SDO s45 Transfer between associated bodies corporate

SDO s45 Transfer between associated bodies corporate is section 45 of Hong Kong Stamp Duty Ordinance Cap.117 (In short, HK SDO). It regulates the Hong Kong Stamp Duty exemption for certain property transfer between associated corporations, (intra group).

HK SDO section 45 exemption does apply to the following transactions:

1. Conveyance on sale of immovable property;
2. Agreement for sale of residential property;
3. Transfer of Hong Kong stock.

Therefore, HK SDO s45 exemption does not apply to leasing transaction.

Associated bodies

The said associated bodies are not same as an associate company as defined in accounting. The associated bodies mentioned in HK SDO mean:

1. One is directly or indirectly the beneficial owner of not less than 90% of the other; or
2. A third party corporate is owner of not less than 90% of the issued share capital of each company. An example is the relationship of a holding company and two subsidiaries.

Once ceased to be associated bodies

HK SDO Section 45(4)(c) states that if the above transferor and the transferee have ceased to be associated due to change in % of the issued share capital of the transferee, HK SDO section 45 also does not apply.

Reference links

• Chapter 117 STAMP DUTY ORDINANCE, Section 45 Transfer between associated body corporate (English)