10. Which expenses/outgoings are NOT deductible from the assessable profits?

Expenses not deductible include (this is not an exhaustive list):

• any loss of capital;
• withdrawals by the sole proprietor/partners;
• any withdrawal of capital;
• any expenditure of a capital nature (e.g. purchase fixed assets);
• the costs of any improvements;
• rent or expenses relating to premises not occupied for the purpose of producing assessable profits;
• any sum recoverable under insurance or contract of indemnity;
• taxes paid under the Inland Revenue Ordinance, except Salaries Tax paid in respect of employees’ remuneration;
• any remuneration or interest on capital or loans payable to:
  for a sole proprietorship - the proprietor or the proprietor's spouse,
  for a partnership - the partners or their spouses;
• domestic or private expenses, including:
  medical expenses, insurance premiums, birthday celebration expenses for the sole proprietor/partners and their family members, etc., and
  costs of travelling between residence and place of business;
• traffic penalty incurred during the delivery of goods to customers (this is a fine for breaking the law);
• any sum not expended for the purpose of producing assessable profits.
• contributions made to a mandatory provident fund scheme in respect of the proprietor (except mandatory contributions) or the proprietor's spouse or, in case of a partnership, to its partners (except mandatory contributions) or their spouses.