deceased by reason only
that the property was not, as from the date of the surrender,
assurance, divesting or disposition, retained to the entire
exclusion of the deceased or a person who had an estate or
interest limited to cease on the death of the deceased, and of
any benefit to him by contract or other





wise, the property shall not be deemed to pass on the death of
the deceased if subsequently, by means of the surrender of
the benefit reserved or otherwise, it is enjoyed to the entire
exclusion of the deceased or such other person as aforesaid,
and of any benefit to him by contract or otherwise, for a
period of 3 years immediately preceding the death, or in the
case of such purposes as are recognized by the Commissioner
as public or charitable, one year immediately preceding the
death:

Provided also that this paragraph shall not apply to any
property the interest in which of the deceased or other person
was only an interest as holder of an office or as recipient of
the benefits of a charity or as a corporation sole; (Amended, 1
of 1959, s. 3)

(e) property taken as a donatio mortis causa made by the
deceased or taken under a disposition made by him,
purporting to operate as an immediate gift inter vivos,
whether by way of transfer, delivery, declaration of trust,
or otherwise, which shall not have been bona fide made 3
years before the death or in the case of a gift inter vivos
made or effected for such purposes as may be recognized
by the Commissioner as public or charitable, one year
before the death, or taken under any gift, whenever made,
of which property bona fide possession and enjoyment shall
not have been assumed by the donee immediately upon the
gift and thenceforward retained to the entire exclusion of
the donor or of any benefit to him by contract or otherwise:

Provided that this paragraph shall not apply to gifts
inter vivos which are made in consideration of marriage,
or which are proved to the satisfaction of the Commis-
sioner to have been part of the normal expenditure of the
deceased, and to have been reasonable having regard to the
amount of his income or to the circumstances, or which in
the case of any donee do not exceed in the he aggregate
in value or amount: (Amended, 28 of 1979, s. 2)

Provided also that where property taken under a
disposition purporting to operate as an immediate gift
inter vivos is deemed to be property passing on the death
of the deceased by reason only that the property was not,
as from the date of the disposition, retained to the entire
exclusion of the deceased or a person who had an estate or
interest limited to cease on the death of the deceased, and
of any benefit to him by contract or otherwise, the prop-
erty shall not be deemed to pass on the death of the
deceased if subsequently, by means of the surrender of the
benefit reserved or otherwise, it is enjoyed to the entire
exclusion of the deceased or such other person as afore-
said, and of any benefit to him by contract or otherwise,
for a period of 3 years immediately preceding the death or
in the case of such purposes as are recognized by the Com-





missioner as public or charitable, one year before the death:

(Amended, 29 of 1981, s. 3)

Provided also that money or money's worth paid or
applied by the deceased in or towards satisfaction or
discharge of a debt or incumbrance in the case of which
section 13(2) would have had effect on his death if the debt or
incumbrance had not been satisfied or discharged, or in
reduction of a debt or incumbrance in the case of which that
subsection has effect on his death, shall, unless so paid or
applied 3 years before the death, be treated as property
deemed to be included in the property passing on the death
and estate duty shall, notwithstanding anything in section
10(a), be payable in respect thereof accordingly; (Amended, 1 of
1959, s. 3)

(d)property to which the deceased has been absolutely entitled,
and which he has caused to be transferred to or vested in
himself and any other person jointly, whether by disposition
or otherwise (including also any purchase or investment
effected by the deceased either by himself alone, or in
concert, or by arrangement with any other person), so that the
beneficial interest therein or in some part thereof passes or
accrues by survivorship on his death to such other person;

(e)property passing under any past or future settlement made by
the deceased by deed or any other instrument not taking
effect as a will, whereby an interest in such property or the
proceeds of sale thereof, for life or any other period
determinable by reference to death is reserved, either
expressly or by implication, to the settlor, or whereby the
settlor may have reserved to himself the right by the exercise
of any power to restore to himself, or to reclaim the absolute
interest in such property or the proceeds of sale thereof,

any annuity or other interest purchased or provided by the
deceased either by himself alone or in concert or by
arrangement with any other person, to the extent of the
beneficial interest accruing or arising by survivorship or
otherwise on the death of the deceased, except that the
foregoing provisions of this paragraph shall have effect in
relation to an annuity or other interest purchased or provided
wholly or in part by any person who was at any time entitled
to, or amongst whose resources there was at any time
included,any property derived from the deceased, as if that
annuity or other interest had been provided by the deceased,
or, if it is proved to the satisfaction of the Commissioner that
the application of all the property derived from the deceased
would have been insufficient to provide the whole of that
annuity or other interest, as if a similar annuity or interest of
an amount reduced to an extent proportionate to the
insufficiency proved had been provided by the deceased:





Provided that for the purpose of determining whether
there would have been any such insufficiency as aforesaid,
and the extent thereof, there shall be excluded from the
property derived from the deceased any part thereof as to
which it is proved to the satisfaction of the Commissioner that
the disposition of which it, or the property which it
represented, was the subject matter was not made with
reference to, or with a view to enabling or facilitating, the
purchase or provision of the annuity or other interest, or the
recoupment in any manner of the cost thereof.

In this paragraph-

'property derived from the deceased' shall include any
property which was the subject matter of a disposition,
made by the deceased, either by himself alone or in
concert or by arrangement with any other person,
notwithstanding that the disposition was made for full
consideration in money or money's worth paid to the
deceased for his own use or benefit, or which
represented any of the subject matter of such
disposition, whether directly or indirectly, and whether
by virtue of one or more intermediate dispositions, and
whether any such intermediate disposition was or was
not for full or partial consideration:

Provided that where the first-mentioned disposition
was for full consideration in money or money's worth
paid to the deceased for his own use or benefit and it is
proved to the satisfaction of the Commissioner that the
disposition was not part of associated operations which
included a disposition by the deceased, either by himself
alone or in concert or by arrangement with any other
person, otherwise than for full consideration in money or
money's worth paid to the deceased for his own use or
benefit; or a disposition by any other person operating
to reduce the value of the property of the deceased, then,
in considering whether estate duty should be charged by
virtue of this paragraph, paragraph (c) and section 13(2),
the said first-mentioned disposition shall be left out of
the account as if this sub-paragragh did not apply in
relation to it; and (Amended, L.N. 100168)

'subject matter' includes, in relation to any disposition, any
annual or periodical payment made or payable under or
by virtue of the disposition; (Amended, 1 of 1959,s.3)

(g)debts and sums of money due and owing from persons in the
Colony to any deceased person at the time of his death on
obligation or other specialty, to the same extent as if they were
owing to the deceased upon simple contract, without regard
to the place where the obligation or





specialty shall be at the time of the death of the deceased;
and (Amended, 1 of 1959, s. 3)

(h)an interest limited to cease on the death which has been
disposed of or has determined, whether wholly or partly,
whether by surrender, assurance, divesting. forfeiture or in any
other manner, except by the expiration of a fixed period at the
expiration of which the interest was limited to cease, and
whether for value or not, after becoming an interest in
possession and the disposition or determination, or any of
them if there are more than one, is not excepted by the proviso
hereto, then

(i) if, had there been no disposition or determination as
aforesaid of that interest and no disposition of any interest
expectant upon or subject to that interest, the property in
which the interest subsisted would have passed on the death
under section 5, that property shall be deemed by virtue of
this paragraph to be included as to the whole thereof in the
property passing on the death; or

(ii) if, had there been no disposition or determination as
aforesaid of that interest and no disposition of any interest
expectant upon or subject to that interest, the property in
which the interest subsisted would have been deemed by
virtue of paragraph (b) to be included to a particular extent in
the property passing on the death. then. the property in which
the interest subsisted shall be deemed by virtue of this
paragraph to be included to that extent in the property
passing on the death:

Provided that where a disposition or determination of an
interest limited to cease on the death was bona fide effected or
suffered 3 years before the death, or, if it was effected or
suffered for such purposes as are recognized by the
Commissioner as public or charitable, one year before the
death, the disposition or determination shall be excepted by
this proviso

(a)if bona fide possession and enjoyment of the property in
which the interest subsisted was assumed immediately
thereafter by the person becoming entitled by virtue of or
upon the disposition or determination and thenceforward
retained to the entire exclusion of the person who
immediately before the disposition or determination had
the interest and of any benefit to him by contract or
otherwise, or

(b)in the case of a partial determination, if the conditions
specified in sub-paragraph (a) were not satisfied by
reason only of the retention or enjoyment by the
deceased of possession of some part of the property, or
of some benefit, by virtue of the provisions of the
instrument under which he had the interest. (Added, 1 of
1959, s. 3)





(2) In the application of subsection (1)(h) to a case in which an
incumbrance on the property in which the interest in question subsisted
has been created by associated operations which included a disposition
of that interest, references to that property shall be construed as
references to that property free from the incumbrance except in a case in
which the incumbrance was created for considera~ tion in money or
money's worth which was applied for purposes calculated to maintain or
increase the value of that property, and, in that case, shall be construed
as references to that property subject to the incumbrance to the extent
to which the consideration was so applied. (Added, 1 of 1959, s. 3)

(3) Subsection (1)(h) shall have effect only in relation to a person
dying after the commencement of the Estate Duty (Amendment)
Ordinance 1959, and paragraph (b) of that subsection shall not have
effect in relation to such a person. (Added, 1 of 1959, s. 3)

(4) Property passing on the death of the deceased shall not be
deemed to include property held by the deceased as trustee for another
person, under a disposition not made by the deceased or under a
disposition made by the deceased more than 3 years before the death, or
in the case of a disposition made for such purposes as are recognized
by the Commissioner as public or charitable, one year before the death
where possession and enjoyment of the property was bona fide
assumed by the beneficiary immediately upon the creation of the trust
and thenceforward retained to the entire exclusion of the deceased or of
any benefit to him by contract or otherwise:

Provided that where property taken under such a disposition as
aforesaid is deemed to be property passing on the death of the deceased
by reason only that the property was not, as from the date of the
disposition, retained to the entire exclusion of the deceased or a person
who had an estate or inerest limited to cease on the death of the
deceased, and of any benefit to him by contract or otherwise. the
property shall not be deemed to pass on the death of the deceased if
subsequently, by means of the surrender of the benefit reserved or
otherwise, it is enjoyed to the entire exclusion of the deceased or such
other person as aforesaid and of any benefit to him by contract or
otherwise, for a period of 3 years immediately preceding the death or in
the case of a disposition made for such purposes as are recognized by
the Commissioner as public or charitable, one year immediately
preceding the death. (Amended, 1 of 1959, s. 3)

(5) Where property is settled by a person on himself for life, and
after his death on any other person with an ultimate reversion of an
absolute interest or absolute power of disposition to the settlor, the
property shall not be deemed for the purpose of this Ordinance to pass
to the settlor on the death of any such other person after the
commencement of this Ordinance, by reason only that the settlor, being
then in possession of the property as tenant for life, becomes, in
consequence of such death, entitled to dispose of the whole property.





(6)(a) Where by a disposition of any property an interest is
conferred on any person other than the disponer for the life of
such person or determinable on his death, and such person
enters into possession of the interest and thenceforward
retains possession thereof to the entire exclusion of the
disponer or of any benefit to him by contract or otherwise, and
the only benefit which the disponer retains in the said property
is subject to such life or determinable interest, and no other
interest is created by the said disposition, then, on the death
of such person the property shall not be deemed for the
purposes of this Ordinance to pass by reason only of its
reverter to the disponer in his lifetime.

(b)Where by a disposition of any property any such interest as
above in this subsection mentioned is conferred on 2 or more
persons, either severally or jointly, or in succession, this
subsection shall apply in like manner as where the interest is
conferred on one person.

(c)Provided that paragraphs (a) and (b) shall not apply where
such person or persons taking the said life or determinable
interest had at any time prior to the disposition been himself or
themselves competent to dispose of the said property.

(7) Notwithstanding paragraphs (b), (c) and (it) of subsec-
tion (1) and notwithstanding subsection (4), property passing on the
death of the deceased shall not be deemed to include property the
subject of any surrender, assurance, divesting, disposition, forfei-
ture, disposal, donatio mortis causa, gift inter vivos or determination
of an interest made, effected or suffered to or for the benefit in~
Colony of any charitable institution or trust of a public character, or
to the Government, or the Urban for charitable purposes.

2
(Added. 29 of 1970,s.2. Amended,74 of 1981,s.2)

7. (1) For the purposes of section 6(1)(c), any disposition made by
the deceased in favour of a relative of his shall be treated as a gift
unless

(a)the disposition was made on the part of the deceased for full
consideration in money or money's worth paid to him for his
own use or benefit; or

(b)the deceased was concerned in a fiduciary capacity imposed
on him otherwise than by a disposition made by him and in
such a capacity only:

Provided that where the disposition was made on the part of the
deceased for partial consideration in money or money's worth paid to
him for his own use or benefit, the value of the consideration shall be
allowed as a deduction from the value of the property for the purpose of
estate duty.

(2) Where the deceased made a disposition of property in favour
of a relative of his. the creation or disposition in favour of the





deceased of an annuity or other interest limited to cease on the death of
the deceased or of any other person shall not be treated for the
purposes of this section or of section 13(1) as consideration for the
disposition made by the deceased, except as provided in section 8.

(3) Where there have been associated operations effected with
reference to the receiving by the deceased of any payment in respect of
such an annuity or other interest as in mentioned in subsection (2), or
effected with a view to enabling him to receive or to facilitating the
receipt by him of any such payment, this section and section 45 shall
have effect in relation to each of those associated operations as they
have effect in relation to the creation or disposition in favour of the
deceased of such an annuity or other interest.

(4) In this section, section 8 and section 45-

'annuity' includes any series of payments, whether inter-connected or
not, whether of the same or of varying amounts, and whether
payable at regular intervals or otherwise, and payments of
dividends or interest on shares in or debentures of a company shall
be treated for the purposes of the said provisions as a series of
payments constituting an annuity limited to cease on a death if the
payments are liable to cease on the death, or the amounts thereof
are liable to be reduced on the death, by reason directly or
indirectly of the extinguishment or any alteration of rights attaching
to, or,of the issue of, any shares in or debentures of a company.

'relative' means

(a) wife or husband;

(b) father and mother;

(c) child, uncle and aunt;

(d)any issue of a person falling within either (a), (b) or (c) above
and the other party to a marriage with any such person or
issue;

(e)concubine recognized as such by the law appropriate to the
marriage; and

references to 'child' and 'issue' include references to any
illegitimate child and to any adopted child.

(Added, 1 of 1959, s. 4)

7A. Where, after the commencement of the Estate Duty

(Amendment) Ordinance 1982, 2 or more persons die in circumcise
stances rendering it uncertain that any one of the survived e the other or
others, the property chargeable with estate duty in respect of each death
shall be ascertained as if they had died at the same time and all relevant
property had devolved accordingly.

(Replaced, 28 of 1982, s. 3)

8. (1) Subject to the provisions of this section, the relief specified
herein shall be granted where, on the death of a person who





has made a disposition of property in favour of a relative of his or a
company, any estate duty becomes, or would but for this section
become payable by virtue of section 7(2),
(2) The sum on which estate duty would be payable apart
from this section on the death in respect of the property which was
the subject matter of the disposition or in respect of the property
liable to a debt or incumbrance created by the deceased which was
the subject matter of the disposition, as the case may be, shall first
be computed and, subject to the limitations provided for by subsec-
tion (4), there shall then be allowed as a deduction from that sum-
(a)the amount, if any, by which the aggregate of the payments
which have been made on account of the annuity or other
interest for the period from the date when the annuity or
other interest began to accrue in favour of the deceased
until his death, exceeds the aggregate of the income derived
from the deceased by virtue of the disposition for the
period from the date of the disposition until his death; and
(b)simple interest on so much, if any, of the amount aforesaid,
and for such period, as, in the opinion of the Commis-
sioner, is in all the circumstances just, at the rate of 4 per
cent per annum.
(3) In subsection (2), the expression ---theaggregate of the
income derived from the deceased by virtue of the disposition-
means-
(a)in relation to so much of the property which was the
subject matter of the disposition as did not consist of a
debt or incumbrance created by the deceased, such amount
as, in the opinion of the Commissioner, is in all the
circumstances equal to a reasonable return from the prop-
erty; and
(b)in relation to so much of the property which was the
subject matter of the disposition as did consist of a debt
or incumbrance created by the deceased, the aggregate
amount of the interest paid or payable by the deceased in
respect of that debt or incumbrance.
(4) The amount to be allowed as a deduction under subsec-
tion (2) shall, in the circumstances specified in the provisions of
subsections (5), (6) and (7) be limited to the extent specified in
those subsections respectively.
(5) If the annuity payments specified in subsection (2)(a) had
formed the consideration for a debt created by the deceased equal to
the total amount of those payments, and if section 13(1) were
applied to that debt. the full amount of that debt would not having
regard to the operation of section 13(2) have been allowable under
subsection (1) of that section, the said annuity payments shall, for
the purpose of ascertaining the amount to be allowed as a deduc-
tion under this section, be reduced so as not to exceed the amount, if
any, which would have been allowable in the circumstances afore-
said under subsection (1) of that section:





Provided that in applying the said subsection (2) for the
purposes of this subsection, property which is the subject matter of
the disposition shall not be treated as property derived from the
deceased.

