Hong Kong Salaries Tax Calculator 2024/25
Calculate Hong Kong salaries tax with progressive rates and standard rate comparison. Includes all personal allowances, dependent parents, MPF deductions, and progressive vs standard rate analysis.
HK$
Total employment income (salaries, wages, bonuses) Married allowance: HK$264,000 (vs $132,000 single)
HK$50,000/parent if living with you vs HK$25,000
HK$
Max deductible: HK$18,000/year Examples:
HK$0
Salaries Tax Payable
Progressive
Rate Method Applied
0%
Effective Tax Rate
HK$0
Net Annual Income
Hong Kong Tax Breakdown
| Item | Amount |
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How Hong Kong Salaries Tax Works
Hong Kong's Inland Revenue Department (IRD) assesses salaries tax on income from employment. The system automatically determines whether progressive rates or the 15% standard rate gives a lower tax bill โ you always pay the lower amount.
Tax Calculation Formula
Net Assessable Income = Employment Income โ MPF (max HK$18,000)
Total Allowances = Basic + Married + Children (HK$130K each) + Parents (HK$25Kโ$50K each)
Net Chargeable Income = Net Assessable Income โ Total Allowances
Progressive Tax = 2% ร first $50K + 6% ร next $50K + 10% ร next $50K + 14% ร next $50K + 17% ร remainder
Standard Rate Tax = Net Assessable Income ร 15%
Salaries Tax = min(Progressive Tax, Standard Rate Tax)
Total Allowances = Basic + Married + Children (HK$130K each) + Parents (HK$25Kโ$50K each)
Net Chargeable Income = Net Assessable Income โ Total Allowances
Progressive Tax = 2% ร first $50K + 6% ร next $50K + 10% ร next $50K + 14% ร next $50K + 17% ร remainder
Standard Rate Tax = Net Assessable Income ร 15%
Salaries Tax = min(Progressive Tax, Standard Rate Tax)
Example
Single, HK$500,000 income, HK$18,000 MPF:
Net Assessable = $500,000 โ $18,000 = $482,000
Net Chargeable = $482,000 โ $132,000 (basic allowance) = $350,000
Progressive: 2%ร$50K + 6%ร$50K + 10%ร$50K + 14%ร$50K + 17%ร$150K = $1K+$3K+$5K+$7K+$25.5K = $41,500
Standard: $482,000 ร 15% = $72,300
Tax = min($41,500, $72,300) = $41,500 (progressive)
Net Assessable = $500,000 โ $18,000 = $482,000
Net Chargeable = $482,000 โ $132,000 (basic allowance) = $350,000
Progressive: 2%ร$50K + 6%ร$50K + 10%ร$50K + 14%ร$50K + 17%ร$150K = $1K+$3K+$5K+$7K+$25.5K = $41,500
Standard: $482,000 ร 15% = $72,300
Tax = min($41,500, $72,300) = $41,500 (progressive)
Extended
Progressive vs Standard Rate Breakeven
Find exactly where the 15% standard rate becomes cheaper than progressive rates for your allowance level
Progressive vs Standard Rate Crossover
At higher incomes, the 15% standard rate becomes cheaper than progressive rates. The table shows your tax at various income levels.
| Annual Income | Progressive Tax | Standard Rate Tax (15%) | Tax Payable | Method |
|---|
Frequently Asked Questions
What are the Hong Kong salaries tax brackets?
Hong Kong uses progressive rates on net chargeable income (income minus allowances): HK$0โ$50,000: 2%, HK$50,001โ$100,000: 6%, HK$100,001โ$150,000: 10%, HK$150,001โ$200,000: 14%, HK$200,001+: 17%. However, if the progressive tax exceeds the standard rate tax (15% flat on net assessable income), you pay the lower amount. This standard rate cap protects higher earners from excessively high effective rates.
What is the difference between progressive rates and the standard rate in Hong Kong?
Hong Kong's progressive rates apply to net chargeable income (after personal allowances). The standard rate is 15% applied to net assessable income (before personal allowances). Taxpayers pay whichever is lower. For most people with incomes up to about HK$2 million, progressive rates produce a lower tax. Above this level, the 15% standard rate typically becomes lower โ making Hong Kong's effective rate a flat 15% for high earners.
What is the basic personal allowance in Hong Kong?
The basic personal allowance is HK$132,000 per year (2024/25). Married taxpayers get HK$264,000. Each dependent child adds HK$130,000 (first child) to HK$130,000 (subsequent children). Each dependent parent or grandparent aged 55+ adds HK$25,000 (not living with taxpayer) or HK$50,000 (living with taxpayer). These allowances reduce net chargeable income before applying progressive rates.
How does MPF (Mandatory Provident Fund) affect Hong Kong taxes?
MPF contributions are tax-deductible up to HK$18,000 per year for the employee's mandatory contribution. Voluntary contributions to MPF or approved retirement schemes may qualify for additional deductions. The deduction reduces your net assessable income (and thus net chargeable income) before tax is calculated. Self-employed individuals can also deduct MPF contributions against their assessable profits.
Does Hong Kong have any other major taxes beyond salaries tax?
Hong Kong's tax system is unusually simple by international standards. There is no capital gains tax, no GST/VAT, no sales tax, and no estate duty (abolished in 2006). The main taxes are: Salaries Tax (on employment income), Profits Tax (15-16.5% on business profits), Property Tax (15% on rental income), and Stamp Duty on property and share transactions. There is no national insurance or social security tax beyond MPF.