HK Tax Reserve Certificate Interest Calculator

Tax Reserve Certificates (TRCs) are interest-bearing certificates issued by the Inland Revenue Department to help taxpayers save toward their next tax bill. The current rate (2026) is around 0.07% per annum — very low. The certificates can also be purchased compulsorily when an objection is lodged against a tax assessment, so the disputed amount is held safely pending resolution. Source: IRD Tax Reserve Certificates.

When TRCs Make Sense

For voluntary saving toward a future tax bill, TRCs almost never beat a HKD high-yield savings account or money-market fund. Current 2026 TRC rate of around 0.07% per annum is hundreds of basis points below typical HKD deposit rates (3-5% in 2026). The main appeal of voluntary TRCs is forced discipline — funds in TRCs can only be redeemed for tax payment or as cash with surrender, removing temptation to spend.

TRCs for Tax Objection (Mandatory Use)

Under section 71(2) of the Inland Revenue Ordinance, when you lodge an objection against an assessment that has not yet become final, IRD may require you to purchase TRCs covering the disputed tax. If your objection eventually succeeds, the TRCs are surrendered with interest at the prevailing rate from purchase to surrender date. If the objection fails, the TRCs are applied to settle the tax. This safeguards the tax owed while preserving your appeal rights.

How to Buy and Redeem TRCs

TRCs can be bought at any post office in Hong Kong or online via the eTRC system on the IRD website. Minimum purchase is HK$300, in multiples of HK$50 thereafter. Each TRC bears the purchase date and matures at face value for tax payment. Interest accrues monthly at the rate prevailing in the month of purchase and is paid only when the TRC is used to settle tax (or surrendered for cash, no interest). Keep certificates safe — replacement requires statutory declaration if lost.

Provisional Tax Saving — Better Alternatives

Most taxpayers should not use TRCs for routine saving. Better alternatives: (1) HKD savings account at a virtual bank (3-4% in 2026), (2) HKD money-market fund (3.5-4.5%), (3) Singapore SGD/USD time deposit if you have IB account, (4) US Treasury T-bills via TradeKing/IB at 4-5% USD. The IRD rate has not exceeded 1% in over a decade, so TRCs are pure convenience tool, not yield play.

Last updated May 2026. Sources: IRD — Tax Reserve Certificates, IRD — Objection Procedure.