(6) Where under section 7 a deduction for partial considera-
tion would have been allowable in respect of the annuity or other
interest if subsection (2) of that section had not applied to the
disposition and if any other consideration for the disposition had
not been given, the amount to be allowed as a deduction under this
section shall not exceed the amount of that deduction.

(7) Where the amount to be allowed as a deduction under this
section is allowed as a deduction from the value of the property
liable to a debt or incumbrance created by the deceased, it shall
not exceed the amount, if any, which would be allowed under
section 13(1) if sections 7 and 45 had not been passed.
(Added, 1 of 1959, s. 4)

9. (1) Where any shares in or debentures of a company are
comprised in a gift inter vivos and the donee is, as the holder of those
shares or debentures, issued with shares in or debentures of the same
or any other company, or granted any right to acquire any such
shares or debentures, then, unless the issue or grant is made by way
of exchange for the first mentioned shares or debentures, the shares
or debentures so issued, or the right granted, shall be treated for the
purposes of this Ordinance as having been comprised in the gift in
addition to any other property so comprised.

(2) In subsection (1), the reference to an issue being made or
right being granted to the donee as the holder of shares or
debentures shall be taken to include any case in which an issue or
grant is made to him as having been the holder of those shares or
debentures, or is made to him in pursuance of an offer or invitation
made to him as being or having been the holder of those shares or
debentures, or of an offer or invitation in connexion with which any
preference is given to him as being or having been the holder thereof.

(3) Where subsection (1) applies to determine, for purposes of
estate duty, the property comprised in a gift inter vivos made by the
deceased, the value of any consideration in money or money's worth
given by the donee for the issue or grant referred to in the said
subsection (1) shall be allowed as a deduction in valuing the property
comprised in the gift as property deemed to pass on the death by
virtue of the gift; but if any part, not being a sum of money, of the
said consideration consists of property comprised in the same or
another gift from the donor and deemed for purposes of estate duty
to pass on his death, no deduction shall be made in respect of it
under this subsection.

(4) For the purposes of subsection (3), there shall be left out of
account so much, if any, of the consideration for any shares in or
debentures of a company or for the grant of any right to be issued
with any such shares or debentures, as consists in the capitalization





of reserves of that company, or in the retention by that company, by
way of set-off or otherwise, of any property distributable by it, or is
otherwise provided directly or indirectly out of the assets or at the
expense of that or any associated company; and for this purpose 2
companies shall be deemed to be associated if one has a controlling
interest in the other, or if some person has a controlling interest in both.

(5) In the case of a donee who dies before the donor, subsections
(1) to (4) inclusive shall apply as if he had not died, and as if the acts of
his personal representative were his acts, and property taken by any
person under his testamentary dispositions or on his intestacy, or
partial intestacy, were taken under a gift made by him at the time of his
death.

(6) For purposes of aggregation, any property which is by virtue of
subsections (1) to (5) inclusive to be treated as comprised in a gift inter
vivos made by the deceased shall be deemed to be property in which
the deceased had an interest, except in so far as it is derived from
property originally comprised in the gift in which the deceased never
had an interest.

(7) For the purposes of estate duty, any question whether,
possession and enjoyment of any property comprised in a gift inter
vivos was at a particular time assumed or had by any person to the
exclusion of any other person shall, so far as the question depends on
the identity of the property, be determined by reference to the property
which would for the time being be treated, in relation to the death if it
occurred at that time, as property comprised in the gift.

(8) For the purposes of this section, the principal value of any
property at a time before the death of the deceased shall be ascertained
as it would be for the purposes of estate duty chargeable on his death if
he had died immediately before that time.

(Added, 1 of 1959, s. 4)

10. Estate duty shall not be payable in respect of-

(a)property passing on the death of the deceased by reason
only of a bona fide purchase from the person under whose
disposition the property passes nor in respect of the
determination of any annuity for lives where such purchase
was made or such annuity granted for full consideration in
money or money's worth paid to the vendor or grantor for his
own use or benefit. Where any such purchase was made, or
annuity granted, for partial consideration in money or
money's worth paid to the vendor or grantor for his own use
or benefit, the value of the consideration shall be allowed as a
deduction from the value of the property for the purpose of
estate duty; (Amended, L.N. 63170)

(b) property situate outside the Colony







(c)any share or other interest of a deceased member of a
company registered in a local or- branch register kept out of
the Colony under the Companies Ordinance; (Amended, 29 of
1970, s. 3)

(d)property situate in the New Territories, other than New
Kowloon, where the principal value of the estate does not
exceed $2,000 or the minimum principal value for which a rate
for the payment of estate duty has been provided under the
applicable Schedule, whichever is the greater,and property situate elsewhere in the Colony, where the
the princle value of the
estate does not exceed the minimum
principal value for which a rate for the payment of estate
duty has been provided under the applicable Schedule;
(Replaced, 47 of 1962, s. 4)

(e)any temple for the worship of ancestors, situate in the New
Territories, other than New Kowloon, registered in the name of
the manager of a clan, family or t'ong property similarly registered as is used for
maintenance of such temple; (Added, 38 of 1935, s. 2)

(f)any other temple in the New Territories, other than New
Kowloon, certified by the Secretary for District Administration
to be a Chinese temple as defined in section 2 of the Chinese
Temples Ordinance, and so much of any property as is used
for the maintenance of such temple; (Added, 38 of 1935, s. 2.
Amended, L.N. 94174, L.N. 370181 and L. N. 14183)

(g)property devised or bequeathed by the deceased or other-
wise passing death of the deceased to or for the
benefit in any charitable institution or trust
of a public character, or to the Government, or the Urban
Council for charitable purposes. (Added, 29 of 1970,
s. 3. Amended, 74 of 1981, s. 3)

10A. (1) Estate duty shall not be payable in respect of property

(a)which was, immediately before the death of the deceased-

(i) a residence owned by him and occupied solely by him
exclusively for residential purposes; and

(ii) the matrimonial home of the deceased and his spouse;
and

(b)which is devised or bequeathed by the deceased, of otherwise
passes on his death, to or for the benefit of his spouse.

(2) For the purposes of subsections (1) and (3)-

(a)property shall be deemed to be a residence and deemed to be
capable of being a matrimonial home if the property is the
exclusive right to enjoy the residence together with the





right to an undivided share in land on which the residence is
situated;

(b)a residence shall be deemed to be owned by the deceased if the
property is owned by him or by him and his spouse,

(c)a residence shall be deemed to be occupied solely by the
deceased if it is occupied solely by him or by him and his
Spouse and family

(3) Where more than one residence would, under subsection (1)
and but for this subsection, be exempt from estate duty, only one
residence shall be so exempt and the executor may, by notice in writing
to the Commissioner, elect which residence shall be exempt; in default of
which, the Commissioner shall make the election.

(4) For the purpose of determining the rate of estate duty to be paid
on property passing on death in respect of which estate duty is payable,
the property of the deceased exempt from estate duty under this section
and the property in respect of which estate duty is payable shall be
aggregated and, subject to section 11, estate duty shall be paid on the
property in respect of which estate duty is payable as if the value of the
property of the deceased exempt from estate duty under this section
formed part of the principal value of the estate.

(A dded, 28 of 1982, s. 4)

11. (1) For determining the rate of estate duty to be paid on any
property passing on the death of the deceased, all property so passing
in respect of which estate duty is payable shall be aggregated so as to
form one estate, and the duty shall be paid at the proper graduated rate
on the principal value thereof..

Provided that any property so passing, in which the deceased
never had an interest, shall not be aggregated with any other property
but shall be an estate by itself, and the duty shall be paid at the proper
graduated rate on the principal value thereof. (Amended, 1 of 1959, s. 5)

(2) For the purposes of this section, the deceased shall be deemed
to have had an interest in any property included, or deemed to be
included, by virtue of

(a) section 6(1)(f); or

(b) section 35,

in the property passing on his death. (Added, 1 of 1959, s. 5)

(3) The proviso to subsection (1) shall not have effect in relation
to property consisting of a debt, or right, or benefit, passing on the
death of the deceased, that is treated as property by virtue of section
3(2)(d) or (e). (Added, 1 qf 1959, s. 5)

(4) Where the property which passes on a death, but in which the
deceased never had an interest. includes any policies of assurance on
his life. or moneys received under such a policy, or interests in





such a policy or moneys, then the rate of estate duty to be paid on any
such policy, money or interest so included (hereinafter referred to as---
alife insurance') shall be determined as follows

(a)in respect of the value of any life insurance or interest in a life
insurance to which immediately after the death any one person
is absolutely and indefeasibly entitled for his own benefit
otherwise than by virtue of a purchase for consideration in
money or money's worth, whether of that life insurance or
interest or of the policy or otherwise, the rate shall be that
appropriate to the value or aggregate value of that life
insurance or interest and of any other life insurance or interest
in a life insurance to which he is so entitled;

(b)subject to paragraph (a) the rate shall be that appropriate to
the aggregate value of all the life insurance or, if there is only
one, to the value of that life insurance:

Provided that for the purposes of this subsection

(i)where any life insurance or interest in a life insurance is
immediately after the death subject to a mortgage or charge,
the mortgage or charge shall be disregarded and the life
insurance or interest shall be valued accordingly; and

(ii)in relation to life insurances and interests therein which then
form part of the unadministered estate of a deceased person
this subsection shall have effect as if that person had been
then living and entitled to those life insurances and interests.

(5) For the purposes of subsection (4)(a), the value of any interest
in a policy of assurance or moneys received under such a policy shall be
arrived at by apportioning the total value of the policy or moneys
according to the respective values of the interest in question and of the
interest a person would have if, except for the interest in question, he
were absolutely and indefeasibly entitled to the policy or moneys.
(Added, 1 of 1959, s. 5)

12. (1) Estate duty shall be payable as hereinafter mentioned.

(2) The executor of the deceased shall pay the estate duty in
respect of all property, of which the deceased was competent to dispose
at the date of his death, on delivering the affidavit for the Commissioner,
and may pay in like manner the estate duty in respect of any other
property passing on such death, which by virtue of any testamentary
disposition of the deceased is under the control of the executor or, in
the case of property not under his control, if the persons accountable
for the estate duty in respect thereof request him to make such payment.
(Amended, 47 of 1962, s. 5)

(3) Where the executor does not know the amount or value of any
property which has passed on the death, he may state in the affidavit for
the Commissioner that such property exists, but that he does not know
the amount or value thereof and that he undertakes





as soon as the amount and value are ascertained to bring in an account
thereof and to pay both the estate duty for which he is or may be liable
and any further estate duty payable by reason thereof for which he is or
may be liable in respect of the other property mentioned in the affidavit.

(4) Estate duty so far as not paid by the executor shall be paid on
an account setting forth the particulars of the property and delivered to
the Commissioner within 6 months after the death, by the person
accountable for the estate duty or within such further time as the
Commissioner may allow. Such duty shall be paid on delivering the
account. (Amended 47 of 1962, s.5)

(5) Every estate shall include all income accrued upon the property
included therein down to and outstanding at the date of the death of
the deceased.

(6) In addition to any estate duty payable, interest shall accrue and
be payable on such duty while it remains unpaid at the rate of 4 pet.
cent pet. annum from the date of the death of the deceased until the
expiration of 6 months from the death and at the rate of 8 per cent per
annum thereafter: (Replaced, 47of 1962,s. 5)

Provided that unless the Commissioner in any particular case with
the approval of the Governor in Council otherwise directs--

(a)in the case of any death occurring on or before 7 December
1941, no interest under this subsection shall be payable in
respect of the period from 8 December 1941 to 2 March 1946
and no part of the said period shall be taken into consideration
for the purpose of computation of the period of 6 months
referred to in this subsection, and

(b)in the case of any death occurring subsequent to 7 December
1941 and prior to 2 March 1946, the latter date shall be
substituted for the date of death for the purposes of this
subsection. (Added, 24 of 1950, Schedule. Amended, 47 of
1962, s. 5)

(7) The estate duty which is to be collected upon an affidavit for
the Commissioner or on an account. shall be due on the delivery thereof
or on the expiration of 6 months from the death, whichever first
happens.

(8) A rateable part of the estate duty on an estate in proportion to
the value of any leasehold property held solely by the deceased may at
the option of the person delivering the account be paid by 8 equal
yearly instalments, or 16 half-yearly instalments, and the first instalment
shall be due at the expiration of 6 months from the death, and the
interest on the unpaid portion of the duty shall be added to each
instalment and paid accordingly; but the duty for the time being unpaid.
with such interest to the date of payment, may be paid at any time, and
in case the property is sold shall be paid on completion of the sale, and
if not so paid shall be duty in arrear. (Added, 1 of 1959 s. 14. Amended,
47 of 1962, s. 5)

(Amended, 47 of 1962. s. 5)





13. (1) In determining the value of an estate for the purpose
of estate duty, allowance shall be made for reasonable funeral
expenses incurred in the G-el&my not exceeding-

(a)in the case of petsons eying before 1 January 1963, 51,000
or 21 per cent of the ascertained value of the estate, which-
ever is the smaller;

(b)in the case of persons dying on or after 1 January 1963 but
before 1 April 1972, $2,000 or 21- per cent of the ascertained
2
value of the estate, whichever is the smaller;

(c)in the case of persons dying on or after 1 April 1972 but
before the commencement of the Estate Duty (Amend-
ment) Ordinance 1977, 55,000 or 21 per cent of the ascer-
2
tained value of the estate, whichever is the smaller;

(d)in the case of persons dying on or after the commencement
of the Estate Duty (Amendment) Ordinance 1977, $10,000,

and for debts and incumbrances but an allowance shall not be
made-
(i)for debts incurred by the deceased and incumbrances
created by a disposition made by the deceased. unless such
debts or incumbrances were incurred or created hona.fide
for full consideration for money or money's worth wholly
for the deceased's own use and benefit and take effect out
of his interest; nor
(ii)for any debt in respect whereof there is a right to reimburse-
ment from any other estate or person unless such reimbur-
sement cannot be obtained, nor
(iii)more than once for the same debt or incumbrance changed
upon different portions of the estate,

and any debt or incumbrance for which an allowance is made shall
be deducted from the value of the property liable thereto. (Re-
placed, 31 of 1977, s. 3)

(2) Any allowance which but for this subsection would be
made under subsection (1) for a debt incurred by the deceased as
mentioned in paragraph (i) of that subsection, or for an incum-
brance created by a disposition made by the deceased, as therein
mentioned shall be subject to abatement to an extent proportionate
to the value of any of the consideration given therefor which
consisted of-

(a) property derived from the deceased; or

(b)consideration not being such property as aforesaid, but
given by any person who was at any time entitled to, or
amongst whose resources there was at any time included,
any property derived from the deceased:

Provided that if, where the whole or a part of the consideration
given consisted of such consideration as is mentioned in para-
graph (b) of this subsection, it is proved to the satisfaction of the





Commissioner that the value of the consideration given, or of that
part thereof, as the case may be, exceeded that which could have
been rendered available by application of all the property derived
from the deceased, other than such, if any, of that property as is
included in the consideration given or as to which the like facts
are proved in relation to the giving of the consideration as are
mentioned in the first proviso to section 6(1)(f) in relation to the
purchase or provision of an annuity or other interest, no abatement
shall be made in respect of the excess, and in this subsection the
expressions 'property derived from the deceased' and -subject
matter' have the meanings respectively attributed to them in section
6(1)(f). (Added, 1 of 1959, s. 6)

(3) Where a debt or incumbrance has been incurred or created
in whole or in part for the purpose of or in consideration for the
purchase or acquisition or extinction, whether by operation of law
or otherwise, of any interest in expectancy in any property passing
or deemed to pass on the death of a deceased person, and any person
whose interest in expectancy is so purchased, acquired, or extin-
guished becomes (under any disposition made by, or through devolu-
tion of law from, or under the intestacy of, the deceased) entitled to
any interest in that property, then in determining the value of the
estate of the deceased for the purpose of estate duty no allowance
shall be made in respect of such debt or incumbrance, and any
property charged with any such debt or incumbrance shall be
deemed to pass freed from that debt or incumbrance:

Provided that-

(a)if part only of such debt or incumbrance was incurred or
created for such purpose or as such consideration as
aforesaid, this provision shall apply to that part of such
debt or incumbrance only; and

(b)if a person whose interest in expectancy in the property so
purchased, acquired, or extinguished becomes entitled to
an interest in part only of that property, this provision
shall apply only to such part of the debt or incumbrance as
bears the same proportion to the whole debt or incum-
brance as the value of the part of the property to an interest
in which he becomes entitled bears to the value of the
whole of that property.

(4) No allowance shall be made f r de
~,~ kt~
du,~from the
tv
deceased, other than debts contracted M49 y persons
ordinarily resident therein, unless charged on property situate within

(5)(a) The principal value of any property shall be estimated
to be the price which, in the opinion of the Commissioner.
such property would fetch if sold in the open market at the
time of the death of the deceased.

