Hong Kong SAR applies a territorial tax system. There is no VAT, GST, or sales tax, and capital gains are generally not taxed. Profits tax follows a two-tier regime: corporations are taxed at 8.25% on the first HKD 2 million of assessable profits and 16.5% on the remainder, while unincorporated businesses are taxed at 7.5% and 15% respectively. Resident withholding tax on dividends, interest, and royalties is generally 0/0/0, while non-resident royalties may be subject to withholding at 2.475%-4.95%. OECD 2023 composite effective tax rates are 14.28% (EATR) and 2.01% (EMTR).
Hong Kong SAR Tax Brief
Time of Update 4/02/2026
Hong Kong SAR Corporate Income Tax (CIT)
Hong Kong SAR Withholding Tax (WHT)
Hong Kong SAR Value-Added Tax (VAT)
Hong Kong SAR Capital Gain Tax (CGT)
Hong Kong SAR Effective Tax Rate (ETR)
Composite Effective Marginal Tax Rate:
2.01
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TKEG Expat™ (Test) Hong Kong SAR Corporate Tax Guide
1.
Hong Kong SAR corporate income tax
Hong Kong SAR operates a two-tier profits tax regime. Corporations are taxed at 8.25% on the first HKD 2 million of assessable profits and 16.5% on the remainder. Unincorporated businesses are taxed at 7.5% on the first HKD 2 million and 15% on the remainder. A group of connected entities can nominate only one entity to benefit from the two-tier rates in a year of assessment.
2.
Hong Kong SAR Property tax
Property tax:
Property tax is levied annually on the owners of any land or building (other than government and consular properties) in the Hong Kong Special Administrative Region at a rate of 15% of the net assessable value of such land or building. The net assessable value of a property is the consideration paid by the owner for the use of the land or building less the rates paid by the owner and the 20% notional tax allowance.
Corporate rental income derived from Hong Kong properties is subject to profits tax. A corporation subject to profits tax may apply for exemption from payment of property tax in respect of the property. If no exemption is applied, the property tax paid can be used to offset the profits tax payable by the corporation.
Property tax is levied annually on the owners of any land or building (other than government and consular properties) in the Hong Kong Special Administrative Region at a rate of 15% of the net assessable value of such land or building. The net assessable value of a property is the consideration paid by the owner for the use of the land or building less the rates paid by the owner and the 20% notional tax allowance.
Corporate rental income derived from Hong Kong properties is subject to profits tax. A corporation subject to profits tax may apply for exemption from payment of property tax in respect of the property. If no exemption is applied, the property tax paid can be used to offset the profits tax payable by the corporation.
3.
Value-added tax (VAT)
Hong Kong SAR does not have a VAT, goods and services tax, or sales tax.
4.
Stamp duty
Stamp duty is charged on transfers of Hong Kong stock at 0.2% of the consideration or market value per transaction, whichever is higher. For transfers of immovable property, effective from 11 am on 26 February 2025, ad valorem stamp duty applies at progressive rates ranging from HKD 100 to 4.25%, depending on the property value. For leases of immovable property, stamp duty generally ranges from 0.25% to 1% of annual rent depending on the lease term.
5.
Government rates and rent
Rates are an indirect tax on Hong Kong properties. They are generally charged at 5% of the rateable value, which is the estimated annual rental value assessed at the reference date of 1 October. For domestic tenements, progressive rates apply at 5% on the first HKD 550,000, 8% on the next HKD 250,000, and 12% on the remainder. Government rent is generally charged at 3% of the rateable value and adjusted in line with later changes in that value.
