Hong Kong Tax Rates
HONG KONG TAX RATES
Hong Kong Tax Rates
i. Personal tax allowances and deductions
Basic allowances Single person’s allowance 120,000 132,000 Married person’s allowance 240,000 264,000 Additional allowances Child Basic 100,000 100,000 Additional (in the year of birth) 100,000 100,000 Dependent parent / grandparent a. Aged 55 to 59 Basic 20,000 23,000 Additional 1 20,000 23,000 b. Aged 60 or above Basic 40,000 46,000 Additional 40,000 46,000 Dependent brother / sister 2 33,000 33,000 Single parent 120,000 120,000 Disabled dependent 66,000 66,000 Additional deductions Self-education expenses 3 80,000 80,000 Home loan interest 4 100,000 100,000 Elderly residential care expenses 80,000 92,000 Contributions to retirement schemes 18,000 18,000 Approved charitable donations 5 35% 35% Notes 1 For dependent living with taxpayer. 2 For whom no child allowance is being claimed. 3 The maximum amount that can be claimed as deductible expense for training courses attended at approved institutions. 4 The entitlement period for tax deduction is 15 years. 5 The maximum deduction allowable is restricted to 35% of the taxpayer’s assessable income after deduction of allowable expenses and depreciation allowance.
ii. Standard salaries tax rates
2015/16 and 2016/17 Standard tax rates 15%
iii. Progressive salaries tax rates
Net Chargeable Income 2015/16 and 2016/17 First HKD 40,000 2% Next HKD 40,000 7% Next HKD 40,000 12% Remainder 17%
Business Category 2015/16 and 2016/17 Unincorporated Business 15% Corporation 16.5%
Taxpayer 2015/16 and 2016/17 Property Owner 15%
i. Shares transactions
Particular 2015/16 and 2016/17 Contract Note for sale or purchase of any Hong Kong stock 0.1% of the amount of the consideration or of its value on every sold note and every bought note Transfer operating as a voluntary disposition inter vivos HKD 5 + 0.2% of the value of the stock Transfer of any other kind HKD 5
ii. Property transactions
Sales Consideration 2015/16 and 2016/17 Up to HKD 2,000,000 1.5% HKD 2,000,001 to HKD 2,176,470 HKD 30,000 + 20% of excess over HKD 2M HKD 2,176,471 to HKD 3,000,000 3% HKD 3,000,001 to HKD 3,290,330 HKD 90,000 + 20% of excess over HKD 3M HKD 3,290,331 to HKD 4,000,000 4.5% HKD 4,000,001 to HKD 4,428,580 HKD 180,000 + 20% of excess over HKD 4M HKD 4,428,581 to HKD 6,000,000 6% HKD 6,000,001 to HKD 6,720,000 HKD 360,000 + 20% of excess over HKD 6M HKD 6,720,001 to HKD 20,000,000 7.5% HKD 20,000,001 to HKD 21,739,130 HKD 1,500,000 + 20% of excess over HKD 20M Exceeding HKD 21,739,130 8.5%
On top of the current ad valorem property transaction stamp duty (maximum at 4.5%), a Special Stamp Duty (“SSD”) is imposed on residential properties of all values at the point of resale if the properties are acquired on or after 20 November 2010 and resold within 24 months after acquisition.
In October 2012, the Government announced to adjust the SSD rates and extend the coverage period to 36 months for any residential properties acquired on or after 27 October 2012. Transactions took place between 20 November 2010 and 26 October 2012 are subject to the original SSD regime.
The prevailing SSD will have three levels of regressive rates for different holding periods:
- 20% if the property has been held for six months or less;
- 15% if the property has been held for more than six months but for 12 months or less; and
- 10% if the property has been held for more than 12 months but for 36 months or less.
In addition to SSD, a Buyer’s Stamp Duty (“BSD”) on residential properties acquired by any person (including a company incorporated) except a Hong Kong Permanent Resident is effected from 27 October 2012. BSD is to be charged at a flat rate of 15% on all residential properties, on top of the existing stamp duty and the special stamp duty, if applicable.
On 22 February 2013, the Financial Secretary announced that the Government would amend the Stamp Duty Ordinance to adjust the ad valorem stamp duty (“AVD”) rates and to advance the charging of AVD on non-residential property transactions from the conveyance on sale to the agreement for sale. Under the Government’s proposed amendments, any residential property (except that acquired by a Hong Kong Permanent Resident who does not own any other residential property in Hong Kong at the time of acquisition) and non-residential property acquired on or after 23 February 2013, either by an individual or a company, will be subject to the new rates of AVD. Transactions which took place before 23 February 2013 will be subject to the original stamp duty regime.
Leasing period 2015/16 and 2016/17 Not defined or is uncertain 0.25% Specified in the lease as not exceeding 1 year 0.25% Exceeding 1 year but not exceeding 3 years 0.5% Exceeding 3 years 1%
The Government had abolished the Estate Duty with effect from 11 February 2006 pursuant to the Revenue (Abolition of Estate Duty) Ordinance 2005.