(b)In estimating such principal value the Commissioner shall
not make any reduction in the estimate on account of the





estimate being made on the assumption that the whole
property is to be placed on the market at one and the
same time:
Provided that where it is proved to the Commissioner
that the value of the property has been depreciated by the
reason of the death of the deceased the Commissioner in
fixing the price shall take such depreciation into account.
(6) When an estate includes an interest in expectancy, estate
duty in respect of that interest shall be paid, at the option of the
person accountable for the estate duty, either with the duty in
respect of the rest of the estate or when the interest falls into
possession, and if the duty is not paid with the estate duty in respect
of the rest of the estate, then-
(a)for the purpose of determining the rate of estate duty in
respect of the rest of the estate the value of the interest shall
be its value at the date of the death of the deceased; and
(b)the rate of estate duty in respect of the interest when it falls
into possession shall be calculated according to its value
when it falls into possession, together with the value of the
rest of the estate as previously ascertained.
(7) The value of the benefit accruing or arising from the cesser
of an interest ceasing on the death of the deceased shall-
(a)if the interest extended to the whole income of the pro-
perty, be the principal value of that property; and
(b)if the interest extended to less than the whole income of
the property, be the principal value of an addition to
the property equal to the income to which the interest
extended.
(8) The value of any property for the purpose of estate duty
shall be ascertained by the Commissioner in such manner and by
such means as he thinks fit, and, if he authorizes any person to
inspect any property and to report to him the value thereof for the
purposes of this Ordinance, the person having the custody or
possession of that property shall permit the person so authorized to
inspect it at such reasonable times as the Commissioner considers
necessary.
(9) When the Commissioner requires a valuation to be made
by a person named by him, the reasonable costs of such valuation
shall be defrayed by the Commissioner.

14. (1) All duty, interest and penalties payable under this
Ordinance shall be recoverable by the Commissioner by action in the
District Court, notwithstanding that the amount is in excess of the
sum mentioned in section 33 of the District Court Ordinance:
(Amended, 68 of 1973, s. 5 and 79 of 1981, s. 3)
Provided that nothing in this section shall affect any other
remedy for the recovery of duty, interest or penalties payable under
this Ordinance.(Replaced, 47 of 1962, s. 7)





(2) In proceedings in the District Court under this section the
production of a certificate signed by the Commissioner stating the
name and last known postal address of the person sued and the
particulars of the duty, interest or penalty claimed from him shall be
sufficient evidence of the amount so claimed and sufficient authority
for the District Court to give judgment for such amount. (Added,
47 of 1962, s. 7. Amended, 31 of 1976, s. 3)

(2A) In proceedings under this section for the recovery of any
duty, interest or penalties the court shall not entertain any plea
that the amount claimed is excessive, incorrect or under appeal.
(Added, 31 of 1976, s. 3)

(3) In proceedings in the District Court under this section, the
Commissioner may appear in person or may be represented either by
a legal officer within the meaning of the Legal Officers Ordinance or
by any other person authorized by him in writing. (Added, 47 of
1962,s. 7)

(4) In any proceedings for the recovery of any such duty,
interest, fine, penalty or forfeiture in respect of any property passing
on the death of any person on or after 1 January 1916, it shall not be
necessary to issue concurrent writs, informations or other process.
Service of the writ, information or other process shall, where
practicable, be personal; but the order of a judge may be obtained, in
special circumstances, to dispense with personal service and giving
directions as to substituted service or as to notice of the proceedings
and time for appearance whether by posting copies to addresses
within or without the jurisdiction or otherwise as in the circum-
stances may seem just.

(5) In any such proceedings the court shall have jurisdiction to
appoint a receiver of the property and the rents and profits thereof
and to order a sale of the property. The provisions of Order 30, rules
2 and 3 of the Rules of the Supreme Court shall apply in the case of
any order made under this subsection.

(6) Subject to section 14A, every executor shall, to the best of
his knowledge and belief, specify in appropriate accounts annexed to
an affidavit for the Commissioner all the property in respect of
which estate duty is payable upon the death of the deceased, and
also (unless exempted in writing by the Commissioner) any property
of which the deceased was a trustee for another person, and shall be
accountable for the estate duty in respect of all property, of which
the deceased was competent to dispose at his death, but shall not be
liable for any duty in excess of the assets which he has received as
executor or might but for his own neglect or default have received.
(Amended, 27 of 1972, s. 4)

(7) Where property passes on the death of the deceased and his
executor is not accountable for the estate duty in respect of such
property. every person to whom any property so passes for any
beneficial interest in possession, and also to the extent of the
property actually received or disposed of by him, every trustee,
guardian, committee or other person in whom any interest in the





property so passing or the management thereof is at any time vested,
and every person in whom the same is vested in possession by
alienation or other derivative title, shall be accountable for the estate
duty on the property, and shall, within the time required by this
Ordinance or such later time as the Commissioner allows, deliver to
the Commissioner an appropriate account specifying the property in
question to the best of his knowledge and belief..
Provided that nothing in this section shall render a person
accountable for duty who acts merely as agent for another person
in the management of property.
(7A) Notwithstanding subsections (6) and (7), where a bene-
ficial interest in property vested in the deceased and another person
jointly passes or accrues by survivorship on the dealth of the
deceased-
(a) the executor; and
(b)the person to whom the beneficial interest so passes or
accrues,
shall be accountable for the estate duty in respect of such property
and shall, within the time required by this Ordinance, or such later
time as the Commissioner allows, deliver to the Commissioner an
appropriate account specifying the property in question to the best
of his (or their) knowledge and belief. (Added, 29 c!f 1970, s. 4)
(8) The Commissioner may summon before him any person
accountable for estate duty or any person who is, in the opinion of
the Commissioner, so accountable, and any person whom the
Commissioner believes to have taken possession of or administered
any part of the estate in respect of which estate duty is leviable on the
death of the deceased, or of the income of any part of such estate,
and any person whom the Commissioner believes to be indebted to
the deceased, and any person whom the Commissioner believes to be
capable of giving information as to such estate and may examine
such person and may require any such person to produce any
documents in his custody or power the inspection whereof may tend
to secure the payment of any duty under this Ordinance or the proof
or discovery of any fraud or omission in relation to any such duty.
Any such person shall at all reasonable times permit any person
thereunto authorized by the Commissioner to inspect all such
documents as aforesaid and to make such notes, copies or extracts
thereof or therefrom as he may deem necessary without fee or
reward. The Commissioner may also require any such person to
deliver to him and verify on oath a statement in writing c!f such
particulars. (Amended, 29 of 1970, s. 4)
(9) Subsection (8) shall apply to any company on a death on
which it appears to the Commissioner that section 35 or 44 has effect
in respect of that company, and to every person who is or was at any
time an officer, or an auditor of that company, as it applies to a
person whom the Commissioner believes to have taken possession of
or administered any part of an estate in respect of which estate duty
is leviable. (Added, 1 of 1959, s. 7)





(10) Nothing in this section shall render a bona fide purchaser
for valuable consideration without notice liable to or accountable
for estate duty.

(11) All affidavits and accounts required under this section shall
be delivered to the Commissioner, who shall make such inquiry
respecting the contents of, or the particulars verified by, such
affidavit or accounts and the value of the various properties included
therein as he thinks necessary, and the person making or tendering
any such affidavit shall attend at the office of the Commissioner,
whenever required by him, and shall furnish and produce such
explanations and documentary or other evidence as the Commis-
sioner may require.

(12) When the Commissioner has ascertained the amount of
estate duty payable in respect of any accounts delivered to him in
pursuance of this Ordinance he shall notify the accountable person
of his decision by means of a certificate in the prescribed form. If
such amount exceeds the amount of estate duty already paid in
respect of the said accounts the accountable person shall forthwith
pay the excess to the Commissioner.

(13) In every case in which the Commissioner is satisfied that
too much estate duty has been paid, the excess, together with any
interest which has been paid in accordance with section 12(6), shall
be repaid by the Commissioner. (Replaced, 29 of 1970, s. 4)

(14) Where the accountable person discovers that for any
reason too little estate duty has been paid he shall forthwith deliver
to the Commissioner a further account, verified by oath, and shall at
the same time pay the difference between the estate duty chargeable
according to the true value of the estate and the estate duty already
paid.

(15) Notwithstanding subsection (12) and section 12, if-

(a)the Commissioner is not satisfied with the affidavit or
accounts delivered by any person; or

(b)a person has not delivered an affidavit or accounts within 6
months after the death, whether or not he has been
required by the Commissioner so to do, and the Commis-
sioner is of the opinion that such person is accountable for
estate duty,

the Commissioner may, according to the best of his judgment, assess
the amount of estate duty which is in his opinion payable and he
shall thereupon notify the person who is in his opinion accountable
and call upon him to pay such estate duty. (Replaced, 29 of 1970,
s.4)

(15A) Notwithstanding subsection (12) and section 12, the
amount of estate duty assessed under subsection (15) shall be paid
within one month after the giving of notice by the Commissioner.
(Added, 29 of 1970, s. 4)





(16) The Commissioner may remit the interest payable on
estate duty where the amount of such interest is in his opinion so
small as not to repay the expense and labour of calculation and
account.

(17) Every person or company who without lawful authority or
reasonable cause fails to comply with any of the provisions of this
section shall be liable to pay to the Commissioner, in addition to the
estate duty (if any)-

(a)a penalty of 51,000 or, in the case of such a company as is
referred to in subsection (9) or an officer or auditor of such
a company, $5,000; or

(b )a penalty equal to the amount of the estate duty (if any) at
the rate set out in the applicable Schedule remaining
unpaid for which he or the company is accountable,

according as the Commissioner elects. (Replaced, 29 of 1970, s. 4)

14A. (1) If the Commissioner is satisfied-

(a)that an executor has, to the best of his knowledge and
belief, disclosed in such manner as the Commissioner may
determine-
(i) all of the property belonging to a deceased; and
(ii) all of the property held by the deceased as trustee
for another person;

(b)that the principal value of the property belonging to the
deceased does not exceed 5400,000; and

(c) that no estate duty is payable on the death of the deceased,

the Commissioner may, subject to any conditions which he may
specify, exempt the executor from section 14(6).

(2) Where the Commissioner exempts any executor under
subsection (1) he shall issue to the executor a certificate of exemp-
tion in such form as he may determine.

(3) If, at any time after he has issued to an executor a
certificate of exemption under subsection (2), the Commissioner has
reasonable grounds for believing-

(a)that the principal value of the property belonging to the
deceased exceeds $400,000; or

(b) that estate duty is payable on the death of the deceased,

the Commissioner may withdraw the exemption granted to the
executor under subsection (1) and cancel the certificate of exemp-
tion, whereupon this Ordinance shall apply as if the exemption had
not been granted.
(Added, 21 of 1972, s. 5.Amended, 29 of 1981, s. 5)





15. (1) No probate or letters of administration shall be issued
by the court until the Commissioner shall have certified in writing
that the estate duty payable by the executor upon the estate in
respect of which probate or letters of administration is sought has
been paid or that he has allowed payment thereof to be postponed
under subsections (2) and (3). (Amended, 1 of 1959, s. 8)

(2) When the affidavit for the Commissioner contains the
statement and undertaking specified in section 12(3), the Commis-
sioner may allow payment of the whole or any part of the estate duty
to be postponed until after the issue of probate or letters of
administration upon condition that a further and complete affidavit
shall be filed and the proper estate duty paid thereon as soon as the
full value of the estate has been ascertained and the Commissioner
may require the person applying for such probate or letters of
administration to enter into a bond with or without sureties in such
an amount as he shall think fit to secure the filing of such affidavit as
aforesaid and the payment of the proper estate duty thereon within
such time as shall be named in such bond. Such bond may be in the
prescribed form.

(3) Where the Commissioner is satisfied that the estate duty
leviable in respect of any property cannot without excessive sacrifice
be raised at once, he may allow payment to be postponed for such
period, to such extent and on payment of such interest not exceeding
8 per cent per annum or any higher interest yielded by the property,
and on such terms as the Commissioner may think fit.

(4) Where the Commissioner allows payment to be postponed
under subsection (2), he may reduce or remit any interest payable.

16. (1) In every case where any account is delivered after the
lapse of 12 months from the death, the estate duty shall, without
prejudice to the exercise of the Commissioner's discretion under
section 27, be charged at twice the rates set out in the applicable
Schedule, unless the person accountable for the estate duty satisfies
the Commissioner that there is a reasonable excuse for the delay in
the delivery of the account: (Replaced, 47 of 1962, s. 8)

Provided that in any case in which, before the delivery of the
account, a grant of probate or of letters of administration or its
had been obtained from a competent court outsideMtL--
e period shall be 18 months from the death instead of one
year:

Provided also that unless the Commissioner in any particular
case with the approval of the Governor in Council otherwise
directs-

(a)in the case of any death occurring before 8 December 1941,
the period from such date to 2 March 1946 shall not be
taken into consideration for the purposes of this subsec-
tion. and





(b)in the case of any death occurring on or after 8 December
1941 and before 2 March 1946, the latter date shall be sub-
stituted for the date of the death referred to in the second
and eleventh lines of this subsection. (Added, 24 of 1950,
Schedule)

(2) For the purposes of this section, no account shall be
deemed to have been delivered until the duty which reasonably
appears to be payable in respect thereof has been paid, unless the
Commissioner shall have allowed payment of the estate duty in
respect of the said account to be postponed.

(3) For the purposes of this section, interest shall be charged
only on the duty which would have been payable if the duty had
been charged at the rate set out in the applicable Schedule.
(Added, 4 7 of 1962, s. 8)

17. (1) Every executor, within one year after obtaining pro-
bate or letters of administration to the estate of a deceased person
and before selling or otherwise disposing of any shares in any
istered under or incorporated by any Ordinance of-ti;~-
shares the deceased person was at the date of his
death the beneficial owner under a transfer in blank and not the
registered owner, shall cause such shares to be transferred on
the registers of the appropriate companies into the name of the
deceased, who shall then be deemed to have been so registered at
the time of his death.

(2) Every such company, notwithstanding anything in any
enactment or in its constitution, memorandum, articles or regula-
tions to the contrary, shall effect registration on payment of the
usual registration charges (if any) and in default shall be liable on
summary conviction to a fine of 51,000.

(3) Every executor who without reasonable excuse omits to
obtain the registration of any such shares as aforesaid within the
time limit aforesaid shall be liable to pay to the Commissioner in
addition to the estate duty (if any) a penalty of $1,000, or, at the
option of the Commissioner, a penalty equal to the amount of the
estate duty (if any) at the rate set out in the applicable Schedule.

18. (1) Subject to subsection (2)-

(a)a rateable part of the estate duty on an estate, in propor-
tion to the value of any property which does not pass to the
executor as such, shall be a first charge on the property in
respect of which estate duty is leviable;

(b)a rateable part of the estate duty on an estate paid by in-
stalments under section 12(8), in proportion to the value of
any leasehold property held solely by the deceased, shall be
a first charge on the property:

Provided that the property shall not be chargeable as against a
bona fide purchaser thereof for valuable consideration without
notice.(Replaced, 1 of 1959, s. 15)





(2) Notice of any charge on any leasehold property consti-
tuted by subsection (1) may be given by the Commissioner register-
ing in the Land Office against the property affected thereby a
Memorial signed by him specifying the subsection under which the
charge is constituted, the name, description, and date of death of the
deceased in respect of whose estate the claim to estate duty arises,
and particulars of the property charged. (Added, 1 of 1959, s. 15)

(3) A notice in writing of any charge under subsection (1)
or (2) may be entered in the Land Office as an instrument affecting
land. (Added, 1 of 1959, s. 15)

(4) If the rateable part of the estate duty in respect of any
property is paid by the executor, it shall where occasion requires be
repaid to him by the trustees or owners of the property.

(5) A person authorized or required to pay the estate duty in
respect of any property shall, for the purpose of paying the estate
duty or raising the amount of the estate duty when already paid,
have power, whether the property is or is not vested in him, to raise
the amount of such estate duty and any interest and expenses
properly paid or incurred by him in respect thereof by the sale or
mortgage or a terminable charge on that property or any part
thereof.

(6) A person having a limited interest in any property who
pays the estate duty in respect of that property shall be entitled to the
like charge as if the estate duty in respect of that property had been
raised by means of a mortgage to him.

(7) Any money arising from the sale of property comprised in
a settlement or held upon trust to lay out upon the trusts of a
settlement may be expended in paying any estate duty in respect of
property comprised in the settlement and held upon the same trusts.

19. (1) In the case of property which does not pass to the
executor as such, an amount equal to the proper rateable part of the
estate duty may be recovered by the person, who being authorized or
required to pay the estate duty in respect of any property has paid
such duty, from the person entitled to any sum charged on such
property (whether as capital or as an annuity or otherwise) under a
disposition not containing any express provision to the contrary.

(2) Any dispute as to the proportion of estate duty to be borne
by any property or person may be determined upon application by
way of summons in the High Court, and where the amount claimed
does not exceed the sum mentioned in section 33 of the District
Court Ordinance such application shall be made to the District
Court. (Amended, 35 of 1950, s. 4; 35 of 1966, s. 6; 68 of 1973,
s. 5 and 79 of 1981, s. 3)

(3) Any party from whom a rateable part of estate duty can be
recovered under this section shall be bound by the accounts and
valuations as settled between the person entitled to recover the same
and the Commissioner.





