HK Salaries Tax Calculator 2026/27

How Hong Kong Salaries Tax Works in 2026/27

Hong Kong salaries tax is one of the lowest in the Asia-Pacific region, designed to attract international talent. For the 2026/27 assessment year (covering income earned between 1 April 2026 and 31 March 2027), the Inland Revenue Department (IRD) calculates your liability using two parallel methods and charges you whichever is lower.

The progressive method applies rates of 2%, 6%, 10%, 14%, and 17% to bands of net chargeable income — that is, your income after the Mandatory Provident Fund (MPF) deduction and all personal allowances. The standard rate method charges a flat 15% on your net income (income minus MPF only, with no allowances deducted). For most mid-range earners, the progressive method results in a lower bill; for very high earners, the standard rate cap at 15% becomes advantageous. This calculator handles both computations automatically. Source: ird.gov.hk — Salaries Tax.

Personal Allowances and Deductions for 2026/27

Understanding your allowances is key to reducing your salaries tax bill. The basic allowance for a single taxpayer is HK$132,000. If you are married and opting for joint assessment, you can claim the married person's allowance of HK$264,000 instead. For each dependent child (from the 1st through the 9th), you can claim HK$130,000 per child. In the year a child is born, an additional HK$130,000 is available as a newborn allowance on top of the standard child allowance for that child — making the first-year benefit HK$260,000 per newborn.

The Mandatory Provident Fund (MPF) deduction covers your mandatory contributions, calculated at 5% of relevant income up to a maximum deductible amount of HK$18,000 per year (based on a monthly income ceiling of HK$30,000, i.e., HK$360,000/year). Voluntary contributions above mandatory amounts are not deductible for salaries tax purposes.

Progressive Tax Bands vs Standard Rate — Which Applies?

The five progressive tax bands for 2026/27 are:

• First HK$50,000 of net chargeable income: 2%
• Next HK$50,000: 6%
• Next HK$50,000: 10%
• Next HK$50,000: 14%
• Remainder above HK$200,000: 17%

For comparison, the standard rate of 15% is applied to net income (income minus MPF), with no personal allowances deducted. A high-income earner with minimal allowances will often find the standard rate lower than the progressive rate on the upper portion of their income. The IRD charges whichever method produces the smaller tax bill — you do not need to choose or file separately for each method.

Tips to Reduce Your Hong Kong Salaries Tax

Several legitimate strategies can reduce your salaries tax liability. Making voluntary MPF contributions beyond the mandatory 5% will not provide additional salaries tax deductions, but approved charitable donations are deductible (subject to limits). Maximising approved self-education expenses (up to HK$100,000 per year for approved courses) is another valuable deduction not captured in this calculator — if eligible, add them to your net income figure before estimating here. Married couples should compare the tax outcomes of joint assessment versus separate assessments, as the optimal choice depends on each spouse's income level. Last updated: April 2026.