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What is Qualifying Deferred Annuity Policy
With increasing average life expectancies, it is becoming even more important to consider planning for your retirement. Qualifying Deferred Annuity Policy (QDAP) is an annuity through accumulation to provide stable guaranteed annuity returns and life insurance, but you can also apply for tax deductions on premiums based on your current financial needs, in order to plan for your retirement.
Qualifying Deferred Annuity Policy
The tax saved within each assessment year can be up to HK$10,200 per taxpayer (assuming an applicable tax rate of 17%)
Guaranteed Income
Monthly guaranteed annuity income with a guaranteed internal rate of return 3.02% - 3.30% for 10 years
Earn yuu Points
Earn 1 yuu Point for every HK$1 of your insurance premium paid in the first policy year
Key Features
Monthly guaranteed annuity income with a guaranteed internal rate of return 3.02% - 3.30% for 10 years
Depending on your plan options (5/10/15 years of deferred annuity accumulation period, annual or monthly premium payment mode), the deferred annuity Internal Rate of Return ("IRR") of your monthly guaranteed annuity income could be up to 3.30%. eIncomePro is an ideal deferred annuity plan for retirement, which provides you a stable annuity income after retirement while helping you to achieve your financial goals.
Tax deduction benefit on premiums paid in deferred annuity plan
eIncomePro is a QDAP in Hong Kong. Apply for a total of up to HK$60,000 tax deduction* per assessment year for the qualifying annuity premiums you pay for this QDAP if you are a taxpayer in Hong Kong. The tax saved within each assessment year can be up to HK$10,200 per taxpayer (assuming an applicable tax rate of 17%). A married couple can jointly apply for tax deductions* for the qualifying annuity premiums paid of up to HK$120,000 per each tax assessment year, provided that the couple are both taxpayers having income chargeable to tax, and each QDAP tax deduction claimed by each taxpayer does not exceed the individual limit of HK$60,000.
The breakeven year is at the end of 8th policy year at the earliest
This QDAP offers short breakeven year - the breakeven year is at the end of 8th policy year at the earliest which the Guaranteed Cash Value is more than the Total Premiums Paid. For the details of Guaranteed Cash Value across the policy years, please refer to the Illustration Summary.
Accidental Death Benefit
If the life insured passes away in an accident before the insurance age of 80 while the deferred annuity insurance policy is in force, in addition to the above death benefit, the beneficiary(ies) designated in the policy will receive an accidental death benefit that equals to 100% of the total premiums paid for the basic plan. The above information is intended as a general summary of information for reference only. If you wish to know more about the plan, please read Product Brochure.
Learn more about Hang Seng eIncomePro Deferred Annuity Plan (100% Guaranteed) through the product brochure
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Frequently Asked Questions
What is annuity?
An annuity is a long-term insurance product. The purpose of an annuity is to help policyholders convert their money into a steady stream of income over the long term. It helps policyholders spend their retirement savings in a disciplined way to address the financial risks brought about by longevity. The policyholder pays the premium to an insurance company which will provide regular annuity income to the policyholder immediately or after a designated period of time or after a certain age of the policyholder, for the period specified in the contract.
What is Qualifying Deferred Annuity Policy (QDAP) with tax deduction benefit?
QDAP is a deferred annuity product complying with the guidelines issued by the Insurance Authority (IA) and certified by the IA. Taxpayers are allowed to claim a tax deduction for their qualifying deferred annuity premiums. QDAP must comply with a number of requirement including: the minimum total premiums of HKD180,000, a minimum payment period of 5 years, annuitisation at the age of 50 or above etc. For details, please visit IA’s website.
What is Internal Rate of Return (IRR)?
The Internal Rate of Return is a way to calculate the return. “Internal” means only the relevant cash flows are calculated, including the invested capital (e.g. premiums), withdrawn amounts (e.g. annuity income) and the time factor. External factors (e.g. inflation rate) are not considered.
How is eIncomePro different from other deferred annuity insurance plans in Hong Kong?
The income payout of many deferred annuity products in the market is usually divided into two parts, namely “guaranteed” and “non-guaranteed”. “Non-guaranteed” return is often affected by other factors such as the investment return, claims and profits of the insurance company. In an extreme case, the “non-guaranteed” return could be zero.