20. The Governor in Council may remit the payment of any
estate duty or may order a refund of the whole or any portion of any
estate duty which may have been paid to the Commissioner, for the
remission or refund of which any equitable claim is proved to his
satisfaction:

Provided that in respect of deaths occurring on or between 8
June 1941 and 1 March 1946, the Commissioner in lieu of the
Governor in Council may remit the payment of any estate duty or
order the refund of the whole or any portion of any estate duty, and
for the purpose of the exercise of such discretion the Commissioner
shall take into account the provisions of paragraph 1 of Order No. 3,
made on 1 March 1946, under Proclamation No. 16 made by the
British Military Administration, as amended from time to time,
whether that Order shall have been repealed or not. (Added, 24 of
1950, Schedule)

21. Where the Commissioner is satisfied-

(a)that estate duty has become payable on property passing
on a death between 8 December 1941 and 16 September
1945 of a person who-
(i) dies from wounds inflicted, accident occurring or
disease contracted, within 3 years before death, on active
service against the enemy on land or sea or in the air or on
service which in the opinion of the Commissioner is of a
warlike nature or involves the same risk as active service
and such person was at the time when the wounds were
inflicted or when the accident occurred or disease was
contracted subject to any naval military or air force
discipline; or
(ii) dies from injuries received within 3 years of death
and which were in the opinion of the Commissioner caused
by operations 0 ~waror r peived during internment or
imprisonment in Kyy~or in any territory controlled
at the time of such internment or imprisonment by a
sovereign or state then at war with His Majesty or dies
from any cause which in the opinion of the Commissioner
was attributable to such internment or imprisonment; and

(b)that subsequent estate duty has again become payable
during the same period on the same property or any part
thereof on another such death, being the death of a person
to whom that property or that part thereof passed on the
earlier death,

then the whole of the estate duty payable on the later death on that
property or that part thereof shall be remitted or, if paid, shall be
repaid. That property or that part thereof shall not be aggregated
with any other property passing on a later death for the purpose of
determining the rate of estate duty.
(Added, 24 of 1950, Schedule)





22. (1) Any person who is aggrieved by a decision of the
Commissioner under section 14(12) or by an assessment of the
Commissioner under section 14(15) as to the amount of estate duty
payable and whether he is aggrieved on the ground of-

(a)property being considered to be property in respect of
which estate duty is payable and for which he is considered
accountable;

(b) the valuation of any property; or

(c) the rate of duty charged,

may, subject to subsection (1A), on payment of or giving security for
as hereinafter mentioned, the duty claimed by the Commissioner or
such portion of it as is then payable by him, appeal to the High
Court within 3 months from the date of notification of the decision
or assessment and his accountability or the amount of duty payable
shall be determined by the High Court and if the duty is less than
that paid to the Commissioner or if no duty is payable the excess
shall be repaid. (Replaced, 29 of 1970, s. 5)

(IA) The Commissioner may, where satisfied that a person
proposes to appeal under subsection (1), allow payment of the duty
claimed by him to be postponed for such period, to such extent and
on payment of such interest (if any) not exceeding 8 per centum per
annum and on such terms as the Commissioner may think fit.
(A dded, 29 qf 1970, s. 5)

(IB) Where the value of the property as alleged by the Corn-
missioner in respect of which the dispute arises does not exceed
$200,000 the appeal under this section shall be to the District
Court. (Added, 29o]*1970, s. 5. Amended, 79of]981,s.2)

(IC) The amount mentioned in subsection (IB) may be
amended by resolution of the Legislative Council. (Added, 79 of
1981,s.2)

(2) No appeal shall be allowed from any order, direction,
determination or decision of the High Court or the District Court
under any appeal under this section except with the leave of the High
Court or the District Court, as the case may be, or of the Court of
Appeal. (Added, 29 of 1970, s. 5)

(3) The costs of the appeal shall be in the discretion of the
court, and the court, where it appears to the court just, may order
the Commissioner to pay on any excess of duty repaid by him
interest at such rate per cent per annum and for such period as
appears to the court just.

(4) Provided that the High Court or the District Court, as the
case may be, if satisfied that it would impose hardship to require the
appellant as a condition of the appeal to pay the whole or, as the
case may be, any part of the duty claimed by the Commissioner or of
such portion of it as is then payable by him, may allow an appeal to
be brought on payment of no duty or of such part only of the duty as





to the court seems reasonable and on security to the satisfaction of
the court being given for the duty or so much of the duty as is not
paid, but in such case the court may order interest at such rate per
cent per annum as appears to the court just to be paid on the unpaid
duty so far as it becomes payable under the decision of the
court. (Amended, 29 of 1970, s. 5)

23. (1) A schedule under the hand of the Commissioner of all
the property passing on the death of a deceased person upon which
estate duty has been paid or is payable on the death, and of all the
property of a deceased person which, being trust property, is exempt
from duty on the death shall be annexed to the probate or letters of
administration, and any person who, without lawful authority or
reasonable excuse, in any way deals with any estate of the deceased
or any property held by the deceased in trust, which is not set out in
such schedule, shall be liable to a penalty of S1,000, or to a penalty
equal to 3 times the amount of the estate duty at the rate set out in
the applicable Schedule to this Ordinance payable upon the estate so
dealt with, at the election of the Commissioner:

Provided that the disclosure of any trust relating to property in
any such schedule shall not constitute notice of the trust as against
any purchaser or mortgagee for valuable consideration.

(2) Whenever a further affidavit is delivered, the probate or
letters of administration in respect of which such affidavit is delIV-
ered shall be lodged with the Commissioner who shall insert in the
schedule particulars of the additional property set out in the said
affidavit.

(3) Where the Commissioner has granted exemption to an
executor under section 14A(I)-

(a)there shall be annexed to the probate or letters of adminis-
tration the certificate of exemption issued to the executor
under section MA(2); and

(b)the penalties referred to in subsection (1) of this section
shall apply to any person who, without lawful authority or
reasonable excuse, in any way deals with any property-
(i) belonging to a deceased; or
(ii) held by a deceased in trust for another person,

which was not disclosed to the Commissioner under
section 14A(I). (Added, 21 of 1972, s. 6)

24. (1) Subject to subsection (3A), every person who. being
neither the executor appointed by the will of the deceased nor (in the
case of an intestacy) the person entitled in priority to the administra-
tion of the estate of the deceased, without lawful authority or excuse
or without first delivering to the Commissioner accounts of the
estate of the deceased as required by section 14, takes possession of
or in any way administers any part of the estate of a deceased
person, or any part of the income of any part of such estate, shall be





liable to a penalty of 51,000 and shall also be liable to a further
penalty equal to 3 times the amount of the estate duty at the rate set
out in the applicable Schedule payable upon the whole estate of the
deceased. (Amended, 21 of 1972, s. 7)

(2) Subject to subsection (3A), every person who, being the
executor appointed by the will of the deceased or (in the case of an
intestacy) the person entitled in priority to the administration of the
estate of the deceased, takes possession of or in any way administers
any part of the estate of a deceased person or any part of the income
of any part of such estate, with 6 months of the death of the deceased,
and fails within the said period of 6 months to deliver to the
Commissioner accounts of the estate of the deceased as required by
section 14, shall be liable to a penalty of $1,000, and shall also be
liable to a further penalty equal to 3 times the amount of the estate
duty at the rate set out in the applicable Schedule payable upon the
whole estate of the deceased. (Amended, 21 of 1972, s. 7)

(3) Subject to subsection (A), every person who, being the
executor appointed by the will of the deceased or (in the case of an
intestacy) the person entitled in priority to the administration of the
estate of the deceased, takes possession of or in any way administers
any part of the estate of a deceased person, or any part income of
any part of such estate, after the expiration of 6 months from the
death of the deceased. without first delivering to the Commissioner
accounts of the estate of the deceased as required by section 14, shall
be liable to a penalty of 51,000 and shall also be liable to a further
penalty equal to 3 times the amount of estate duty at the rate set out
in the applicable Schedule payable on the whole estate of the
deceased. (Amended, 21 of 1972, s. 7)

(3A) Subsections (1). (2) and (3) shall not apply in any case
where the Commissioner has granted exemption to an executor
under section 14A(I). (Added, 21 of 1972, s. 7)

(4) The Commissioner shall have power to allow in writing the
use of any specified part of the estate of a deceased person, or of any
specified part of the income of any such estate, for the purpose of the
burial of the deceased or for the prupose of the maintenance of the
former dependants of the deceased notwithstanding the non-delivery
of the accounts required by section 14, or for the purpose of
preparing such accounts, and such authorized use of the estate or
income as the case may be shall not render the person in question
liable to any of the penalties provided by this section.

(5) The recovery of any penalty provided in this section shall
be without prejudice to the liability of the accountable person to the
payment of estate duty on the estate of the deceased:

Provided however that the amount of the estate duty and the
penalty shall not in any case exceed 4 times the rate set out in the
applicable Schedule.

(6) For the purposes of this section, no account shall be
deemed to have been delivered until the duty which reasonably





appears to be payable in respect thereof has been paid, unless the
Commissioner shall have allowed payment of the estate duty in
respect of the said account to be postponed.

25. (1) Where a deceased person had at the date of his death
any interest, whether as partner de os . t r o creditor, in any bank
or business undertaking withi 1;,~the bank or business
undertaking, or, in the case of a bank or business undertaking which
is not a body corporate, the person having the management thereof.
shall, within one month from the date of first receiving information
of either his interest or the death of such deceased person, whichever
shall be the later, notify the Commissioner of such death and of the
extent of the interest of the deceased in the bank or business under-
taking, and in default of such notification as aforesaid a penalty of
$1,000 shall be recoverable from the bank or business undertaking,
or the owner thereof in the case or an unincorporated body.

(2) Where any business undertaking is carried on in a firm
name the penalty prescribed by this section shall also be deemed to
be due from the firm and may be recovered in an action against the
firm in the firm name.

(3) In any proceedings for the recovery of the penalty pre-
scribed by this section, the onus of proving that he has not rendered
himself liable to the penalty shall be on the person. company or firm
from whom it is sought to recover it.
(Replaced, 29 of'1970, s. 6)

26. At any time or times after the date of the probate or letters
of administration, it shall be lawful for the Commissioner, by notice
in writing sent to an executor at his last-known address, to require
him to deliver to the Commissioner a statement in writing (which
statement in writing shall be supported by a statutory declaration if
the Commissioner shall so require) containing the names and
addresses of all persons who were and are beneficially interested in
the estate of the deceased, together with the respective dates on
which such persons respectively became so interested and the extent
of their respective interests, and also all such particulars in regard to
such persons or any of them as the Commissioner may from time to
time require, and the executor shall, within 2 months from the date
of the service of such notice at such address, deliver the said
statement to the Commissioner and shall verify the same to his
satisfaction within the further period of one month. and in default
the executor shall be personally liable on summary conviction to a
fine of $1,000 or to imprisonment for 6 months.unless he can prove
to the satisfaction of the magistrate that his default was due to
circumstances not under his control.

27. The Commissioner may in his discretion remit or reduce
any penalty or the interest on any duty and he may reduce any duty
chargeable under this Ordinance, provided that such duty is not
reduced below the rate set out in the applicable Schedule.
(Amended, 47 of 1962, s. 10)





28. Subject to the provisions of this Ordinance, the Governor
in Council rnay make such rules, prescribe such forms and generally
do such things as he thinks expedient for regulating the practice
under this Ordinance. The powers conferred by this section shall
include a power to prescribe fees and charges in respect of affidavits
for the Commissioner.
29. (1) If the registered owner of any'll arre 9 s4
ye register
which is by law required to be kept withi'ill ~y dies, such
shares shall for the purposes of this Ordinance be deemed to be part
of the estate of the deceased, unless the executor of the deceased
proves to the satisfaction of the Commissioner that such share did
not form part of the estate of the deceased at his death. (Amended,
29 of 1970, s. 7)

(2) An appeal to the High Court as under section 22 shall lie
from any decision of the Commissioner under subsection (1).

30. (1) If estate duty has already been paid in respect of any
settled property since the date of the settlement, upon the death of
one of the parties to a marriage, no estate duty shall be payable on
the death of the other party to the marriage unless such person was
at the time of his or her death or had been at any time during the
continuance of the settlement competent to dispose of such property.

(2) For the purposes of this section, the term -settlement-
means any deed. will, agreement for a settlement. or other instru-
ment. or any number of instruments, whether made before or after
or partly before and partly after the commencement of this Ordin-
ance, under or by virtue of which instrument or instruments any
property. or any estate or interest in any property, stands for the
time being limited to or in trust for any persons by way of succession,
and the term -settled property- means the property comprised in a
settlement.

31. Where the Commissioner is satisfied that estate duty has
become payable on any property consisting of leasehold property or
a business (not being a business carried on by a company), or any
interest in leasehold property or such a business, passing upon the
death of any person, and that subsequently within 5 years estate
duty has again become payable on the same property or any part
thereof passing on the death of the person to whom the property
passed on the first death. the amount of estate duty payable on the
second death (if the death occurs on or after 27 February 1931), in
respect of the property so passing shall be reduced as follows-

(a)where the second death occurs within 1 year of the first
death, by 50 per cent;

(b)where the second death occurs within 2 years of the first
death, by 40 per cent.

(c)where the second death occurs within 3 years of the first
death. by 30 per cent;





(d)where the second death occurs within 4 years of the first
death, by 20 per cent.

(e)where the second death occurs within 5 years of the first
death, by 10 per cent:

Provided that where the value, on which the duty is payable, of
the property on the second death exceeds the value, on which the
duty was payable, of the property on the first death. the latter value
shall be substituted for the former for the purpose of calculating the
amount of duty on which the reduction under this section is to be
calculated.

32. The amount of estate duty payable on an estate at the rate
applicable thereto under the scale of rates of duty shall, where
necessary, be reduced so as not to exceed the highest amount of duty
which would be payable at the next lower rate, with the addition of
the amount by which the value of the estate exceeds the value on
which the highest amount of duty would be so payable at the lower
rate.

33. (1) In the case of settled property, where the interest of
any person under the settlement fails or determines by reason of his,
death before it becomes an interest in possession, and subsequent
limitations under the settlement continue to subsist, the property,
shall nojt be deemed to pass on his death.

(2) For the purposes of this section, the term 'settlement'
means any deed, will, agreement for a settlement. or other instru-
ment, or any number of instruments, whether made before or after
or partly before and partly after 27 February 193 1, under or by virtue
of which instrument or instruments any p~operty, or any estate or
interest in any property, stands for the time being limited to or in
trust for any persons by way of succession, and the term 'settled
property' means the property comprised in a settlement.

34. (1) The companies to which sections 35, 41, 44 and 45
respectively apply are any company which, at any relevant time, is
deemed to have been under the control of not more than 5 persons
not being a company which, at any such time, is deemed to have been
either a subsidiary company or a company in which the public were
substantially interested.

(2) A company shall be deemed to be under the control of not
more than 5 persons-

(a)if any 5 or fewer persons together exercise. or are able to
exercise, or are entitled to acquire, control, whether direct
or indirect, over the company's affairs, and in particular,
but without prejudice to the generality of the foregoing
words, if any 5 or fewer persons together possess, or are
entitled to acquire, the greater part of the share capital or
voting power of the company; or





(b)if any 5 or fewer persons together possess, or are entitled to
acquire, either the greater part of the issued share capital of
the company, or such part of that capital as would, if the
whole of the profits of the company had been in fact
distributed to the members, entitle them to receive the
greater part of the amount so distributed; or

(e)if in any relevant accounting year, more than half of the
profits of the company have been, or could have been,
apportioned among not more than 5 persons; or

(d)if any 5 or fewer persons would, if the company were
wound up, be entitled as members or loan creditors of the
company to receive more than half of the assets of the
company which would be available for distribution to
members and loan creditors.

(3) In determining for the purposes of subsection (2) whether a
company is deemed to be under the control of not more than 5
persons, persons in any one of the following classes shall be treated
as a single person with other persons of that same class, namely-

(a) persons who are relatives of one another;

(b) nominees of another person together with that person;

(c)persons in a partnership within the meaning of section 3 of
the Partnership Ordinance, and

(d)persons interested 'In any shares or obligations of the
company which are subject to any trust or are part of the
estate of a deceased person.

(4) For the purposes of subsection (3), a person shall be
deemed to be the nominee of another person if, whether directly or
indirectly, he possesses on behalf of that other person, or may be
required to exercise on the direction of or on behalf of that other
person, any right or power which is material in determining whether
a company is, or is not to be deemed to have been under the control
of not more than 5 persons.

(5) A company shall be deemed to be-

(a)'a subsidiary company' if, by reason of the beneficial
ownership of shares therein, the control of the company is
in the hands of a company not being a company to which
the provisions of this section apply, or of 2 or more
companies none of which is a company to which the said
provisions apply; and

(b)'a company in which the public were substantially in-
terested' if shares of the company (not being shares
entitled to a fixed rate of dividend, whether with or without
a further right to participate in profits) carrying not less
than 25 per cent of the voting power were allotted
unconditionally to, or acquired unconditionally by, and
were at the end of the year or other period for which the





accounts of the company were made up beneficially held
by, the public (not including a company to which the
provisions of this section apply), and any such shares were
in the course of such year or other period the subject of
dealings on a stock exchange approved or deemed to have
been approved under section 25 of the Securities Ordinance
and the shares were quoted in any list of such exchange.

(Amended, 12 of 1974, s. 150)

(6) For the purpose of this section and in relation to any body
corporate incorporated outside the Colony

(a)references to winding-up shall include references to the
dissolution or cancellation of the registry of the body
corporate in any manner authorized by any rules, regula-
tions or other instrument constituting or regulating the
body corpoate or any enactment applying to the body
corporate; and

(b)references to an order or resolution for winding-up shall
include references to the signing of any instrument, the
making of any application or the doing of any other act
which is authorized as aforesaid with a view to dissolving.
or cancelling the registry of, the body corporate; and

(c)references to the liquidator shall include references to any
person in charge of the winding-up of the affairs of the
body corporate.

