Hong Kong offers a choice: progressive rates 2-17% or a standard rate (15% on first HK$5M net income, 16% above)—IRD calculates both and charges you the lower amount. At typical salary levels the progressive rates are always lower. Only Hong Kong-sourced income is taxed (territorial system)—foreign income is completely tax-free. MPF (Mandatory Provident Fund) adds 5% employee contribution (capped at HK$1,500/month = HK$18,000/year, tax-deductible). A HK$600,000 earner (~$77,000 USD at about 7.8 HKD per USD) pays roughly HK$56,290 salaries tax (9.38% effective) plus HK$18,000 MPF (single, basic allowance of HK$145,000 for 2026/27 only). No capital gains tax, no VAT, no inheritance tax. Hong Kong's tax year runs April 1–March 31. Filing deadline is typically June. Use our calculator to estimate your Hong Kong tax liability.
Note: These are marginal rates — you only pay the higher rate on income within each bracket.
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Hong Kong calculates your tax both ways: progressive rates (2-17% across 5 bands of HK$50,000 each) and a two-tiered standard rate (15% on first HK$5M of net income, 16% on the remainder). IRD automatically charges you whichever is lower. For most employees earning under HK$2M, the progressive system is cheaper. Very high earners (above roughly HK$2.15M of salary) benefit from the standard rate cap. This dual system is unique globally. The standard rate changed from flat 15% to two-tiered 15%/16% effective from 2025/26.
Hong Kong only taxes income earned in or derived from Hong Kong. Foreign-source income—dividends from overseas investments, rental income from property abroad, remote work for non-HK employers—is completely tax-free even if remitted to Hong Kong. This makes it attractive for international investors and remote workers.
MPF (Mandatory Provident Fund) is Hong Kong's retirement savings scheme. Employees contribute 5% of salary, matched by 5% employer contribution. Both are capped at HK$1,500/month each (on salary up to HK$30,000/month). MPF contributions are tax-deductible. Funds locked until age 65 or permanent departure from HK.
Hong Kong has no capital gains tax, no VAT/GST/sales tax, no inheritance/estate tax, no withholding tax on dividends, and no tax on interest income for individuals. Property transactions face stamp duty (up to 15% for non-permanent residents), and property owners pay rates (government rent). This simple system attracts wealth.
Hong Kong's tax year runs April 1-March 31. IRD issues tax returns in May. Filing deadline is typically 1 month from issue (June for paper, July for e-filing). Employers submit employer's returns by May. Provisional tax is charged based on prior year—you can apply for holdover if income dropped significantly.
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Last Updated: October 2026