From April 1, 2018 the corporate profits tax rate lowered to 8.25 percent for the first HKD 2m (USD 255,000) of profits. Profits above this amount continue to be subject to a tax at a rate of 16.5 percent. For unincorporated businesses (partnerships and sole proprietorships), the two-tiered tax rates are set at 7.5 percent and 15 percent, respectively. To ensure the tax benefits reach small and medium enterprises, the two-tiered rates may be restricted to only one enterprise nominated among connected entities. The Inland Revenue says the new regime will see annual savings of up to HKD 165,000 for corporations and HKD 150,000 for unincorporated businesses.