(7) In this section-

Ioan creditor' means a creditor in respect of any debt incurred by
the company-

(a)for any money borrowed or capital assets acquired by the
company; or

(b)for any right to receive income created in favour of the
company; or

(c)for consideration the value of which to the company was,
at the time when the debt was incurred, substantially less
than the amount of the debt including any premium
thereon,

or in respect of any redeemable loan capital issued by the
company:

Provided that a bank licensed to carry on banking business
under section 7 of the Banking Ordinance, shall not be deemed
to be a loan creditor in respect of any loan capital or debt issued
or incurred by the company for money lent by, such bank to the
company in the ordinary course of the bank's business;

'member' includes any person having a share or interest in the
capital or profits of a company;

'relative' has the meaning attributed thereto in section 7; and





'relevant time' means any time during the period ending with the
death of the deceased and beginning, as respects section 44,
3 years before his death, and, as respects sections 35, 41 and 45
at the date of the disposition transfer or other transaction or
event relevant for the purposes of those sections, or if that
disposition transfer or other transaction or event was one of
associated operations, at the date of the earliest of those
operations.
(Added, 1 of 1959, s. 10)

35. (1) Where a person has made to a company to which this
section applies a transfer of any property, other than an interest
limited to cease on his death or property which he transferred in a
fiduciary capacity, and any benefits accruing to the deceased from
the company accrued to him in the 3 years ending with his death, the
assets of the company shall be deemed for the purposes of estate
duty to be included in the property passing on his death to an extent
determined, in accordance with subsection (2), by reference to the
proportion that the aggregate amount of the benefits accruing to the
deceased from the company bore to the net profits of the company.

(2) The extent to which the assets of the company are to be
deemed to be included as aforesaid shall be the proportion ascer-
tained by comparing the aggregate amount of the benefits accruing
to the deceased from the company in the last 3 accounting years with
the aggregate amount of the net profits of the company for the said
year:

Provided that-

(a)where, in any of the said accounting years, the company
sustained a loss, the amount of that loss shall be deducted
in ascertaining the said aggregate net profits of the
company;

(b)where the company came into existence in the last but one,
or in the last, of the said accounting years, the references in
this subsection to the said accounting years shall be con-
strued as references to the last 2 or the last, of those years,
as the case may be.

(3) The assets of the company which are deemed to be
included in the property passing on the death of the deceased by
virtue of this section shall include any assets thereof which have been
disposed of or distributed by the company at any time between the
beginning of the first of the accounting years aforesaid and the death
of the deceased, either-

(a)in or towards satisfaction of rights attaching to shares in or
debentures of the company., or

(b)otherwise howsoever except as follows, that is to say, by
way of sale for full consideration in money or money's
worth received by the company for its own use and benefit,
or in or towards discharge of taxes or rates or other





liability imposed by or under any enactment, or in or
towards discharge of a fine or penalty or of a liability for
tort incurred without collusion with the injured party,

including assets which have been so disposed of or distributed in a
winding-up, whether continuing at or completed before the death:

Provided that this subsection shall not apply to assets disposed
of or distributed by way of payments of dividends of amounts not
exceeding in the aggregate, as respects payments made in any
accounting year or in the period between the end of the last
accounting year and the death of the deceased, the amount of the
profits of the company for that year or period.
(4) The provisions contained in the Seventeenth Schedule
shall have effect for the purpose of supplementing and interpreting
this section, section 34 and sections 36 to 45 inclusive.
(Added, 1 of 1959, s. 10. Amended, 47 ol'1962, s. 11; 24 ol'
1967, s. 3; 37 of 1970, s. 3: 27 oj'1972, s. 4; 24 qf1974, s. 3; 31
ol* 1976, s. 4; 31 of 1977, s. 4.. 33 of 1980, s. 3; 29 of 1981, s. 6
and 28 of'1982, s. 5)

36. The following shall be treated as benefits accruing to the
deceased from the company, that is to say-

(a)any profits of the company, and any periodical payment
out of the resources or at the expense of the company,
which the deceased received for his own benefit whether
directly or indirectly, and any enjoyment in specie of land
or other property of the company or of a right thereover
which the deceased had for his own benefit whether direc-
tly or indirectly;

(b)any such profits or payment or enjoyment which the
deceased was entitled to receive or have as aforesaid; and

(c)any such profits or payment or enjoyment which the
deceased could have become entitled to receive or have as
aforesaid by an exercise in the 3 years ending with his death
of any power exercisable by him or with his consent,

and where the deceased could, by an exercise in the said 3 years of
any such power as aforesaid, have become entitled to receive as
aforesaid any payment out of the resources or at the expense of the
company not being a periodical payment, but did not in fact receive
or become entitled to receive that payment, there shall be treated as
a benefit accruing to the deceased from the company interest on that
payment at the average rate from the earliest date on which he could
have become entitled to receive it.
(Added, 1 of 1959, s. 10)

37. (1) Subject to the provisions of subsection (3), if the
deceased has made, whether for value or not, a surrender of his title
to receive any such profit or payment or enjoyment as is mentioned
in section 36, or of any such power as is therein mentioned, section
36 shall have effect as if the surrender had not been made.





(2) The deceased shall be deemed to have made such a
surrender as aforesaid if a right which he had to receive any such
profit or payment or enjoyment as aforesaid, or if any such power as
aforesaid, has been extinguished or suspended by the effect solely or
partly of any disposition made by him or with his consent of shares
in or debentures of a company or of any other property or right, or
of the exercise or the leaving unexercised by him or with his consent of
any power or right, or of the extinguishment or suspension by him or
with his consent of any power or right, otherwise than in a fiduciary
capacity, or if apart from such a disposition or other act or omission
he would have become entitled to receive any such profit or payment
or enjoyment as aforesaid but by the effect solely or partly thereof he
did not become entitled to receive it.

(3) This section shall not apply to a surrender bonafide made
before the beginning of the 3 years ending with the death of the
deceased, or, if it was made for such purposes as are recognized by
the Commissioner as public or charitable, one year before the
beginning of the year ending with his death, if the deceased was at all
times during those 3 years, or during that year, as the case may be,
entirely excluded from receiving, or being entitled to receive, or
having any capacity by an exercise of any power exercisable by him
or with his consent to receive, any periodical payment by virtue of
the surrender or of any associated operations of which the surrender
was one.
(Added, 1 of 1959, s. 10)

38. (1) Ths profits of the company for any accounting year,
or for the period between the end of the last accounting year and the
death of the deceased, hereinafter referred to as the assessable
profits. shall be determined by ascertaining the profits of the
company from all sources, in accordance with the provisions of the
Inland Revenue Ordinance relating to the ascertainment of assess-
ableprofitsa if at-Ordinance applied to profits not arising in or not
derived from same way as it does to profits arising
in or derived fro bject to the modification that such
assessable profits shall be computed by reference to the actual profits
for that year or period, and not by reference to the profits for any
other period:

Provided that-

(a)there shall be excluded from the ascertainment of such
assessable profits any profits which were not bona fide
acquired in the ordinary course of business nor the produce
of income yielding assets; and

(b)in determining such assessable profits no account shall be
taken of sections 19. 19C and 26 of the Inland Revenue
Ordinance. (Replaced, 7 of 1975, s. 43)

(2) The net profits of the company for the purpose of this
Ordinance for any accounting year shall be determined by adding
to the assessable profits for that year computed in accordance with





subsection (1) the amount of any interest on debentures in the
company deduction for which has already been made under the
Inland Revenue Ordinance in assessing the assessable profits of the
company.

(3) The provisions of subsection (1) shall, for a like purpose
and with any necessary adaptations, apply to the determination of
any loss sustained by a company, as it applies to the determination
of the assessable profits of a company.
(Added, 1 of'1959, s. 10)

39. (1) In determining the value of the estate for the purpose
of estate duty the provisions of section 13(1) as to making allowance
for debts and incumbrances shall not have effect as respects any debt
or incumbrance to which assets of the company passing on the death
by virtue of section 35 were liable, but the Commissioner shall make
an allowance from the principal value of those assets for all liabilities
of the company (computed as regards liabilities which have not
matured at the date of death, by reference to the value thereof. at
that date, and, as regards contingent liabilities, by reference to such
estimation as appears to the Commissioner to be reasonable) other
than-

(a)liabilities in respect of shares in or debentures of the
company; and

(b)liabilities incurred otherwise than for the purposes of the
business of the company wholly and exclusively.

(2) In estimating for the purpose of subsection (1), the princi-
pal value of the assets deemed to pass on the death by virtue of
section 35, the Commissioner shall fix the price thereof on the basis
of a sale of the business of the company as a going concern, and the
proportion of that value upon which estate duty is payable by virtue
of section 5 as modified by section 10(b), shall be ascertained by
comparing-

(a)the aggregate value at the date of death of the deceased of
those items of property which together form the assets of
the company other than those situate at that date outside
the-~; with

(b)the aggregate value at that date of those items of property
wheresoever situate, which together form the assets of the
company.

(3) Where the assets passing on the death by virtue of section
35 include any distributed assets, if partial consideration. other than
the extinguishment, or an alteration of rights attaching to shares in
or debentures of a company to which that section applies, was given
for the distribution in money or money's worth received by the
company for its own use and benefit, a further allowance shall be
made, in addition to the allowances specified in subsection (1). of an
amount equal to the value of the consideration given.





(4) For the purpose of the estimation of the principal value of
any distributed assets. section 13(5)(a) shall have effect with the
substitution for the reference therein to the time of the death of the
deceased of a reference to the time of the distribution, and effect
shall be given to the proviso to paragraph (b) of the said subsection
as at the time of the distribution only, due regard being had to the
expectation of life of the deceased at that time.
(Added. 1 of 1959, s. 10)

40. (1) If it is shown to the satisfaction of the Commissioner
that-

the value of all such property as is mentioned in section 35(1) of
which the deceased made a transfer to the company, together
with an amount equal to any excess of interest at the average
rate on the value thereof from the date or respective dates of
transfer to the death of the deceased over the aggregate amount
of the benefits received by the deceased by virtue of the transfer
is less than the value on which estate duty would be chargeable
on the death under section 35 if all benefits accruing to him
from the company other than benefits received by him by virtue
of the transfer were disregarded,

then, an amount equal to the deficiency shall be deducted from the
proportion of the value of the company's assets that corresponds to
the benefits received by him by virtue of the transfer.

(2) References in subsection (1) to benefits received by the
deceased by virtue of a transfer'shall be construed as references to
benefits accruing to him from the company which he received or had
as consideration for the transfer, or in consequence of his having
received as consideration therefor shares or debentures or other
property which produced any of those benefits.

(3) Where the following conditions are satisfied, that is to say.
that the deceased has, within 3 years before his death, disposed of
any shares in or debentures of the company for consideration in
money or money's worth paid to him for his own use or benefit, and
that any benefits accrued to the deceased from the company by
virtue of those shares or debentures or by virtue of a power's having
been exercisable by him or with his consent in relation to those
shares or debentures, then-

(a)if the value of the said consideration or the aggregate value
of the shares or debentures ascertained as if they passed on
the death, whichever is the greater, is equal to or greater
than the proportion of the value of the company's assets
that corresponds to the benefits that so accrued to him, or
if the Commissioner is satisfied that the said proportion
would not. if fully ascertained. be found to be substantially
in excess of that value, duty on the said proportion shall
not be payable;

(b)in any other case, the amount on which duty is to be
charged in respect of the said proportion shall be reduced





by the amount of the value of the said consideration or of
the said aggregate value whichever is the greater:

Provided that-
(i)if estate duty on the death is payable upon such shares or
debentures on their value or any part thereof, or would be
so payable but for an exemption from estate duty, that
value, aggregated if necessary, shall be taken into account
as aforesaid, and in such a case references in this sub-
section to the value of the consideration shall not apply;
and
(ii) in assessing the value of such shares or debentures for the
purposes of this subsection if they have since the deceased
disposed of them, been substantially increased in value
by reason of a transfer of property to any company by
any person, or by reason of the extinguishment of, or
any alteration of the rights attaching to,, shares in or
debentures of any company, their principal value shall be
reduced to such an extent as in the opinion of the Commis-
sioner is necessary to offset the increase attributable to the
transfer, extinguishment or alteration.

(4) Where the following conditions are satisfied, that is to say,
that any benefits accrued to the deceased from the company by
virtue of any interest that he at any time had in shares or in
debentures of the company, or by virtue of a power's having at any
time been exercisable by him or with his consent in relation to shares
in or debentures of the company, and apart from this subsection
estate duty would be payable on the death both on the value of those
shares or debentures by virtue of any provision of this Ordinance
other than section 35 and on the proportion of the value of the
company's assets that corresponds to the benefits that so accrued to
him by virtue of that section, then-

(a)if the value of the shares or debentures is equal to, or
greater than, the said proportion, or if the Commissioner is
satisfied that the said proportion would not, if fully ascer-
tained, be found to be substantially in excess of the value of
the shares or debentures, duty on the said proportion shall
not be payable;

(b)in any other case, the amount on which duty is to be
charged in repect of the said proportion shall be reduced
by the amount of the value of the shares or debentures.

(5) Where the conditions set out in subsection (4) would be
satisfied but for the fact that, by reason of an exemption from estate
duty, not being an exemption on the ground that the deceased or
other person having an interest in the shares or debentures ceasing
on the death of the deceased had only an interest as the holder of an
office, nor being, in the case of a person dying on or after the
commencement of the Estate Duty (Amendment) (No. 2) Ordinance
1979, an exemption conferred by section 10(b), that duty is not





payable on the value of the shares or debentures, paragraphs (a) and
(b) of that subsection shall apply as if that exemption did not operate
and as if the duty had been payable on the value of the shares and
debentures accordingly: (Amended, 44 of 1979, s. 2)

Provided that where-

(a)the exemption in question depends on a payment of any
duty on an earlier death, or does not depend on such a
payment but depends wholly or partly on any dispositions
having been made; and

(b)since the date of that death or disposition, as the case may
be, the shares or debentures have been substantially in-
creased in value by reason of a transfer of property to any
company by any person or by reason of the extinguishment
of, or any alteration of the rights attaching to, shares in or
debentures of any company,

then, unless the exemption takes the form of a deduction from the
value of the shares or debentures of a fixed amount which is
independent of the value of the shares or debentures, the references
in paragraphs (a) and (b) of subsection (4) to the value of the shares
or debentures therein mentioned shall have effect as if they were
references to the value thereof reduced to the extent to which, in the
opinion of the Commissioner, that value is attributable to that
transfer, extinguishment or alteration.

(6) Where, by reason of an exemption from estate duty, that
duty is payable on part only of the value of the shares or debentures,
subsection (4) shall, with the necessary adaptations, be applied to
the part of the value of the shares or debentures on which duty is
payable and subsection (5) shall be applied to the part of the value of
the shares or debentures affected by the exemption; and, where there
are 2 or more exemptions from estate duty each of which operates on
part only of the value of the shares or debentures and the exemp-
tions are such that subsection (5) would operate differently in
relation to them, then, whether or not there is any part of the value
of the shares or debentures on which estate duty is payable,
subsection (5) shall, with the necessary adaptations, be applied
separately in relation to the parts of the value of the shares or
debentures affected by each exemption.

(7) In this section, the expression 'exemption from estate
duty' includes any exemption conferred by any provision of this or
any other enactment which has the effect of exempting property, in
whole or in part, from estate duty, whether that provision takes the
form that the property is not to be deemed to pass, or the form that
the duty is not to be payable, or the form that a deduction is to be
made from the value of the property, or any other form; and the
reference in paragraph (b) of the proviso to subsection (5) to an
increase in the value of shares or debentures includes, where those
shares or debentures have been acquired in substitution for any
other property, any increase in the value of any property which
those shares or debentures directly or indirectly represent.





(8) References in this section to the proportion of the value of
the company's assets that corresponds to any particular benefits shall
be construed as references to so much of the value on which estate
duty is chargeable on the death by virtue of section 35 as is
chargeable by reason of the bringing of those benefits into the
computation made under subsection (2) of that section.

(9) So much of any profit or periodical payment or enjoyment
of a kind mentioned in section 36 as is shown to the satisfaction of
the Commissioner to have represented, or to have been such that it
would if received have represented, reasonable remuneration to the
deceased for any services rendered by him as the holder of an office
under the company shall, notwithstanding anything in that section,
not be treated for the purposes of sections 34 to 45 inclusive, as a
benefit accruing to the deceased from the company; and any liability
of the company in respect of the remuneration of any person as the
holder of an office under the company shall be treated for the
purposes of the aforesaid sections as incurred for the purposes of the
business of the company wholly and exclusively to the extent to
which it is shown to the satisfaction of the Commissioner that the
amount thereof was reasonable, and that extent only.
(Added, 1 of 1959, s. 10)

41. (1) If a company to which section 35 applies was con-
cerned in a transaction falling within the scope of that section. or in
any one or more of associated operations of which that transaction
formed one, the provisions of section 10(a), and of section 40(3).
shall have no effect as respects that transaction or operation.

