Guide
Hong Kong salaries tax 2025/26: rates, allowances and the HK$3,000 reduction
Hong Kong’s 2025/26 salaries tax bills are going out now. If you searched for Hong Kong salaries tax rates 2025/26, the progressive table and two-tier standard rate are below. To check your own bill you also need income, deductions and allowances. Every figure below is from the Inland Revenue Department (IRD) or GovHK and applies to the 2025/26 year of assessment. Links are at the end.
To run your own numbers, use the Hong Kong Salaries Tax Calculator 2025/26.
Hong Kong salaries tax rates 2025/26 at a glance
Progressive rates (on net chargeable income)
| Net chargeable income | Rate | Tax on band | Cumulative tax |
|---|---|---|---|
| First 50,000 | 2% | 1,000 | 1,000 |
| Next 50,000 | 6% | 3,000 | 4,000 |
| Next 50,000 | 10% | 5,000 | 9,000 |
| Next 50,000 | 14% | 7,000 | 16,000 |
| Remainder | 17% | — | — |
After the first HK$200,000 of net chargeable income (which costs HK$16,000 in tax), every extra dollar is taxed at 17%.
Two-tier standard rate (on net income)
From 2024/25 onwards (including 2025/26):
| Net income | Rate |
|---|---|
| First HK$5,000,000 | 15% |
| Remainder | 16% |
Net income here means assessable income after deductions but before allowances. Tax payable is the lower of progressive tax and standard-rate tax; the IRD applies that automatically.
GovHK puts the 2025/26 crossover for a single person (basic allowance only, ignoring deductions) at about HK$2,022,000 a year, and HK$3,144,000 for a married person whose spouse has no income.
The 2025/26 year runs April to March
A Hong Kong year of assessment runs from 1 April to 31 March. 2025/26 covers income earned from 1 April 2025 to 31 March 2026. Salaries tax applies to income from employment in Hong Kong; if you also worked outside Hong Kong, exemption rules can apply, and the IRD looks at those claims year by year.
How the tax is calculated
- Total income: salary, bonus, commission, allowances.
- Less deductions (MPF mandatory contributions, home loan interest and so on, each with a cap) = net income.
- Less allowances (basic, married person’s, child and so on) = net chargeable income.
- Tax is the lower of: progressive rates on net chargeable income, or the standard rate on net income (before allowances). Then the year’s tax reduction comes off.
2025/26 allowances
| Allowance | HK$ (2025/26) |
|---|---|
| Basic allowance | 132,000 |
| Married person’s allowance | 264,000 |
| Child allowance (1st–9th child, each) | 130,000 |
| Extra for each child born in the year | 130,000 |
| Single parent allowance | 132,000 |
| Dependent parent/grandparent aged 60+ (or eligible for Disability Allowance), each | 50,000 |
| Dependent parent/grandparent aged 55–59, each | 25,000 |
| Additional allowance if living with you (60+ / 55–59), each | 50,000 / 25,000 |
| Dependent brother or sister, each | 37,500 |
| Personal disability allowance | 75,000 |
| Disabled dependant allowance, each | 75,000 |
Source: IRD PAM 61(e), August 2026 edition.
Main deduction caps
| Deduction | 2025/26 cap (HK$) |
|---|---|
| MPF / recognised retirement scheme mandatory contributions | 18,000 |
| Qualifying annuity premiums + tax-deductible MPF voluntary contributions (TVC), combined | 60,000 |
| Self-education expenses | 100,000 |
| Elderly residential care expenses | 100,000 |
| Home loan interest: basic / additional (conditions apply) | 100,000 / 20,000 |
| Domestic rent: basic / additional (conditions apply) | 100,000 / 20,000 |
| VHIS qualifying premiums (per insured person) | 8,000 |
| Assisted reproductive service expenses | 100,000 |
| Approved charitable donations | 35% of income (after allowable expenses and depreciation) |
The additional HK$20,000 for home loan interest or rent is mainly for taxpayers living in Hong Kong with a child born on or after 25 October 2023, and must be elected in writing; see the IRD page linked below. MPF and TVC rules are covered in MPF tax deduction limits in Hong Kong.
The 2025/26 reduction: 100%, capped at HK$3,000
The 2026-27 Budget waived 100% of 2025/26 salaries tax up to HK$3,000 per case; the law was gazetted on 22 May 2026.
- Single people and separately taxed spouses each get up to HK$3,000.
- Married couples under joint assessment share one HK$3,000 cap (see joint vs separate assessment).
- It applies to final tax for 2025/26 only, not to provisional tax.
- The IRD applies it automatically. No application is needed.
Worked examples
All examples assume salary income only, and the arithmetic has been checked.
