What TVC Is, and How It Differs From QDAP
Tax Deductible Voluntary Contributions (TVC) and Qualifying Deferred Annuity Policy (QDAP) premiums are the two MPF-related legs of Hong Kong's "tax deduction trio." They share a combined annual deduction cap of HK$60,000 — TVC contributions are counted first, and any remaining balance is used against QDAP premiums. This cap has stood since the 2019/20 tax year and hasn't changed since.
For high earners, TVC is especially valuable because salaries tax in Hong Kong is progressive (2%–17%). If your marginal rate sits at the top 17% bracket, the tax saving is most pronounced:
| Your marginal tax rate | Tax saved on a full HK$60,000 TVC contribution (illustrative) |
|---|---|
| 17% (top marginal rate) | HK$10,200 |
| 14% | HK$8,400 |
| 10% | HK$6,000 |
| 6% | HK$3,600 |
The Step Most People Miss: What Happens After You Contribute
This is the part most TVC tax-saving content skips: money you put into TVC doesn't sit inside your existing employer MPF scheme account. It goes into a separate TVC personal account, where you choose your own trustee and your own fund allocation.
The problem is — many people contribute purely for the tax deduction, treat the job as done once they've contributed, and never revisit the account again. The money just sits in whatever fund was selected by default when the account was opened. The tax saved is real, but if the fund allocation is wrong for you, or never gets adjusted as markets shift, the opportunity cost from poor fund allocation over the long run can quietly outweigh the tax you saved.
This is exactly the gap IPP focuses on: most people can help you "contribute" to TVC — very few will keep actively monitoring the fund allocation inside that TVC account afterwards. IPP offers a continuous MPF investment advisory service that's rare in the market — using technical analysis to keep monitoring your fund allocation, and proactively notifying you when market conditions call for a change, not just processing the contribution and moving on.
The Other Blind Spot: Tax Savings ≠ A Sufficient Retirement
HK$60,000 a year in TVC contributions sounds like a lot, but measured against your overall retirement gap, it may still fall well short. TVC should be treated as one piece of your retirement plan, not the whole plan — the tax saving is a bonus, not the endpoint of retirement planning.
Want to know how big your actual retirement gap is? Use our retirement calculator — enter your age, monthly expenses, MPF balance and other savings, and get your retirement gap in 3 minutes, so you can see how much of the gap your TVC contributions actually cover.
Three Practical Steps for High Earners
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1
Work out your actual marginal tax rate
Check your Notice of Assessment from the Inland Revenue Department to confirm your real marginal rate, so you know how much TVC actually saves you — don't assume an online example applies to your situation.
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2
Actively choose your fund after opening the account — don't leave it blank
Once your TVC personal account is open, check what fund you've been allocated to and whether the risk level actually suits you — don't default to whatever was pre-selected. Use our fund comparison tool to compare return performance across fund categories as a reference.
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3
Review regularly with a licensed advisor — don't treat contributing as the finish line
Markets change, and so does your life stage. Work with a licensed advisor who keeps monitoring your TVC account and your overall MPF allocation, rather than only thinking about it at contribution time.
Sources: Mandatory Provident Fund Schemes Authority (MPFA) official page on "Tax Deductible Voluntary Contributions" (combined TVC/QDAP annual deduction cap of HK$60,000, TVC counted first then QDAP); Inland Revenue Department (IRD) 2025/26 progressive salaries tax rates (2%–17%). The tax-saving figures in this article are illustrative examples based on the above tax bands, not personalised tax or investment advice. Please confirm current figures against MPFA (mpfa.org.hk), IRD (ird.gov.hk) and your own Notice of Assessment. This article is general educational content and does not constitute investment advice. Investments involve risk; past performance is not indicative of future results. Please consult a licensed advisor based on your personal circumstances.