(2) Where a disposition has been made or an interest deter-
mined or surrendered to which either the proviso to section 6(1)(h).
or section 37(3), applies and, that disposition, determination or
surrender, or one or more associated operations of which that
disposition or determination or surrender formed one. concerned-

(a) a company to which section 35 applies; and

(b)another person being the owner of the beneficial interest
involved,

then the conditions as to the entire exclusion of the person referred
to in paragraph (b) shall not be treated for the purpose of the
aforesaid provisions as having been satisfied if it can be shown that
at the time of the said disposition, determination or surrender, or at
any time thereafter, the said person had any benefit by virtue of that
disposition, determination or surrender.
(Added, 1 of 1959, s. 10)

42. (1) A company to which section 35 applies shall be under
obligation to inform the Commissioner, within one month from the
date of the death of the deceased, of the death, of the fact that the
deceased made a transfer of property to the company, and of the fact
that benefits accrued to the deceased from the company, and every
person who was an officer of the company at that date, or, if the





company has been wound up and dissolved before that date, who
was an officer of the company at any time, shall be under the like
obligation as respects such of the facts aforesaid as are within his
knowledge, unless he knows, or has reasonable cause for believing,
that the information in question has already been given to the
Commissioner by the company or some other person.

(2) If such company or any such person as aforesaid who is
under obligation by virtue of subsection (1) to give any information
to the Commissioner makes default in the performance of that
obligation, every such defaulter shall be liable to a penalty of
$10,000 and shall also be liable to a further penalty equal to 3 times
the amount of the estate duty at the rate set out in the applicable
Schedule payable upon the whole estate of the deceased.
(Added, 1 of 1959, s. 10)

43. (1) The following persons shall be accountable for the
duty payable on the death of the deceased by virtue of section 35,
that is to say-

(a) the company;

(b)any person, other than a bona fide purchaser for full
consideration in money or money's worth received by the
company for its own use and benefit, who receives, whether
directly from the company or otherwise, or disposes of,
any assets which the company had, whether as capital or as
income, at the death or at any time thereafter;

(c)any person who received any distributed assets of the
company on their distribution:

Provided that a person shall not-
(i)by virtue of paragraph (b), be accountable in respect of any
assets for any duty in excess of the value of those assets; or
(ii)by virtue of paragraph (c), be accountable in respect of any
assets for more than a part of the duty bearing to the whole
thereof the same proportion that the value of the distribu-
tion of those assets bears to the principal value of the assets
of the company passing on the death by virtue of section 35
after making the allowances to be made under section 39.

(2) For the purposes of subsection (1), the expressions 'dis-
tributed assets' and---assetsof the company passing on the death'
do not include any distributed assets of the company which the
deceased received on their distribution; and a person who, having
received any distributed assets of the company, has died before the
deceased shall be deemed to have been a person accountable by
virtue of paragraph (c) of that subsection. ~1

(3) Where a company incorporated outsi is
accountable for any duty by virtue of subsection (1) or of this
subsection, every person who is amember of that company at the
death shall also be accountable for a rateable part of that duty in
proportion to the value of his interest in that company.





(4) A person accountable for any duty by virtue of this section
shall, for the purpose of raising and paying the duty, have all the
powers conferred on accountable parties by this Ordinance.

(5) On a winding-up of the company section 265(1) of the
Companies Ordinance (which determines what debts shall have
priority over other debts in a Vinding-up) shall have effect as if there
were included in paragraph (o) of that subsection a reference to any
duty payable in respect of assets of the company passing on a death
by virtue of section 35 of this Ordinance, and section 79 of the
Companies Ordinance shall have effect accordingly.

(6) The duty payable on the death of the deceased by virtue of
section 35 shall be a first charge by way of floating security on the
assets which the company had at the death or has at any time
thereafter, and any part of the duty for which by virtue of subsection
(1)(c.) any person is accountable in respect of any distributed assets
shall be a first charge also on those assets:
Provided that nothing in this subsection shall operate to make
any property chargeable as against a bonafide purchaser thereof
for valuable consideration without notice.
(7) Where any duty has been-

(a) paid by a person accountable therefor by virtue only of
subsection or
(b)raised by virtue of subsection (6) out of any distributed
assets charged therewith,
that person, or, as the case may be, the person who was entitled to
those assets subject to the charge, may, without prejudice to any
right of contribution or indemnity which he may have apart from
this subsection, recover the amount of duty so paid or raised as
aforesaid from any person who is accountable therefor otherwise
than by virtue of subsection (1)(c).
(8) No part of the duty paid by the company shall be recover-
able by it from any person on the ground only that he is entitled to
any interest in, or to any sum charged on, the assets which the
company had at the death of the deceased.
(9) The following provisions shall not have effect in relation to
the duty payable by virtue of section 35. that is to say-
(a)so much of section 12(2) as relates to payment of estate
duty on all property of which the deceased was competent
to dispose at his death;
(b)so much of section 14(6) as relates to the accountability of
the executor of the deceased in respect of all property of
which the deceased was competent to dispose at his death,
and subsection (7) of that section,
and section 18(1) shall have effect in relation to the estate as if the
property passing by virtue of se~4ion 35 had been property, passing
to the executor as such.
(Added, 1 ol'1959, s. 10)





44. (1) Where for the purposes of estate duty there pass
shares in or debentures of a company to which by virtue of section
34 this section applies, then if the deceased had the control of the
company at any time during the 3 years ending with his death, the
principal value of ~Lhe shares or debentures, in lieu of being estimated
in accordance with the provisions of section 13(5)(a), shall be
estimated by reference to the net value of the assets of the company
in accordance k,~ith the provisions of subsection (2) of this section:
Provided that any liability of the company arising, or which may
arise, after the death for corporation profits tax shall be taken into
account as if it were an actual but contingent liability at the date of
the death, in so far as the liability or its amount is referable to profits
accruing before the death, whether then realized or not; and in
estimating any such liability for taxation charged on profits arising
after flie death the Commissioner shall take into account the extent,
if any, to which the last-mentioned profits are likely to be insufficient
to meet the liability.
(2) The principal value of the shares and debentures men-
tioned in subsection (1) shall be estimated as follows-
(a)the net value of the assets of the company shall be taken to
be the principal value thereof estimated in accordance with
the said section 13(5)(a), less the like allowance for liabili-
ties of the company as is provided by section 39(1) in
relation to the assets of a company passing on a death by
virtue of section 35, but subject to the modification that
allowance shall be made for such a liability as is mentioned
in section 39(1)(b) unless it also falls within paragraph (a)
thereof.,
(b)the aggregate value of all the shares and debentures of the
company issued and outstanding at the death of the
deceased shall be taken to be the same as the net value of
the assets of the company;
(e)in a case in which there are both shares in and debentures
of the company issued and outstanding at the death, or
different classes of either, the net value of the assets of the
company shall be apportioned between them with due
regard to the rights attaching thereto respectively; and
(d)the value of any share, or of any debenture. or of a share or
debenture of any class, shall be a rateable proportion,
ascertained by reference to nominal amount, of the net
value of the assets of the company as determined under
paragraph (a). or, in the case mentioned in paragraph (e),
of the part thereof apportioned under that paragraph to
the shares of the company. or to its debentures, or to that
class thereof, as the case may be.
(3) For the purposes of this section, a person shall be deemed-
(a)to have control of a company at any time if he then had the
control of powers of voting on all questions. or on any
particular question. affecting the company as a whole,





which if exercised would have yielded a majority of the
votes capable of being exercised thereon, or if he could
have obtained such control by an exercise at that time of a
power exercisable by him or with his consent; or

(b)to have powers equivalent to control of a company if he
either has the capacity, or could by an exercise of a power
exercisable by him or with his consent obtain the capacity,
to exercise or to control the exercise of any of the following
powers, that is to say, the powers of a board of directors or
of a governing director of the company, power to nominate
a majority of directors or a governing director thereof.
power to veto the appointment of a director thereof, or
pow(4) This section shall not apply to the valuation f 51 res or
CS C
debentures of a class which have been dealt with on ~4rg
S~eek Exchange in the ordinary course of business on that exchange
and such dealings have been recorded during the year ending with
the death of the deceased, and, in making an apportionment under
subsection (2)(c) in the case of a company having shares or deben-
tures of such a class, the part of the value of the assets of the
company to be apportioned to shares or debentures of that class
shall be determined by reference to the prices_ recorded of such
dealings.

(5) Control of a company which a person had in a fiduciary.
capacity shall be disregarded for the purposes of this section but in
the cases dealt with in subsection (7), this section shall apply as if the
deceased had, within 3 years of his death, had control of the
company otherwise than in a fiduciary capacity, but only as to the
valuation of the shares in or debentures of the company as respects
which one of the conditions contained in paragraph (a) or (b) or the
proviso hereto is satisfied, namely-

(a)that immediately after the deceased's death a person having
control or powers equivalent to control of the company.
either alone or in conjunction with his relatives, has a
beneficial interest in possession in the shares or debentures.

(b)that immediately before and after the death the shares or
debentures are held by the trustees of some trust who then
have control of the company by virtue of shares in or
debentures of the company held by them as such trustees.
notwithstanding the fact that such trustees had control in
a fiduciary capacity:

Provided that, in the case of shares or debentures falling to be
valued on the death by virtue of a gift inter i.ii,os made by the
deceased, or by virtue of a disposition or determination, in refation
to which subsection (1)(h) and subsection (2) of section 6 have eFect,
of an interest limited to cease on the death, the above conditions
shall not apply, and the conditions shall be that immediately after
the death or at any previous time since the gift, or since the
disposition or determination, as the case may, be, the donee, or the





person becoming entitled by virtue of or upon the disposition or
determination, has or had control or powers equivalent to control of
the company, either alone or in conjunction with his relatives.

(6) In determining for the purpose of subsection (5), whether a
person at any time has or had control of a company either alone or
in conjunction with his relatives, or a beneficial interest in possession
in any shares in or debentures of a company-

(a)where that person or a relative of his is or was at any time
entitled under a trust, either alone or in conjunction with
that person's relatives, to not less than nine-tenths of
the income arising from any such shares or debentures,
that person or the relative in question, as the case may be,
shall be treated as being or having been able at that time
to control the exercise by the trustees of the trust or
other persons in whom those shares or debentures are or
were vested of any powers attached to those shares or
debentures;

(b)any shares in or debentures of the company, or interests
therein, which form part of a person's estate at his death
shall be treated as vesting immediately on his death in the
legatees or persons entitled on intestacy, without regard to
the powers exercisable for the administration of the estate;

(e)there shall. in so far as the Commissioner so directs. be
disregarded-
(i) any limited interest subsisting at the relevant time in
any shares in or debentures of the company; and
(ii) any voting rights exercisable by virtue of any prefer-
ence shares in the company, being voting rights which the
Commissioner is satisfied do not materially affect the effec-
tive control of the company's affairs.

(7) The cases referred to in subsection (5) as being dealt with
in this subsection are as follows-

(a)if during a continuous period of 2 years falling wholly
within the 3 years ending with his death, the deceased had
powers equivalent to control of the company; or

(b)if during any such period as aforesaid the dividends
declared by the company and the interest accruing due on
debentures of the company as defined in paragraph (c)(ii)
are, as to amounts forming in the aggregate more than
one-half of the total amount of the dividends and interest,
to be treated by virtue of sections 36 and 37 as benefits
accruing to the deceased from the company, or would have
fallen to be so treated if the deceased had made a transfer
of property to the company; or

(e)if at any time during the 3 years ending with the death of
the deceased, not being a time when some other person had
control or powers equivalent to control of the company,





the deceased had a beneficial interest in possession in
shares in or debentures of the company, or in both, of an
aggregate nominal amount representing one-half or more
of the aggregate nominal amount of the shares in and
debentures of the company then outstanding. but for this
purpose-
(i) at any time when both the deceased and another
person had such an interest in the same share or debenture,
the deceased's interest in it shall be treated as extending
only to the same fraction of it as that interest would have
been deemed for purposes of estate duty to extend to if the
share or debenture had passed on his death at that time;
and
(5) the expression 'debenture' shall not include an
obligation of the company in respect of a debt incurred by
it for money borrowed by way of temporary loan, if the
loan was not one of a series of temporary loans by the same
person and either was repaid within 2 years of being made
or was made less than 2 years before the deceased's death.

(8) Where any shares or debentures which fall to be valued in
accordance with this section have also fallen to be so valued on a
previous death within 5 years, then for the purposes of section 31
those shares and debentures shall, in relation to those deaths, be
treated in the same way as an interest in land or in a business not
carried on by a company, if on both deaths their value is wholly or
partly attributable to the value of land of the company or any
subsidiary of it or to the value of assets used by the company or any
subsidiary of it in a business not consisting mainly in the holding of
or dealing in investments other than land:

Provided that the amount on which the reduction under the
said section 31 is to be calculated shall be limited, where necessary,
to the duty on the part so attributable of the value, on which duty is.
payable, of the shares or debentures, and references to that part of
the value shall, in the proviso to the said section 31, be substituted
for the references to the whole value, whether in relation to the first
or the second death.

(9) In determining for the purposes of subsection (8) what part
of the value of any shares in or debentures of a company is
attributable to the value of particular assets,-

(a)the value of the shares or debentures shall be apportioned
in proportion to the net value of the company's assets after
allowing for liabilities other than liabilities in respect of
shares in or debentures of the company; and

(b)the value apportioned under this subsection to the value of
any shares in or debentures of another company, being a
subsidiary either of the first-mentioned company or of a
company of which that company is a subsidiary, shall,
where material, be similarly apportioned between the other
company's assets.





(10) Where a company alters its share capital by sub-dividing
any shares into shares of smaller amount, or by consolidating and
dividing any shares into shares of large amount, subsection (8) shall
apply to shares derived by those means from shares of the same class
which have fallen to be valued in accordance with this section on a
death occurring before the alteration of share capital, as if those
shares and the equivalent amount of the shares from which they
were so derived were the same shares; and if a company has issued to
holders of any shares other shares as fully paid bonus shares, that
subsection shall apply both to the shares in respect of which the issue
was made and to the shares so issued as if they were derived from
the former by sub-division.
(11) In this section-
(a)references to the assets of a company shall be construed as
references to the assets that it had at the death of the
deceased;
(b)references to a subsidiary company shall be construed in
accordance with the interpretation attributed to that ex-
pression in section 34(5)(a); and
(e)the expression 'relative' has the meaning attributed to it in
section 7.
(Added, 1 Qf 7959, s. 10)

45. (1) If a company, to which by virtue of section 34. this
section applies. was concerned in a transaction in relation to which
it is claimed that the provisions of paragraph (a) of or the proviso to
section 7(1) have effect. those provisions shall have effect in relation
thereto if and only if, and to the extent only to which, the Commis-
sioner is satisfied that those provisions would have had effect in the
following circumstances. namely, if the assets of the company had
been held by it on trust for the members thereof and any other person
to whom it is under any liability incurred otherwise than for the
purposes of the business of the company wholly and exclusively. in
accordance with the rights attaching to the shares in and debentures
of the company and the terms on which any such liability was
incurred, and if the company had acted in the capacity of a trustee
only with power to carry on the business of the company and to
employ the assets of the company therein.
(2) Any gifts made in favour of a relative of the deceased by a
company of which the deceased at the time of the gift had control
within the meaning of section 44(3) shall be treated for the purposes
of section 6(])(c) as a gift made by the deceased, and the property
taken under the gift shall be treated as included by virtue of that
paragraph in the property passing on the death of the deceased, if
and to the extent to which the Commissioner is satisfied that it
would fall to be so treated in the circumstances mentioned in
subsection (1).
(3) If the deceased has made in favour of a company to which,
by virtue of section 34, this section applies, a disposition which, if it
had been made in favour of a relative of his. would have fallen





within section 7(1), this section shall have effect in like manner as if
the disposition had been made in favour of a relative of his, unless it
is shown to the satisfaction of the Commissioner that no relative of
the deceased was, at the time of the disposition or subsequently
during the life of the deceased, a member of the company and for the
purposes of this subsection a person who is, or is deemed by virtue of
this provision to be, a member of a company to which this section
applies and which is a member of another such company shall be
deemed to be a member of that other company.