IRD’s own example (PAM 39). Salary of HK$40,000 a month and MPF of HK$1,500 a month from 1 October 2025: income 240,000 − MPF 9,000 = net income 231,000; − basic allowance 132,000 = net chargeable income 99,000. Progressive tax = 1,000 + 49,000 × 6% = 3,940. Standard rate = 231,000 × 15% = 34,650. The lower is 3,940; after the HK$3,000 reduction, HK$940 is payable.
Single, HK$30,000 a month. Income 360,000 − MPF 18,000 = 342,000; − 132,000 = 210,000. Progressive tax = 16,000 + 10,000 × 17% = 17,700 (standard rate would be 51,300). After the reduction: HK$14,700.
Married, one earner, one child. Income 600,000 − MPF 18,000 = 582,000; allowances 264,000 + 130,000 = 394,000; net chargeable income 188,000. Progressive tax = 9,000 + 38,000 × 14% = 14,320. After the reduction: HK$11,320.
High earner. Single, income 2,500,000, MPF 18,000: net income 2,482,000; progressive tax on 2,350,000 = 381,500; standard rate = 2,482,000 × 15% = 372,300, which is lower. After the reduction: HK$369,300.
Why the bill is bigger than you expect: provisional tax
A salaries tax demand note usually combines the final tax for the past year with provisional tax for the next one. Provisional tax for 2026/27 is normally based on your 2025/26 income (grossed up to 12 months if you worked part of the year), using 2026/27 allowances. In the IRD’s example above, 2026/27 provisional tax is HK$35,890, so the total is HK$36,830, normally paid in two instalments, around January 2027 and around April 2027. Your demand note shows the actual dates. You can apply to hold over provisional tax if, for example, your income drops sharply or you become entitled to a new allowance.
Don’t use the 2026/27 allowances for 2025/26
The same Budget raised allowances from 2026/27 (basic HK$145,000, married person’s HK$290,000, child HK$140,000). Those figures don’t apply to 2025/26 final tax. Mixing the two years understates the bill.
FAQ
What are the Hong Kong salaries tax rates for 2025/26?
Progressive rates on net chargeable income: 2% / 6% / 10% / 14% on successive HK$50,000 bands, then 17% on the remainder. Two-tier standard rate on net income: 15% on the first HK$5,000,000 and 16% on the rest. You pay the lower amount, then less the HK$3,000 reduction (where it applies).
What is the 2025/26 basic allowance?
HK$132,000 for 2025/26. Do not use HK$145,000 — that higher basic allowance applies only from 2026/27.
What is the standard rate for salaries tax in 2025/26?
Two-tiered from 2024/25 onwards: 15% on the first HK$5,000,000 of net income (before allowances) and 16% on the remainder. The IRD charges the lower of progressive and standard-rate tax.
When does the standard rate apply?
When tax at the standard rate on net income is lower than tax at progressive rates on net chargeable income. For 2025/26, a single person (basic allowance only) approaches that zone around HK$2,022,000 a year.
Do I need to apply for the HK$3,000 reduction?
No. The IRD applies the 100% reduction (capped at HK$3,000) automatically in the 2025/26 assessment. No separate application is needed.
Do jointly assessed couples get HK$3,000 each?
No. Under joint assessment the couple shares one HK$3,000 cap. Under separate taxation, each spouse has their own HK$3,000 cap. For when joint assessment can help, see joint vs separate assessment in Hong Kong.
My calculator result differs from my tax bill. Which is right?
The IRD assessment. Calculators only estimate from what you enter. GovHK also has an official tax computation tool.
Sources (checked on 2026-10-12)
- IRD, Allowances, Deductions and Tax Rate Table, PAM 61(e), August 2026: https://www.ird.gov.hk/eng/pdf/pam61e.pdf
- IRD, A guide to Salaries Tax (1), PAM 39(e), May 2026: https://www.ird.gov.hk/eng/pdf/pam39e.pdf
- GovHK, Tax rates of salaries tax & personal assessment: https://www.gov.hk/en/residents/taxes/taxfiling/taxrates/salariesrates.htm
- IRD, 2026-27 Budget tax measures: https://www.ird.gov.hk/eng/tax/budget.htm
- IRD, Increased ceiling for home loan interest and domestic rent deductions: https://www.ird.gov.hk/eng/tax/adc.htm
- GovHK, Tax computation of salaries tax and personal assessment: https://www.gov.hk/en/residents/taxes/etax/services/tax_computation.htm
Try your own figures in the Hong Kong Salaries Tax Calculator 2025/26.
This article is general information, not tax or financial advice. Your IRD assessment is final. See the disclaimer.