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Salaries Tax
Scope of Charge
Hong Kong salaries tax is charged on income arising in or derived from Hong Kong as per regional source.
Assessment Period
From 1 April of one year to 31 March of the next year
Deductions and Allowances
Salaries tax clearly defines deductible items, that deductible portion includes donations from governmentally approved charitable organizations, contributions paid to recognized retirement schemes, self-education expenses, interest on personal home loans and all outgoing expenses incurred in order to fully or necessarily produce the assessable income. The information for tax allowances and tax rates for the year 2012/13 and 2013/14 is listed below:
| Allowances in Computing Salaries Tax (HK$) |
2013/14 * |
2012/13 |
| Basic allowance |
120,000 |
120,000 |
| Married person's allowance |
240,000 |
240,000 |
Child allowance for each of the 1st to 9th child
- born within the year of assessment
- born in other years of assessment |
140,000
70,000 |
126,000
63,000 |
| Allowance for dependent parents, grandparents and grandparents-in-law who are 55 years old or above but below 60 (each) |
19,000 |
19,000 |
| Additional allowance for dependent parents, grandparents, grandparents-in-law who are 55 years old or above but below 60 (dependent family members residing with the taxpayer)(each) |
19,000 |
19,000 |
| Allowance for dependent parents, grandparents and grandparents-in-law who are 60 years old or above, or eligible to claim allowances under the Government’s Disability Allowance Scheme (each) |
38,000 |
38,000 |
| Additional allowance for dependent parents, grandparents and grandparents-in-law who are 60 years old or above, or eligible to claim allowances under the Government’s Disability Allowance Scheme (each) |
38,000 |
38,000 |
| Dependent siblings allowance (each) |
33,000 |
33,000 |
| Single parent allowance |
120,000 |
120,000 |
| Disabled dependent allowance (each) |
66,000 |
66,000 |
| Maximum Deductions in Computing Salaries Tax (HK$) |
2013/14 * |
2012/13 |
Deduction Items
|
Deductible Amounts
|
Deductible Amounts |
| Self-education Expenses |
80,000 |
60,000 |
| Home loan interest |
100,000 |
100,000 |
| Mandatory contributions to mandatory provident fund schemes or recognized retirement schemes |
15,000 |
14,500 |
| Elderly residential care expenses |
76,000 |
76,000 |
| Approved charitable donations [(income – allowable expenses – depreciation allowances)×percentage] |
35% |
35% |
Rate of Taxation
Rate of Taxation Salaries tax is chargeable at progressive rates or standard rate, which will be the smaller of the following:
1) 15% of net total income chargeable at standard rate
2) Net chargeable income at salaries tax progressive rates
| Salaries Tax Progressive Rates (income less deduction items and allowances) (HK$) |
2013/14 * |
2012/13 |
| First $40,000 (2007/08: First $35,000) |
2% |
2% |
| Next $40,000 (2007/08: Next $35,000) |
7% |
7% |
| Next $40,000 (2007/08: Next $35,000) |
12% |
12% |
| On the remainder |
17% |
17% |
Provisional Salaries Tax
Before the related tax year ends, the Inland Revenue Department (IRD) will impose the provisional salaries tax on persons according to the tax payment assessed in the previous year. In the succeeding year, when the tax payment for the related year is assessed, the provisional tax paid will be used to pay the salaries tax payable in that year.
Note: * The tax measures proposed by the Financial Secretary in 2013/14 Budget shall be subject to legislative process before implementation.
Further information on Taxation, please contact Ms. Lam + (852) 3743 0448 |
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