(4) In this section, the expressions 'annuity' and 'relative'
have the meaning attributed to them respectively in section 7.
(Added, 1 of 1959, s. 10)

FIRST SCHEDULE [ss. 3, 5, 14. 16.
17, 23. 24 & 27.1
(Persons dying before 27 February 193 1)

1Amended, 20 of*1948, s. 4)

SECOND SCHEDULE [ss. 3. 5. 14, 16.
17~ 23, 24 & 27.1
(Persons dying on or after 27 February 1931
but before 1 July 1936)

(Amended, 20 of 1948, s. 4)





THIRD SCHEDULE [ss. 3, 5, 14. 16.
17. 23, 24 & 27.]
(Persons dying on or after 1 July 1936
but before 1 April 1941)


FOURTH SCHEDULE [ss. 3, 5, 14, 16,
17, 23, 24 & 27.1
(Persons dying on or after 1 April 1941
but before 1 April 1948)





Estate duty

FIFTH SCHEDULE [ss. 3. 5, 14. 16,
17, 23~ 24 & 27.]
(Persons dying on or after 1 April 1948
and before 1 February 1959)








SIXTH SCHEDULE [ss. 3. 5, 14, 16,
17. 23, 24 & 27.1
(Persons dying on or after 1 February 1959
and before 1 January 1963)


SEVENTH SCHEDULE [ss. 3, 5, 14, 16,
17, 23, 24 & 27.1
(Persons dying on or after 1 January 1963
and before 1 April 1967)






EIGHTH SCHEDULE [ss. 3. 5, 14, 16,
17, 23. 24 & 27.]
(Persons dying on or after 1 April 1967 and
before 1 April 1970)



NINTH SCHEDULE [ss, 1 5~ 14, 16,
17. 23. 24 & 27.1
(Persons dying on or after 1 April 1970 and
before the 1 April 1972)






TENTH SCHEDULE [ss. 3. 5, 14, 16.
17, 23. 24 & 27.1

(Persons dying on or after 1 April 1972
and before 1 April 1974)






TWELFTH SCHEDULE (ss. 3. 5. 14, 16,
17. 23, 24 & 27.1

(Persons dying on or after the commencement of the Estate Duty
(Amendment) Ordinance 1976 and before the commencement
of the Estate Duty (Amendment) Ordinance 1977)

THIRTEENTH SCHEDULE (ss. 3. 5. 14, 16~
IT 23. 24 & 27.1

(Persons dying on or after the commencement of the Estate Duty
(Amendment) Ordinance 1977 and before the commencement
of the Estate Duty (Amendment) Ordinance 1980)





FOURTEENTH SCHEDULE [ss. 3, 5, 14, 16,
17, 23, 24 & 27.1
(Persons dying on or after the commencement of the Estate Duty
(Amendment) Ordinance 1980 and before the commencement
of the Estate Duty (Amendment) Ordinance 1981)

FIFTEENTH SCHEDULE [ss. 3, 5, 14, 16
17, 23, 24 & 27.i
(Persons dying on or after the commencement of the Estate Duty
(Amendment) Ordinance 1981 and before the commencement
of the Estate Duty (Amendment) Ordinance 1982)



SIXTEENTH SCHEDULE [ss. 3, 5, 14, 16,
17, 23. 24 & 27.]
(Persons dying on or after the commencement of the
Estate Duty (Amendment) Ordinance 1983)r-






SEVENTEENTH SCHEDULE [s. 35.]

PROVISIONS SUPPLEMENTSARY TO SECTIONS 34 TO 45 INCLUSIVE

Anmounts to be taken into account in respect of benefits, and
time when benefits are to he treated as accriting

1 . (1) The provisions of this paragraph shall have effect for the purpose of
determining the amounts to be taken into account, for the purposes of section 35(2),
as the amounts of benefits accruing to the deceased from the company.
(2) No amount shall be taken into account more than once.
(3) Where an amount is taken into account by reference to the deceased's
having been entitled to a benefit which he did not in fact receik c. or by reference to a
power which was not in fact exercised or was surrendered, due regard shall be had to
the efrect that his receiving the benefit, or the power's being exercised. would have had
in relation to other benefits.
(4) The amounts that are to be taken into account by reference to the deceased's
haking been entitled to a benefit ks hich he did not in fact receive. or by reference to a
power k& hich was not in fact exercised or kkas surrendered. shall be suc~ as kkould hake
fallen to be taken into account as benefits received bkI the deceased if he had acted in
relation to the claiming to benefits and the exercising of powers during the 3 years
ending with his death to his greatest financial advantage, due regard being had to ans
consijeration which he would have had to give in respect of a claim to any benefit or
the exercise of any power.
(5) In making for the purposes ol' sub-paragraph (4) a computation of ank
diminution of income which the deceased ksould hake Sustained bk giking am suefi
consideration as it therein mentioned. or of any increase of' income which the
company Xk0Uld have obtained from ank such consideration to be izi~ch to the
company. it shall be assumed that the consideration would have \ielded income equal
to interest at the aserage rate on the M110Lint or ~alue thereof.
(6) The amounts to be taken into ~ICCOLint shall include any tax charled under
the Inland Re\enue Ordinance. in respect ofthe benefits in question.
(7) The amount to be taken into account in respect ofa benefit consisting of an\
enjoyment in specie of land or buildings or land and buildings or other property of the
conipany or ol' a right thercok er shall be the kalue of the enjoyment thereof for the
period during which the benefit subsisted and that value shall be calculated in the
case of leasehold property situate in the Colony by reference to the annual assessment
as ascertained for the purposes of section 5 of the Inland Revenue Ordinance. and in
the casc of other land or buildings or land and buildings by such method as the
Commissioner may consider just and reasonable.

2_ ( 1 ) The provisions of this paragraph shall have effect for the purpose of
determining-
(a)A hether a benefit accruing to the deceased from the company is to be treated
as having accrued to him during the 3 years ending with his death, or during
a particular accounting year. or at any other relevant time: and
(b)the period during which a benefit consisting of any enjoyment in specie of
land or buildings or land and buildings or oler propenk of the company or
of a right thereover is to be treated as having subsisted.
(2) A benefit consisting of profits of the company. or a periodical payment
kkhich the deceased received. or became entitled to. but did not in fact. receike. shall
be treated as having accrued to him at the earliest time at which he could have
obtained receipt thereof.
(3) A benefit consisting of profits of the company or a periodical payment
which the deceased could have become entitled to receive by an exercise in the 3 years
ending with his death of a power which was not in fact exercised or was surrenjered
shall years treated as having accrued to him at the earliest time at which he could have
obtained receipt thereof if he had acted as mentioned in paragraph 1(4).
(4) A benefit consisting of interest on such a payment other than a periodical
payment as is mentioned in section 36 which the deceased could have become entitled
to receive shall be treated as having accrued to him in any accounting klear to the
extent to which the period during which the interest is to be treated as accruing fell
within that year.











(5) A benefit consisting of any such enjoyment is specie as aforesaid shall be
treated as having accured to the deceased in the said 3 Years if any part of the period
during which it subsisted fell within those years, and shall be treated as having accrued
to him in any accounting year to the extent to which the period during which it
subsisted fell within that year.
(6) A benefit consisting of any such enjoyment in specie as aforesaid shall be
treated as having subsisted during tfie following period, that is to say-
(a)in the case of enjoyment that the deceased had, during the period for which
he had it;
(b)in the case of enjoyment which he became entitled to, but did not in fact.
have, during the period for which he could have had it,
(e)in the case of enjoyment which he could have become entitled to have by an
exercise in the 3 years ending with his death of a power was not in fact
exercised or was surrendered. during the period for which he could have had
it if he had acted as mentioned in paragraph 1(4).

Adjustments as to Distributed Assets and Addifions to Assets

3. (1) Where the assets of the company passing on the death of the deceased
by virtue of section 35 include any distributed assets. or by reason of the company's
ha~ ing been wound up or dissolved before the death consist of distributed assets. the
following provisions of this paragraph shall have effect.
(2) The net profits of the company shall be determined as if the income of the
company had included, or the company had had income equal to. interest on a sum
equal to the value of such distribution at the average rate from the date thereof.

(3) If on any distribution the deceased received beneficially an interest in any of
the distributed assets, the benefits accruing to i he deceased from the company shall be
ascertained as if the amount brought into the income of the company under sub-
paraeraph (2) by, reference to the value of the distribution of those assets had been
income of the company which the deceased was entitled to receive immediately on its
accrual to the company, or, where the interest in those assets which the deceased
received was less than an absolute interest. had been such income to an extent
corresponding to the proportion which the value of the interest in those assets
received by him bore to the value of those assets.
(4) Where sub-paragraph (3) has effect-
(a)the value on which. apart from this provision, estate duty, would be payable
on the death of the deceased by virtue of section 35 shall be reduced by an
amount equal to the value of the distribution of the assets in question, or.
where the interest in those assets which the deceased received was less than
an absolute interest. by, an amount equal to the proportion of that value~
and
(b)any amount which is treated as a benefit accuring to the deceased from the
company by virtue of that sub-paragraph shall be treated for the purposes
of section 40( 1) and (2) as a benefit received by him.

4. (1) Where the principal value of the assets of the company passing on the
death of the deceased by virtue of section 35 is increased by reason of an addition*s
having been made to the assets of the company. otherwise than by way of profits in
respect of which the company was chargeable to tax under the Inland Revenue
Ordinance, between the beginning of the first of the relevant accounting years and the
death of the deceased, either-
(a) in consideration of an issue of shares in or debentures of the company: or
(b)otherwise howsoever, except by, way of purchase for full consideration in
money or money's worth given by, the company,
the following provisions of this paragraph shall have effect in relation to the added
assets.

(2) The net profits of the company shall be determined as if the income of the
company had included interest on a sum equal to the value of the addition at the
average rate from the beginning of the first of the relevant accounting years to the
date of the addition.





(3) If a transfer of any of the added assets or of any interest in any of them was
made to the company by the deceased, the benefits accruing to the deceased from the
company shall be ascertained as if the amount brough into the income of the company
under sub-paragraph (2) by reference to the value of the addition of those assets had
been income of the company which the deceased was entitled to receive immediately
on its accrual to the company, or had been such income to an extent corresponding to
the proportion which the value of the interest transferred bore to the value of those
assets, as the case may be.
(4) Where sub-paragraph (3) has efrect, if the deceased received as considera-
tion for the addition of the assets in question an interest in any shares in or debentures
of the company in respect of which estate duty would be payable on his death apart
from anything in section 40(3), any amount which is treated as a benefit accruing to
him from the company by virtue of that sub-paragraph shall be treated for the
purposes of section 40(3) as a benefit accruing to him ~v virtue of his interest in those
shares or debentures.
(5) In this paragraph, the expression 'value of the addition- means, in relation
to any added assets, the value thereof or, if partial consideration, other than an issue
of, or an alteration of rights attaching to, shares in or debentures of the company, was
given therefor in money or money's worth out of the resources or at the expense of the
company, the value thereof less the value of the consideration given.

Prevention of duplication qf charge in respect of benelits
and charge in respect ofshares

5. For the purposes of section 40(3). where the benefits that accrued to the
deceased from the company in the relevant accounting years included benefits that
accrued to him otherwise than as mentioned in that subsection. but the deceased had
at any time an interest in, or a power was at any time exercisable in relation to. shares
in or debentures of the company in respect of which estate duty would be payable on
his death apart from anything in that subsection, and by virtue of that interest or
power benefits accrued to the deceased from the company, in those years. or would so
have accrued to him if any payments had been made by virtue of rights attached to
those shares or debentures. then-
(a)if the first-mentioned benefits consisted to any, extent of payments made out
ofnioneys which, if not so applied, could have been applied in increasing the
last-mentioned benefits. or as payments which would have constituted such
benefits; or
(h)if the first-mentioned benefits are brought into the computation made
section 35(2) to the exclusion to any extent of the last-mentioned benefits.

the first-mentioned benefits shall to that extent be treated as if they, had accrued to the
deceased by virtue ofbis interest in, or ofthe power exercisable in relation to, the said
shares or debentures.

Accounting Year

6. (1) The expression 'accounting year' means in relation to a company, if
the company has, before the death of the deceased. made up accounts for a period of
12 months ending in the last year of his life, that period and each previous period of
12 months ending on the date corresponding to that to which the accounts were made
up, or, if not, a period of 12 months ending on such date in the last year of his life as
the Commissioner may determine and each previous period of 12 months ending on
the date corresponding to the date determined.
(2) The expression 'relevant accounting years- means the accounting years by,
reference to which the extent of the passing of the assets of the company, is to be
determined under section 35.
(3) Where an accounting year does not coincide with a perioo for which
accounts of the company were made up. the Commissioner may. for the purpose of
determining the profits or net profits of the company for that accounting year. divide
any such period and make such apportionments and aggregations of the profits of the
company as may be necessary, so, however, that any apportionments so made shall be
made in proportion to the number of months or fractions of months in the respective
periods for which the apportionment is made.