On the other hand, the annuity income payout of eIncomePro Deferred Annuity Plan (100% Guaranteed) is 100% guaranteed, without any “non-guaranteed” part.
What is accumulation period?
Accumulation period refers to the period before the start of the annuity period. It includes the premium payment period, which allows the policy value to grow through investment by the insurer.
Remark(s)
*Calculation based on the assumptions that the highest rate of the progressive tax rates applicable to the taxpayer is 17%, which remains the same throughout the premium payment period and the taxpayer has applied one eIncomePro Deferred Annuity Plan (100% Guaranteed) policy only with no tax deductible MPF voluntary contributions nor other QDAP policies during the 5 years premium payment period.
- The QDAP status of this product does not necessarily mean you are eligible for tax deduction available for QDAP premiums paid. This product’s QDAP status is based on the features of the product as well as certification by the IA and not the facts of your own situation. You must also meet all the eligibility requirements set out under the Inland Revenue Ordinance and any guidance issued by the Inland Revenue Department of HKSAR before you can claim these tax deductions. Any general tax information provided is for your reference only, and you should not make any tax-related decisions based on such information alone. Please note that only the premium paid net of any marketing offers (e.g. discount, premium waiver, etc.) might be eligible for tax concession and the actual tax benefits of this Policy would depend on personal tax position (e.g. salaries income and assessable profits) and you should always consult with a professional tax advisor if you have any doubts. Please note that the tax law, regulations or interpretations are subject to change and may affect related tax benefits including the eligibility criteria for tax deduction. We do not take any responsibility to inform you about any changes in the laws and regulations or interpretations, and how they may affect you. Further information on tax concessions applicable to QDAP may be found at www.ia.org.hk. - The IA certification is not a recommendation or endorsement of the policy nor does it guarantee the commercial merits of the policy or its performance. It does not mean the policy is suitable for all policyholders nor is it an endorsement of its suitability for any particular policyholder or class of policyholders. The policy has been certified by the IA but such certification does not imply official recommendation. The IA does not take any responsibility for the contents of this product brochure of the policy, makes no representation as to its accuracy or completeness, expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this product brochure of the policy. - The above information is intended as a general summary of information for reference only. If you wish to know more about the plan, please read the Product Brochure for details. - Please refer to General Provisions (https://www.hangseng.com/content/dam/hase/rwd/personal/insurance-and-mpf/pdfs/eIncomePro_Provision_BasicPlan_Tc_En.pdf) for the exact terms, conditions and exclusions of the Plan. - For procedures for making claims, please visit https://www.hangseng.com/en-hk/personal/insurance-mpf/claims/. - Eligibility • eIncomePro Deferred Annuity Plan (100% Guaranteed) is only available to tax residents of Hong Kong aged between 35-64, Member (the applicant) also needs to possess valid Hong Kong Identity Card and Hang Seng bank account • Premium payment will be debited from Member’s Hang Seng Bank account or credit card account - Other point(s) to note Hang Seng Insurance is a wholly-owned subsidiary of Hang Seng Bank. The yuu Rewards Club (“yuu”) is owned and operated by DFI Development (HK) Limited (“DFI” ), a wholly-owned subsidiary of Dairy Farm International Holdings Limited. Hang Seng Bank and DFI are authorised insurance agents of Hang Seng Insurance and regulated by the Insurance Authority. eIncomePro Deferred Annuity Plan (100% Guaranteed) is a product of and underwritten by Hang Seng Insurance. In respect of an eligible dispute (as defined in the Terms of Reference for the Financial Dispute Resolution Centre in relation to the Financial Dispute Resolution Scheme) arising between Hang Seng Bank and you out of the selling process or processing of the related insurance product transaction, Hang Seng Bank will enter into a Financial Dispute Resolution Scheme process with you; however any dispute over the contractual terms of the insurance products should be resolved between Hang Seng Insurance and you directly. The above information is intended as a general summary of information for reference only. It shall not be construed as an offer to sell or solicitation of an offer or recommendation to purchase or sale or provision of any products of Hang Seng Insurance. Please refer to the actual policy for the exact terms, conditions and exclusions of the relevant insurance plan.
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