Hong Kong tax landscape 2026: everything you need to know, in one page

Last reviewed: November 2026 · Reviewed by Stéphane Gombauld, tax expert, technologist and digital nomad

You are considering Hong Kong as a base for your remote work, your company or your investments, and you want the full tax picture before you commit. This page gives you the whole system in one read: how residence and source work, every main tax with its 2026 rate, what changes when you move in or out, and where to go deeper.

Hong Kong taxes in 2026: the key figures

Is this guide for you?

Read on if you…

• want a complete but readable map of Hong Kong taxation before a move or a company setup;
• earn from several countries and need to know what Hong Kong will and will not tax;
• are comparing Hong Kong with Singapore, Thailand or Malaysia as an Asian base.

Probably not your case if you…

• need the exact filing procedure for one return (the linked guides below go deeper on each topic);
• only hold Hong Kong-listed shares from abroad and never set foot there (you have no Hong Kong tax).

How does the Hong Kong tax system work?

Territorial, not worldwide

The Inland Revenue Ordinance (Cap. 112) charges tax on income arising in or derived from Hong Kong. That single sentence shapes everything. Your overseas salary for work done abroad, your foreign rental income, your dividends from anywhere and your capital gains are outside the net. The Inland Revenue Department (IRD) tests source: where the work was done, not where the money is paid.

Residence matters less than you think

Hong Kong has no general definition of tax residence for domestic purposes. The concept appears mainly in double tax agreements, where an individual is resident if they ordinarily reside in Hong Kong or stay more than 180 days in a year of assessment, or more than 300 days over two consecutive years. You need that status for a certificate of resident status and treaty relief, not to be taxed. Details are in obtaining your tax residency in Hong Kong.

Three schedular taxes

Hong Kong has no single "income tax". Instead there are three separate taxes:

1. Salaries tax on employment income, office holders' fees and pensions.
2. Profits tax on business profits of companies, sole proprietors and partnerships.
3. Property tax on rental income from Hong Kong real estate.

Individuals can elect personal assessment, which pools all three and applies allowances and progressive rates to the total. For most freelancers, it saves money.

The tax year and filing

The year of assessment runs from 1 April to 31 March. Individual returns (form BIR60) are issued in early May and are normally due within one month, with an extra month for e-filing. Tax is paid in two instalments, usually January and April, and includes provisional tax for the following year based on the current year's figures.

What are the main taxes and their 2026 rates?

Salaries tax

Net chargeable income (income minus deductions and allowances) is taxed at 2% on the first HKD 50,000, 6% on the next HKD 50,000, 10% on the next, 14% on the next, and 17% on the remainder. Alternatively, the standard rate of 15% applies to net income before allowances (16% on the portion above HKD 5 million). You pay the lower of the two computations. The basic allowance is HKD 132,000 (HKD 264,000 for a married couple). Recent Budgets have granted a one-off 100% reduction capped at HKD 1,500. See personal income tax in Hong Kong and personal tax deductions and benefits.

Social security

Hong Kong has no social insurance in the European sense. The Mandatory Provident Fund (MPF) is compulsory retirement saving: employees and employers each contribute 5% of relevant income, capped at HKD 1,500 a month each. Self-employed persons contribute 5% of relevant income up to the same cap.

Capital gains

Hong Kong has no capital gains tax. Gains on shares, funds, property and crypto are tax-free unless the IRD can show you are trading, in which case the gains are business profits. See capital gains tax in Hong Kong and cryptocurrency taxes in Hong Kong.

Corporate profits tax

Companies pay 8.25% on the first HKD 2 million of assessable profits and 16.5% on the rest under the two-tiered regime; only one entity per group gets the lower band. Offshore-sourced profits are not taxed, though multinational groups must meet economic substance rules under the foreign-sourced income exemption regime. Since 1 January 2025 Hong Kong also applies the OECD 15% global minimum tax to groups with revenue of EUR 750 million or more. See corporate income tax in Hong Kong.

VAT, stamp duty and other taxes

There is no VAT or GST. The main indirect taxes are stamp duty on property transactions and share transfers (0.1% per side on Hong Kong stock), a 15% property tax on rental income, a 3% hotel accommodation tax, betting duty and duties on tobacco, liquor and fuel. See specific taxes in Hong Kong.

Wealth, inheritance and gifts

None. Estate duty was abolished for deaths on or after 11 February 2006. There is no gift tax and no wealth tax.

Are there special regimes for newcomers?

Hong Kong does not run an expat tax regime; the territorial system does the work. Three rules matter most for people arriving:

• The 60-day rule: employment income is exempt if you render services in Hong Kong only during visits of 60 days or less in the year.
• Time apportionment: holders of a non-Hong Kong employment are taxed only on days worked in Hong Kong.
• Housing benefit: employer-provided accommodation is taxed at a notional 10% of other income rather than actual rent.

Visa routes are the Top Talent Pass Scheme, Quality Migrant Admission Scheme and General Employment Policy; there is no digital nomad visa. Details in tax incentives for expats and digital nomads in Hong Kong.

What happens when you move in or move out?

Moving in. Your employer reports you to the IRD when you start (form IR56E). If you are self-employed, you must notify the IRD of chargeability within four months of the end of your first year of assessment. Register for MPF within 60 days of starting self-employment or employment. Keep a day count from your first arrival: it determines treaty residence and, for the first year, any time apportionment.

Moving out. Hong Kong has no exit tax. Your employer must file an IR56G at least one month before you leave and withhold your final pay until you obtain tax clearance from the IRD. You file a final return, pay what is due and may claim a refund of overpaid provisional tax. Both sides are covered in ceasing your tax residency in Hong Kong.