Grant of prior assurances

7. Where at any time a transfer of property, has been made by any person to a
company to which section 35 applies the company may apply to the Commissioner
for an assurance that the provisions of that section will not be applied on the death of
such person by reason only of such transfer and the Commissioner may if he is satisfied
that the transfer and any associated operations were effected bonafide for commercial
reasons and such transfer and any associated operations have not been effected with
the purpose of avoiding estate duty payable upon such death. give such an assurance.
(Added, 1 of 1959, s. 12. Amended, 47 of 1962, s. 14; 24 of 1967, s. 6; 37 of
1970, s. 5; 2~7 of 1972, s. 6.. 24 of 1974, s. 5: 31 of 1976, s. 6; 31 of 1977, s. 6; 33 of
1980, s. 5; 29 of 1981, s. 8 and> of 1982, s. 7)
Originally 3 of 1932. (Cap. 111, 1950.) 32 of 1934. 38 of 1935. 26 of 1936. 7 of 1941. 17 of 1948. 22 of 1950. 24 of 1950. 35 of 1950. 1 of 1959. 47 of 1962. 35 of 1966. 24 of 1967. L.N. 100/68. 29 of 1970. 37 of 1970. L.N. 63/70. 21 of 1972. 27 of 1972. 68 of 1973. 12 of 1974. L.N. 94/74. 24 of 1974. 7 of 1975. 31 of 1976. 31 of 1977. 28 of 1979. 44 of 1979. 33 of 1980. 29 of 1981. L.N. 370/81. 74 of 1981. 79 of 1981. 28 of 1982. L.N. 14/83. Short title. Application. Interpretation. 1894 c. 30, s. 22(1). 1940 c. 29, ss. 44, 47(2) & 59 and 1944 c. 23, s. 36. (Cap. 112.) 1894 c. 30, s. 22(2). 1940 c. 29, s. 45(1) & (2). 1940 c. 29, s. 58(2). 1940 c. 29, s. 58(3). 1940 c. 29, s. 58(4). 1954 c. 44, s. 29(6). 1940 c. 29, s. 58(5). 1940 c. 29, s. 58(6). 1952 c. 33, s. 72(2). Exercise of powers and duties. Appointment as commissioner for oaths. Estate duty. 1894 c. 30, s. 1. Schedules. 1919 c. 32, s. 29. [cf. 1940 c. 48, s. 17.] What property is deemed to pass on death. 1894 c. 30, s. 2(1). 1900 c. 7, s. 11; 1910 c. 8, s. 59. 1940 c. 29, s. 43(2) & 1946 c. 64, s. 47. 1940 c. 29, s. 43(2) & 1946 c. 64, s. 47. 1881 c. 12, s. 38(2); 1889 c. 7, s. 11; 1894 c. 30, s. 2(1) & 1910 c. 8, s. 59. 1940 c. 29, s. 43(2) & 1946 c. 64, s. 47. 1946 c. 64, s. 47. 1939 c. 41, s. 31(2). 1881 c. 12, s. 38(2); 1889 c. 7, s. 11 & 1894 c. 30, s. 2(1). 1881 c. 12, s. 38(2); 1889 c. 7, s. 11 & 1894 c. 30, s. 2(1). 1894 c. 30, s. 2(1). 1939 c. 41, s. 30(1) & (3). 1943 c. 28, s. 26. 1943 c. 28, s. 26. 1862 c. 22, s. 39. 1940 c. 29, s. 43(1) & (2) & 1950 c. 15, s. 43. 1940 c. 29, s. 43(3). 1940 c. 29, s. 43(6). (1 of 1959.) 1894 c. 30, s. 2(3); 1910 c. 8, s. 59. 1946 c. 64, s. 47. 1946 c. 64, s. 47. 1896 c. 28, s. 14. 1896 c. 28, s. 15. Dispositions in favour of relatives. 1950 c. 15, s. 46(1). 1940 c. 29, s. 44(5), & 1950 c. 15, s. 46(2)(a). 1940 c. 29, s. 44(2) & (3). Presumption of simultaneous death. (28 of 1982.) Exemptions. 1944 c. 23, s. 40. 1944 c. 23, 3rd Schd. 1. 1950 c. 15, s. 46(2). 1944 c. 23, 3rd Schd. 3. Accretions to gifts inter vivos. 1957 c. 49, s. 38. Exceptions for transactions for money consideration, property situate outside the Colony, shares on local registers and certain land in the New Territories. [cf. 1894 c. 30, s. 3.] (Cap. 32.) (Cap. 153.) Exception for matrimonial home. Aggregation of property. 1894 c. 30, s. 4. 1939 c. 41, s. 30(2). 1940 c. 29, s. 52. 1940 c. 29, s. 45(3). 1954 c. 44, s. 33. Payment of estate duty; 1894 c. 30, s. 6. mode of payment; provision for unknown values; collection from others than executor; estate includes accrued income; interest payable on estate duty; date when duty shall become due; option to pay by instalments. Value of property; allowance for debts and funeral expenses; exclusion of certain debts, etc., from deduction in valuing for estate duty; 1939 c. 41, s. 31(1). 1943 c. 28, s. 26. limitation on debts deducible from value of estate; 1910 c. 8, s. 57. allowance for local debts only; value of property; 1894 c. 30, s. 7(5). 1910 c. 8, s. 60. interest in expectancy; 1894 c. 30, s. 7(6). benefit arising from cesser of an interest; 1894 c. 30, s. 7(7). ascertainment of value of estate duty; 1894 c. 30, s. 7(8). costs of valuation. 1894 c. 30, s. 7(9). Recovery of estate duty, etc.; (Cap. 336.) sufficient evidence; representation in District Court; (Cap. 87.) service; [cf. Exchequer Rules 1860. r. 3.] power to appoint receiver; 1894 c. 30, s. 8(13). (Cap. 4, sub. leg.) delivery of accounts of property; 1894 c. 30, s. 8(3). Beneficiaries and trustees accountable for estate duty; 1894 c. 30, s. 8(4). executors and surviving joint tenants accountable for estate duty on joint interests; power of inquiry; 1894 c. 30, s. 8(5). application of s.s. (8); 1940 c. 29, s. 57(1). protection of purchaser; 1894 c. 30, s. 8(18). affidavits and accounts to be delivered to the Commissioner; final ascertainment of amount of estate duty; repayment; duty to disclose liability to further estate duty; power to assess estate duty in certain circumstances; payment of estate duty assessed under s.s. (15); power to remit interest on estate duty; penalties for non-compliance with this section. Exemption of executors of small estates. Probate not to be issued until estate duty paid; when value cannot be ascertained immediately; deferred payment; 1894 c. 30, s. 8(9). power to reduce or remit interest. Increase of estate duty when delay in lodging affidavit. Duty of executor as to unregistered shares. Charge of estate duty on property; 1894 c. 30, s. 9. registration of Memorial in Land Office; entry in Land Office; reimbursement of executor; raising estate duty by sale, mortgage or terminate charge; payment by limited owner; payment of duty out of capital money. Apportionment of estate duty; 1894 c. 30, s. 14. disputes; (Cap. 336.) parties bound by accounts as settled. Remission and refunding of estate duty on certain grounds. Proviso regarding war deaths. Remission in case of successive war deaths. Appeal to Supreme Court; postponement of payment of duty; appeal to District Court; no appeal without leave; costs of appeals; interest on excess repaid; payment of duty before appeal may be dispensed with. Schedule of property to be annexed to probate. Penalties for intermeddling. Notification of interest of deceased person in bank or business undertaking. Executor's accounts. Power to reduce penalty and duty. Power to Governor in Council to make rules and prescribe forms, fees and charges. Presumption as to shares standing in the name of the deceased; appeal. Relief in the case of certain settlements. 1894 c. 30, s. 5(2). 1914 c. 10, s. 14. Relief in respect of quick succession where property consists of leasehold property or a business. 1914 c. 10, s. 15. Reduction of full amount of duty where the margin above the limit of value is small. 1914 c. 10, s. 13(1). Relief in the case of certain interests which do not fall into possession. 1894 c. 30, s. 5(3). Controlled companies. 1922 c. 17, s. 21(6). 1936 c. 34, s. 19 and 1940 c. 29, s. 58(1). 1936 c. 34, s. 19(1) (a) & (b). 1936 c. 34. S. 19 (1)(c). 1936 c. 34, s. 20(3). 1936 c. 34, s. 19(2). (Cap. 38.) 1922 c. 17, s. 21(6). 1922 c. 17, s. 21(6). (Cap. 333.) 1936 c. 34, s. 19(3) and 1940 c. 29, s. 58(1)(b)(I). 1936 c. 34, s. 20(7) . (Cap. 155.) 1922 c. 17, s. 21(7). 1940 c. 29, s. 58 (1)(a). Charge on assets of controlled companies; 1940 c. 29, s. 46 and 1946 c. 64, s. 47. proportion of assets accruing to deceased; ascertainment of total assets of controlled companies; Seventeenth Schedule. Benefits from company to deceased. 1940 c. 29, s. 47(1). Surrender of benefits; 1940 c. 29, s. 48. benefits deemed to be surrendered; exemptions. Determination of net profits of company. 1940 c. 29, s. 49. (Cap. 112.) (Cap. 112.) (Cap. 112.) 1944 c. 23, s. 37. Allowances in the valuation of assets; 1940 c. 29, s. 50(1). basis of valuation; 1940 c. 29, s. 50(2). allowance for partial consideration for distributed assets; 1940 c. 29, s. 50(3). valuation of distributed assets. 1940 c. 29, s. 50(4). Limitation on charges; 1940 c. 29, s. 51(1). interpretation; 1940 c. 29, s. 51(1). limitation of value where consideration given; 1950 c. 15, s. 47. 1952 c. 33, s. 72. prevention of double duty; 1944 c. 23, 38. effect of exemptions from duty; 1944 c. 23, s. 38. application of s.s. (4) and (5) with adaptations; 1944 c. 23, s. 38. meaning of exemption; 1944 c. 23, s. 38. value of assets accruing to deceased; 1940 c. 29, s. 51(3). Allowance for reasonable remuneration. 1940 c. 29, s. 51(4). Limitation of exceptions. 1940 c. 29, s. 56(1) & 1950 c. 15, s. 47(b)(ii). 1940 c. 29, s. 56(2) & 1950 c. 15, s. 43(1). Duty to give information on death; 1940 c. 29, s. 53. penalty. Collection and incidence of duty; 1940 c. 29, s. 54. interpretation; foreign corporations; powers of persons accountable; priority of estate duty on winding-up; (Cap. 32.) charge on assets of company; rights of person paying duty; duty not recoverable; accounting and charging. Value of shares and debentures of controlled companies; 1940 c. 29, s. 55 and 1954 c. 44, s. 29(1)(a). 1954 c. 44, s. 30(3). method of estimation; 1940 c. 29, s. 55(2). person deemed to have control of company for purposes of valuation. 1940 c. 29, s. 55(3) and 1954 c. 44, s. 29(1)(b). 1954 c. 44. S. 31(1)(e). quoted shares and debentures; 1940 c. 29, s. 55(4). interpretation of control; 1940 c. 29, s. 55(5). 1954 c. 44, ss. 29(1) & (5) & 31(2). 1954 c. 44, s. 31(2). determination for purposes of s.s. (5); 1954 c. 44, s. 31(3). cases dealt with in this subsection; 1954 c. 44, s. 29(2), (3) & (4). quick succession relief; 1954 c. 44, s. 30(4). determination for purposes of s.s. (8); 1954 c. 44, s. 31(5). alteration of share capital by company; 1954 c. 44 s. 30(5). interpretation. 1940 c. 29, s. 55(6) and 1954 c. 44, s. 31(1)(c) & (d). Limitation on dispositions through a controlled company in favour of relatives; 1950 c. 15, s. 46(1). gifts to relatives by controlled companies. gifts to relatives through controlled companies. 1940 c. 29, s. 44(4). 1940 c. 29, 7th Schedule. (Cap. 112.) (Cap. 112.) (Cap. 112.)

Originally 3 of 1932. (Cap. 111, 1950.) 32 of 1934. 38 of 1935. 26 of 1936. 7 of 1941. 17 of 1948. 22 of 1950. 24 of 1950. 35 of 1950. 1 of 1959. 47 of 1962. 35 of 1966. 24 of 1967. L.N. 100/68. 29 of 1970. 37 of 1970. L.N. 63/70. 21 of 1972. 27 of 1972. 68 of 1973. 12 of 1974. L.N. 94/74. 24 of 1974. 7 of 1975. 31 of 1976. 31 of 1977. 28 of 1979. 44 of 1979. 33 of 1980. 29 of 1981. L.N. 370/81. 74 of 1981. 79 of 1981. 28 of 1982. L.N. 14/83. Short title. Application. Interpretation. 1894 c. 30, s. 22(1). 1940 c. 29, ss. 44, 47(2) & 59 and 1944 c. 23, s. 36. (Cap. 112.) 1894 c. 30, s. 22(2). 1940 c. 29, s. 45(1) & (2). 1940 c. 29, s. 58(2). 1940 c. 29, s. 58(3). 1940 c. 29, s. 58(4). 1954 c. 44, s. 29(6). 1940 c. 29, s. 58(5). 1940 c. 29, s. 58(6). 1952 c. 33, s. 72(2). Exercise of powers and duties. Appointment as commissioner for oaths. Estate duty. 1894 c. 30, s. 1. Schedules. 1919 c. 32, s. 29. [cf. 1940 c. 48, s. 17.] What property is deemed to pass on death. 1894 c. 30, s. 2(1). 1900 c. 7, s. 11; 1910 c. 8, s. 59. 1940 c. 29, s. 43(2) & 1946 c. 64, s. 47. 1940 c. 29, s. 43(2) & 1946 c. 64, s. 47. 1881 c. 12, s. 38(2); 1889 c. 7, s. 11; 1894 c. 30, s. 2(1) & 1910 c. 8, s. 59. 1940 c. 29, s. 43(2) & 1946 c. 64, s. 47. 1946 c. 64, s. 47. 1939 c. 41, s. 31(2). 1881 c. 12, s. 38(2); 1889 c. 7, s. 11 & 1894 c. 30, s. 2(1). 1881 c. 12, s. 38(2); 1889 c. 7, s. 11 & 1894 c. 30, s. 2(1). 1894 c. 30, s. 2(1). 1939 c. 41, s. 30(1) & (3). 1943 c. 28, s. 26. 1943 c. 28, s. 26. 1862 c. 22, s. 39. 1940 c. 29, s. 43(1) & (2) & 1950 c. 15, s. 43. 1940 c. 29, s. 43(3). 1940 c. 29, s. 43(6). (1 of 1959.) 1894 c. 30, s. 2(3); 1910 c. 8, s. 59. 1946 c. 64, s. 47. 1946 c. 64, s. 47. 1896 c. 28, s. 14. 1896 c. 28, s. 15. Dispositions in favour of relatives. 1950 c. 15, s. 46(1). 1940 c. 29, s. 44(5), & 1950 c. 15, s. 46(2)(a). 1940 c. 29, s. 44(2) & (3). Presumption of simultaneous death. (28 of 1982.) Exemptions. 1944 c. 23, s. 40. 1944 c. 23, 3rd Schd. 1. 1950 c. 15, s. 46(2). 1944 c. 23, 3rd Schd. 3. Accretions to gifts inter vivos. 1957 c. 49, s. 38. Exceptions for transactions for money consideration, property situate outside the Colony, shares on local registers and certain land in the New Territories. [cf. 1894 c. 30, s. 3.] (Cap. 32.) (Cap. 153.) Exception for matrimonial home. Aggregation of property. 1894 c. 30, s. 4. 1939 c. 41, s. 30(2). 1940 c. 29, s. 52. 1940 c. 29, s. 45(3). 1954 c. 44, s. 33. Payment of estate duty; 1894 c. 30, s. 6. mode of payment; provision for unknown values; collection from others than executor; estate includes accrued income; interest payable on estate duty; date when duty shall become due; option to pay by instalments. Value of property; allowance for debts and funeral expenses; exclusion of certain debts, etc., from deduction in valuing for estate duty; 1939 c. 41, s. 31(1). 1943 c. 28, s. 26. limitation on debts deducible from value of estate; 1910 c. 8, s. 57. allowance for local debts only; value of property; 1894 c. 30, s. 7(5). 1910 c. 8, s. 60. interest in expectancy; 1894 c. 30, s. 7(6). benefit arising from cesser of an interest; 1894 c. 30, s. 7(7). ascertainment of value of estate duty; 1894 c. 30, s. 7(8). costs of valuation. 1894 c. 30, s. 7(9). Recovery of estate duty, etc.; (Cap. 336.) sufficient evidence; representation in District Court; (Cap. 87.) service; [cf. Exchequer Rules 1860. r. 3.] power to appoint receiver; 1894 c. 30, s. 8(13). (Cap. 4, sub. leg.) delivery of accounts of property; 1894 c. 30, s. 8(3). Beneficiaries and trustees accountable for estate duty; 1894 c. 30, s. 8(4). executors and surviving joint tenants accountable for estate duty on joint interests; power of inquiry; 1894 c. 30, s. 8(5). application of s.s. (8); 1940 c. 29, s. 57(1). protection of purchaser; 1894 c. 30, s. 8(18). affidavits and accounts to be delivered to the Commissioner; final ascertainment of amount of estate duty; repayment; duty to disclose liability to further estate duty; power to assess estate duty in certain circumstances; payment of estate duty assessed under s.s. (15); power to remit interest on estate duty; penalties for non-compliance with this section. Exemption of executors of small estates. Probate not to be issued until estate duty paid; when value cannot be ascertained immediately; deferred payment; 1894 c. 30, s. 8(9). power to reduce or remit interest. Increase of estate duty when delay in lodging affidavit. Duty of executor as to unregistered shares. Charge of estate duty on property; 1894 c. 30, s. 9. registration of Memorial in Land Office; entry in Land Office; reimbursement of executor; raising estate duty by sale, mortgage or terminate charge; payment by limited owner; payment of duty out of capital money. Apportionment of estate duty; 1894 c. 30, s. 14. disputes; (Cap. 336.) parties bound by accounts as settled. Remission and refunding of estate duty on certain grounds. Proviso regarding war deaths. Remission in case of successive war deaths. Appeal to Supreme Court; postponement of payment of duty; appeal to District Court; no appeal without leave; costs of appeals; interest on excess repaid; payment of duty before appeal may be dispensed with. Schedule of property to be annexed to probate. Penalties for intermeddling. Notification of interest of deceased person in bank or business undertaking. Executor's accounts. Power to reduce penalty and duty. Power to Governor in Council to make rules and prescribe forms, fees and charges. Presumption as to shares standing in the name of the deceased; appeal. Relief in the case of certain settlements. 1894 c. 30, s. 5(2). 1914 c. 10, s. 14. Relief in respect of quick succession where property consists of leasehold property or a business. 1914 c. 10, s. 15. Reduction of full amount of duty where the margin above the limit of value is small. 1914 c. 10, s. 13(1). Relief in the case of certain interests which do not fall into possession. 1894 c. 30, s. 5(3). Controlled companies. 1922 c. 17, s. 21(6). 1936 c. 34, s. 19 and 1940 c. 29, s. 58(1). 1936 c. 34, s. 19(1) (a) & (b). 1936 c. 34. S. 19 (1)(c). 1936 c. 34, s. 20(3). 1936 c. 34, s. 19(2). (Cap. 38.) 1922 c. 17, s. 21(6). 1922 c. 17, s. 21(6). (Cap. 333.) 1936 c. 34, s. 19(3) and 1940 c. 29, s. 58(1)(b)(I). 1936 c. 34, s. 20(7) . (Cap. 155.) 1922 c. 17, s. 21(7). 1940 c. 29, s. 58 (1)(a). Charge on assets of controlled companies; 1940 c. 29, s. 46 and 1946 c. 64, s. 47. proportion of assets accruing to deceased; ascertainment of total assets of controlled companies; Seventeenth Schedule. Benefits from company to deceased. 1940 c. 29, s. 47(1). Surrender of benefits; 1940 c. 29, s. 48. benefits deemed to be surrendered; exemptions. Determination of net profits of company. 1940 c. 29, s. 49. (Cap. 112.) (Cap. 112.) (Cap. 112.) 1944 c. 23, s. 37. Allowances in the valuation of assets; 1940 c. 29, s. 50(1). basis of valuation; 1940 c. 29, s. 50(2). allowance for partial consideration for distributed assets; 1940 c. 29, s. 50(3). valuation of distributed assets. 1940 c. 29, s. 50(4). Limitation on charges; 1940 c. 29, s. 51(1). interpretation; 1940 c. 29, s. 51(1). limitation of value where consideration given; 1950 c. 15, s. 47. 1952 c. 33, s. 72. prevention of double duty; 1944 c. 23, 38. effect of exemptions from duty; 1944 c. 23, s. 38. application of s.s. (4) and (5) with adaptations; 1944 c. 23, s. 38. meaning of exemption; 1944 c. 23, s. 38. value of assets accruing to deceased; 1940 c. 29, s. 51(3). Allowance for reasonable remuneration. 1940 c. 29, s. 51(4). Limitation of exceptions. 1940 c. 29, s. 56(1) & 1950 c. 15, s. 47(b)(ii). 1940 c. 29, s. 56(2) & 1950 c. 15, s. 43(1). Duty to give information on death; 1940 c. 29, s. 53. penalty. Collection and incidence of duty; 1940 c. 29, s. 54. interpretation; foreign corporations; powers of persons accountable; priority of estate duty on winding-up; (Cap. 32.) charge on assets of company; rights of person paying duty; duty not recoverable; accounting and charging. Value of shares and debentures of controlled companies; 1940 c. 29, s. 55 and 1954 c. 44, s. 29(1)(a). 1954 c. 44, s. 30(3). method of estimation; 1940 c. 29, s. 55(2). person deemed to have control of company for purposes of valuation. 1940 c. 29, s. 55(3) and 1954 c. 44, s. 29(1)(b). 1954 c. 44. S. 31(1)(e). quoted shares and debentures; 1940 c. 29, s. 55(4). interpretation of control; 1940 c. 29, s. 55(5). 1954 c. 44, ss. 29(1) & (5) & 31(2). 1954 c. 44, s. 31(2). determination for purposes of s.s. (5); 1954 c. 44, s. 31(3). cases dealt with in this subsection; 1954 c. 44, s. 29(2), (3) & (4). quick succession relief; 1954 c. 44, s. 30(4). determination for purposes of s.s. (8); 1954 c. 44, s. 31(5). alteration of share capital by company; 1954 c. 44 s. 30(5). interpretation. 1940 c. 29, s. 55(6) and 1954 c. 44, s. 31(1)(c) & (d). Limitation on dispositions through a controlled company in favour of relatives; 1950 c. 15, s. 46(1). gifts to relatives by controlled companies. gifts to relatives through controlled companies. 1940 c. 29, s. 44(4). 1940 c. 29, 7th Schedule. (Cap. 112.) (Cap. 112.) (Cap. 112.)

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