Please refer to the topic 'Corporate vehicles in Hong Kong', in particular the sub-topic 'Types of corporate vehicle for investment'.
Last modified 19 Dec 2025
The obligation to pay stamp duty rests on both the vendor and purchaser, but the commercial practice in Hong Kong is that the purchaser will usually be responsible for paying it. The amount to be paid depends on the consideration/market value of the property at the time of the purchase. Payment should be completed within 30 days after the execution date of the agreement for sale or conveyance on sale for the acquisition of both residential and non-residential properties.
Under the Stamp Duty Ordinance (Cap. 117 of the Laws of Hong Kong), for any sale or transfer of immovable property, such transaction may be subject to ad valorem stamp duty (AVD) rates at Part 1 of Scale 1, Part 2 of Scale 1 or Scale 2 depending on the nature of the transaction. A summary of the Scale 1 AVD and Scale 2 AVD rates can be found on the Hong Kong Government website here.
With effect from 28 February 2024, the rates of AVD under Part 1 of Scale 1 are amended to be the same as those of AVD under Scale 2. Accordingly, any instrument executed on or after such date for the sale or purchase of any residential property or the conveyance on sale of any residential property is subject to AVD of up to 4.25% of the consideration or value of the property (whichever is higher), unless specifically exempted or otherwise provided as described below.
For non-residential property, the Stamp Duty Ordinance was amended in 2020 to revert the AVD rates from the rates under Part 2 of Scale 1 to the rates under Scale 2. Following the passing of the Stamp Duty (Amendment) Ordinance 2021, deemed to be effective from 26 November 2020, unless otherwise provided, any instrument executed on or after 26 November 2020 for the sale and purchase or transfer of non-residential property will be subject to AVD at the Scale 2 rates, while any instrument executed on or after 23 February 2013 but before 26 November 2020 for the sale and purchase or transfer of non-residential property remain subject to AVD at the Part 2 of Scale 1 rates.
To ease the burden on buyers purchasing small- and medium-sized properties and car parking spaces, especially first-time home buyers, the Hong Kong Government, under the Stamp Duty (Amendment) Ordinance 2025, has amended the value bands of the Scale 2 AVD rates payable for sale and purchase or transfer of both residential and non-residential properties. With effect from 26 February 2025, the Scale 2 AVD payable for sale or transfer of residential and non-residential properties starts at HK$100 for properties valued at up to HK$4 million, and is capped at a maximum rate of 4.25% for properties valued at HK$21,739,120 or more.
The purchaser and the vendor continue to be jointly and severally liable to pay AVD.
There were a number of exceptions to the application of the higher flat AVD rates under Part 1 of Scale 1 (ie the 15% rate for instruments of residential property executed between 5 November 2016 and 24 October 2023, and the 7.5% rate for instruments of residential property executed between 25 October 2023 and 27 February 2024); in these cases, the Scale 2 AVD rates would apply instead.
Additionally, AVD does not apply in the following cases (in which case, no AVD is payable):
For sale or transfer of residential properties, a HKPR purchaser who changes his/her single residential property would normally be entitled to a partial refund of AVD under the refund mechanism. Upon paying AVD at the 15% rate and satisfying conditions for partial refund, he/she may seek a refund of AVD paid in excess of that computed under Scale 2 rates.
HKPRs mainly include holders of valid Hong Kong Permanent Identity Cards as defined under the Registration of Persons Ordinance (Cap. 177 of the Laws of Hong Kong). This definition also extends to Buyer's Stamp Duty (see below).
BSD and SSD are not applicable to any transactions where the chargeable instruments are executed on or after 28 February 2024. The following information applies only to transactions in which both the agreement for sale and purchase and the conveyance on sale were executed before that date.
The government of Hong Kong has introduced BSD which took effect on 27 October 2012. Unless specifically exempted, BSD is payable on an agreement for sale or a conveyance on sale executed on or after 27 October 2012 but before 28 February 2024 for the acquisition of any residential property. BSD is charged at 7.5% (applicable to instruments executed between 25 October 2023 and 27 February 2024) or 15% (applicable to instruments executed between 27 October 2012 and 24 October 2023) on the stated consideration or the market value of the property (whichever is the higher), and is payable in addition to the AVD and special stamp duty (please see section on ‘Special Stamp Duty’ below), if applicable.