Treaty relief is available with about 50 partner jurisdictions, including Mainland China, the UK, France, Japan and Canada, but not the United States. See tax treaties of Hong Kong.

How does running a business work tax-wise?

A private company limited by shares can be incorporated online with the Companies Registry in about a day, with no minimum capital beyond HKD 1 and a mandatory local company secretary and registered address. Sole proprietors register with the IRD's Business Registration Office within one month of starting. Compare structures in legal forms of business in Hong Kong.

Expenses incurred in producing chargeable profits are deductible, with generous capital allowances: a 60% initial allowance on plant and machinery and 100% immediate write-off for computer hardware, software and environmental facilities. Losses carry forward indefinitely. See business expenses in Hong Kong.

Compliance is strict. Wilful evasion carries a fine of HKD 50,000, treble tax and up to three years in prison; the IRD can reopen six years, or ten for fraud. See tax fraud regulations of Hong Kong.

Common mistakes (and what they cost)

• Assuming "offshore" means foreign clients → profits from work performed in Hong Kong are taxable regardless of where the client sits; back tax for six years plus penalties.
• Forgetting provisional tax → your first bill includes next year's estimate, roughly doubling the cheque; plan the cash.
• Skipping the IR56G before departure → final salary is frozen and the IRD can issue a departure prevention direction.
• Treating active crypto or share trading as investment → frequent trading is business profit taxed at up to 16.5%, with no capital gains shield.
• Ignoring your home country → Hong Kong's low tax does not end your previous residency; you must cease it formally to avoid double exposure.

Frequently asked questions

Is Hong Kong tax-free for foreigners?

No, but it is low. Foreigners pay salaries tax on Hong Kong-sourced employment income at 2% to 17%, capped at the 15% standard rate, and profits tax on Hong Kong-sourced business profits. Foreign income, dividends and capital gains are not taxed. Visitors working in Hong Kong for 60 days or less in a year pay no salaries tax.

Does Hong Kong tax worldwide income?

No. Hong Kong uses a territorial system: only income arising in or derived from Hong Kong is chargeable. This applies to residents and non-residents alike. The main exceptions are a Hong Kong-located employment, where the whole salary is taxable, and multinational groups subject to the foreign-sourced income exemption regime and the 15% global minimum tax.

What is the tax year in Hong Kong?

The year of assessment runs from 1 April to 31 March. Year of assessment 2026/27 covers 1 April 2026 to 31 March 2027. Individual returns are issued in early May after the year ends, and tax is paid in two instalments, typically in January and April of the following year, together with provisional tax for the next year.

Is there VAT or sales tax in Hong Kong?

No. Hong Kong has no VAT, GST or general sales tax. Indirect revenue comes from stamp duty on property and share transactions, duties on tobacco, liquor, hydrocarbon oil and methyl alcohol, betting duty and a hotel accommodation tax of 3%. Prices in shops are the prices you pay.

How much is corporate tax in Hong Kong in 2026?

Under the two-tiered profits tax regime, a company pays 8.25% on its first HKD 2 million of assessable profits and 16.5% on the remainder. Unincorporated businesses pay 7.5% and 15%. Only one entity within a group may claim the lower band. Offshore-sourced profits are generally exempt, subject to substance rules for multinational groups.

Is Hong Kong better than Singapore for tax?

For individuals, Hong Kong's 15% cap beats Singapore's 24% top rate, and neither taxes capital gains or foreign dividends for individuals. For companies the headline rates are close (16.5% versus 17%), with Singapore offering more targeted incentives and Hong Kong a simpler territorial test. Compare in Singapore's overview.

Hong Kong tax guides

• Obtaining your tax residency in Hong Kong – the 180-day and 300-day tests, certificates of resident status and your first return.
• Ceasing your tax residency in Hong Kong – IR56G, tax clearance, final return and provisional tax refunds.
• Tax incentives for expats and digital nomads in Hong Kong – the 60-day rule, time apportionment and visa routes.
• Personal income tax in Hong Kong – salaries tax bands, the standard rate cap and personal assessment.
• Personal tax deductions and benefits of Hong Kong – allowances, MPF, rent, home loan interest and self-education caps.
• Capital gains tax in Hong Kong – why there is none and when trading becomes taxable.
• Cryptocurrency taxes in Hong Kong – investor versus trader, staking, NFTs and record-keeping.
• Specific taxes in Hong Kong – stamp duty, property tax, hotel tax, excise duties and rates.
• Legal forms of business in Hong Kong – sole proprietorship, partnership and limited company compared.
• Business expenses in Hong Kong – deductible costs, capital allowances and loss carry-forward.
• Corporate income tax in Hong Kong – two-tiered rates, offshore claims, FSIE and the global minimum tax.
• Tax treaties of Hong Kong – treaty network, residence tie-breakers and the 183-day rule.
• Tax fraud regulations of Hong Kong – offences, penalties, time limits and voluntary disclosure.
• Tax landscape overview of Hong Kong – this page.

Related guides

• Tax landscape overview of Singapore – Hong Kong's closest competitor as an Asian base.
• Your tax guide to Thailand – remittance rules and the nomad-friendly visa.
• Tax landscape overview of Malaysia – another territorial system in the region.
• Corporate income tax in Hong Kong – start here if you are setting up a company.
• All country tax guides

Sources

• Inland Revenue Department of the HKSAR
• Inland Revenue Ordinance (Cap. 112), Hong Kong e-Legislation
• GovHK – Taxes and duties
• Mandatory Provident Fund Schemes Authority
• Companies Registry of the HKSAR
• The 2026-27 Budget, Government of the HKSAR
• OECD – Global minimum tax (Pillar Two)

This guide is general information, not personalised tax advice. See how we research and review.