How far back can the Hong Kong IRD audit my company?
The IRD's field audit and investigation normally cover the 6 years of assessment before the year the investigation starts. Where there is fraud or wilful evasion, it extends to 10 years. Ordinary additional assessments are generally limited to 6 years after the year of assessment ends.
Field audit. The IRD checks that returns and accounts are correct, often by examining books and records on site. Where it finds underpaid tax, it can raise additional assessments under section 60 of the Ordinance and consider penalties.
Look-back period (IRD practice). According to the IRD's practice note on field audit and investigation:
- An investigation of suspected evasion normally covers the 6 years of assessment prior to the year in which it begins.
- In a case of fraud or wilful evasion, it covers 10 years of assessment.
Statute. Under section 60 the IRD can assess, or raise an additional assessment, within six years after the end of the year of assessment. Where the shortfall is due to fraud or wilful evasion the period is 10 years. The Ordinance also requires business records to be kept for at least 7 years.
Penalties. Additional tax under section 82A can reach three times the tax undercharged; in field audit cases the IRD's policy uses a graded scale depending on how fully and promptly you disclose.
What helps
- Keep complete business records (at least 7 years).
- Respond to the IRD's requests on time and through your tax representative.
- If you find a mistake, tell the IRD promptly; prompt, full disclosure is treated more favourably.
An audit by the IRD is separate from the statutory audit of your accounts.
Legal basis
- Inland Revenue Ordinance (Cap. 112), s.60
- Inland Revenue Ordinance (Cap. 112), s.82A
Sources
Applies to YA 2025/26 · Last reviewed 29 October 2026
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
Related questions
- What happens when the IRD questions my offshore profits claim?The IRD assessor has power to ask for full information on any matter affecting tax liability, including detailed questions about how a transaction was carried out. You should respond with documents, not assertions. If the claim is rejected you can object within one month, and wrongly claiming offshore status can lead to additional tax.
- What is an estimated assessment and what should I do if I receive one?An estimated assessment is a tax charge the IRD raises on its own estimate when a return has not been filed by the due date. Do not ignore it: file the correct return and lodge a written objection within one month of the notice date, and ask to hold over the tax if appropriate.
- When will a new Hong Kong company receive its first profits tax return?The IRD generally issues the first Profits Tax Return about 18 months after the date of incorporation. A first-time recipient has 3 months from issue to file. If you are chargeable to tax and receive nothing, you must notify the IRD in writing within 4 months after the end of the basis period.
- What is the filing deadline for the Hong Kong profits tax return?The due date is printed on page 1 of the return, normally one month from issue. First-time recipients get 3 months, and e-filers under the e-notice get 2 months. Represented taxpayers usually get later dates under the Block Extension Scheme, depending on the accounting year-end.
- How does the Block Extension Scheme work for profits tax returns (N, D and M codes)?With a tax representative, the due date depends on your accounting year-end code. For 2025/26: N code no extension; D code (December) 31 August 2026 on paper, 2 October 2026 if e-filed; M code (1 January to 31 March) 30 November 2026 on paper, 30 December 2026 if e-filed. The D and M dates were later extended from 17 August and 16 November.