In this course · 3 of 4
Course 7
Stamp duty, rent and royalties
4 lessons · 6 min
The short answer
Property tax is charged on the owner of land or buildings in Hong Kong at the standard rate of 15% on net assessable value. Net assessable value is the rent received less rates paid by the owner and a 20% statutory allowance for repairs and outgoings. Companies that rent property are usually under profits tax instead.
Property tax applies to owners of Hong Kong land or buildings who receive rent.
Calculation (per the Inland Revenue Department (IRD) guide)
- Start with the assessable value: rent received or receivable, plus premiums, service charges paid to the owner, and owner's expenses borne by the tenant. Irrecoverable rent can be deducted.
- Deduct rates paid by the owner (not government rent or management fees).
- Deduct a 20% statutory allowance for repairs and outgoings.
- Apply the standard rate of 15% (2019/20 onwards, including 2025/26).
Individuals. An individual landlord can elect personal assessment so that property income is combined with other income and allowances apply. The one-off 2025/26 tax reduction does not apply to property tax directly, but may apply through personal assessment.
Companies. A corporation that lets property in Hong Kong is regarded as carrying on business, so it is chargeable to profits tax on the rent. Property tax paid is set off against the profits tax, and on written application the corporation may be exempt from paying property tax.
Joint owners receiving rent file property tax returns. Tenancy agreements must be stamped (see the stamp duty answer).
Legal basis and sources
The law
- Inland Revenue Ordinance (Cap. 112), s.5
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
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