HK Tax Loan Repayment Calculator
Hong Kong tax loans are short-term personal loans designed to pay salaries tax demanded annually by IRD (typically December-January). Rates start at 1.85% per annum (APR ~3-5%) — far cheaper than standard personal loans.
How HK Tax Loans Work
Banks offer short-term unsecured loans timed to coincide with annual salaries tax demand (December-January). Designed for taxpayers who lack cash to pay assessed tax. Loan repaid over 6-24 months. Lower rates than standard personal loans because banks are competing for high-income, employed clients.
Flat Rate Vs APR
Marketing materials often quote 'flat rate' of 1.0-1.5% per annum. This is misleading — true APR is roughly double the flat rate because principal is paid down monthly but flat-rate is applied to original balance throughout. HKMA-required APR disclosure shows the real comparable rate.
When To Take A Tax Loan
Only if (a) you cannot pay tax in full or (b) you can invest the cash for return higher than loan rate. With APR 3-4%, almost any reasonable investment beats. But interest cost still reduces overall return. Alternative: IRD instalment scheme allows interest-free monthly payments for hardship cases.
Source: Hong Kong Monetary Authority Tax Loan Disclosure Guidelines, ird.gov.hk Instalment Schemes. Last updated: May 2026.