Hong Kong Tax Rates

Hong Kong Tax Rates

Hong Kong Tax Rates

Profits Tax

Rates of tax 2012/2013 2011/2012
Companies 16.5% 16.5%
Unincorporated businesses 15% 15%

Salaries Tax

Rates of tax 2012/2013 2011/2012
First HK$40,000 2% First HK$40,000 2%
Next HK$40,000 7% Next HK$40,000 7%
Next HK$40,000 12% Next HK$40,000 12%
On the remainder 17% On the remainder 17%
Standard rate 15% Standard rate 15%
Personal allowances 2012/2013 2011/2012
Basic allowance HK$120,000 HK$108,000
Married person’s allowance HK$240,000 HK$216,000
Child allowance
1st to 9th child (each)
 Year of birth HK$126,000 HK$120,000
 Other years HK$63,000 HK$60,000
Dependent parent /  grandparent allowance
Aged 60 or above
 not residing with taxpayer HK$38,000 HK$36,000
 residing with taxpayer throughout the year HK$76,000 HK$72,000
Aged 55 to 59
 not residing with taxpayer HK$19,000 HK$18,000
 residing with taxpayer throughout the year HK$38,000 HK$36,000
Dependent brother / sister allowance (for whom no child allowance claimed) HK$33,000 HK$30,000
Single parent allowance HK$120,000 HK$108,000
Disabled dependant allowance (in addition to any allowances already granted for the disabled person) HK$66,000 HK$60,000
Deductions (maximum deduction for amount paid for): 2012/2013 2011/2012
Self-education expenses HK$60,000 HK$60,000
Home loan interest HK$100,000 HK$100,000
Elderly residential care expenses HK$76,000 HK$72,000
Contributions to recognised retirement schemes HK$15,000 HK$12,000
Charitable donations 35% of assessable income 35% of assessable income

Property Tax

Basis of taxation

Property tax is charged on the owner of any land or buildings in Hong Kong at the standard rate (15%) on the net assessable value of such land or buildings.

Stamp Duty

Immovable property: conveyance on sale

Rates of duty on property consideration 2012/2013 2011/2012
Up to HK$2,000,000 HK$100 HK$100
HK$2,000,001 – $3,000,000 1.50% 1.50%
HK$3,000,001 – $4,000,000 2.25% 2.25%
HK$4,000,001 – $6,000,000 3.00% 3.00%
HK$6,000,001 – $20,000,000 3.75% 3.75%
HK$20,000,001 and above 4.25% 4.25%

Marginal relief is available upon entry into each higher rate band.  Where a conveyance on sale of a residential property is executed in conformity with a chargeable agreement for sale of that property and the agreement for sale is duly stamped, the conveyance on sale is chargeable with stamp duty of HK$100.

Conveyances on sale should be submitted for stamping within 30 days after execution.

Agreement for sale of residential property

The duty rates for agreement for sale of residential property are the same as those for conveyance on sale of immovable property as specified above.  Chargeable agreements should be submitted for stamping within 30 days after execution.  Before 30 June 2011, for properties valued at HK$20 million or below, payment of stamp duty may be deferred until the assignment is executed in conformity with the agreement or the date of re-sale of the property.  The maximum period of deferral is three years after the execution of the agreement.  However, such deferral has been cancelled effective from 30 June 2011.

Special Stamp Duty on disposal of residential property

Effective from 20 November 2010, there is a Special Stamp Duty (“SSD”) on resale of residential property within 24 months from the date of acquisition.  The SSD is imposed on top of the ad valorem stamp duty payable on conveyance on sale or agreement for sale of residential property with a few exemptions.  The SSD payable will be calculated based on the stated consideration or the market value (whichever is higher) of the resold property at the regressive rates indicated below.  The legislation introducing the SSD was enacted on 30 June 2011 with retrospective effect from 20 November 2010.

Holding period Duty rate
For residential properties held for six months or less 15%
For residential properties held for more than six months but for 12 months or less 10%
For residential properties held for more than 12 months but for 24 months or less 5%

Lease of immovable property in Hong Kong

For leases, stamp duty is calculated at a specified rate of the annual rental that varies with the term of the lease as indicated in the following table:

Lease period 2012/2013 2011/2012
Where the lease term is not defined or is uncertain 0.25% 0.25%
Not more than one year 0.25% 0.25%
More than one year but does not exceed three years 0.50% 0.50%
More than three years 1.00% 1.00%

Hong Kong stock

The rate of stamp duty on stock transactions is 0.2% (HK$2 per HK$1,000) per transaction.

Hong Kong bearer instrument

Duty of 3% of the market value is charged for any Hong Kong bearer instrument issued in respect of any stock.