The buyer or the transferee is liable to pay the BSD within 30 days after the execution of the chargeable document (eg a provisional agreement of sale and purchase). If the time for stamping of any instrument chargeable with BSD falls before the amended Stamp Duty Ordinance (SDO) was published in the Gazette (i.e. 28 February 2014), that time for payment is to be replaced by a period of 30 days commencing immediately after the date of Gazette (i.e. on or before 30 March 2014).
BSD will be exempted in a number of situations. Below are the circumstances in which the Government will grant an exemption:
(i) acquisition by a HKPR jointly with a close relative(s) (i.e. spouse, parents, children, brothers and sisters) who is/are not HKPR, where each of the purchasers is acting on his/her own behalf;
(ii) transfer of property to a close relative who is not a HKPR, or to close relative(s) jointly one or more of whom not being HKPR, where each of the transferees is acting on his/her own behalf;
(iii) nomination of a close relative(s) who is/are not HKPR to take up the assignment, where each of the nominees is acting on his/her own behalf;
(iv) addition/deletion of name(s) of person(s) who is/are not HKPR to/from a chargeable agreement for sale or a conveyance on sale in respect of a residential property if the person(s) is/are a close relative(s) of the original purchaser(s), where each of the persons is acting on his/her own behalf;
(v) acquisition or transfer by or to a purchaser or transferee by a court order which includes a foreclosure order obtained by a mortgagee whether or not it falls under the definition of a financial institution within the meaning of section 2 of the Inland Revenue Ordinance (IRO);
(vi) transfer or vesting of a mortgaged residential property by or to a mortgagee which is a financial institution within the meaning of section 2 of the IRO, or by a receiver appointed by such a mortgagee;
(vii) acquisition or transfer by or to a body corporate from another associated body corporate;
(viii) acquisition of residential properties by persons to replace residential properties under various statutory schemes for urban redevelopment where the person is acting on his/her own behalf;
(ix) acquisition or transfer of residential properties by or to the Government; and
(x) gift of residential properties to charitable institutions exempted from tax under section 88 of the IRO.
SSD, where applicable, was also in force for instruments executed prior to 28 February 2024. It applied to certain disposals of residential properties where the holding period was less than 24 months (if the residential property was acquired between 20 November 2010 and 26 October 2012, or was acquired on or after 26 October 2021 and was disposed of on or after 25 October 2023 but before 28 February 2024) or 36 months (if the property was acquired on or after 27 October 2012 and was disposed of before 25 October 2023) from acquisition, with the rate (of up to 20%) depending on the length of the holding period. Instruments executed on or after 28 February 2024 are not subject to this regime.
A HK$350 levy is charged in accordance with the Property Management Services Ordinance (Cap. 626 of the Laws of Hong Kong) and the Property Management Services (Levy) Regulation (Cap. 626A of the Laws of Hong Kong). Any conveyance on sale as defined under section 2(1) of the SDO that is chargeable with stamp duty under head 1(1) in the First Schedule to the SDO is a leviable instrument. A conveyance on sale generally means each conveyance whereby any immovable property, upon the sale thereof, is transferred to, or vested in, a purchaser.
The transferee (generally the purchaser) of a leviable instrument is liable to pay the levy. If there is more than one transferee under the instrument, all transferees are jointly and severally liable to pay the levy.
The levy is payable within 30 days after the leviable instrument is executed, which is the same as the timeframe for stamping.
Last modified 19 Dec 2025
There is no VAT in Hong Kong.
Last modified 19 Dec 2025
If there is a real estate agent involved, then a commission will need to be paid to him/her. The normal commercial practice is for both the purchaser and vendor to pay 1% of the purchase price each. However, in the event that parties do not feel it is necessary to engage a real estate agent, it is possible to carry out the transaction without one.
Solicitors may be involved in the transaction for the purposes of checking title, preparing the relevant legal documents etc. As such, aside from limited circumstances provided in the Hong Kong Solicitors' Guide to Professional Conduct, the parties will need to be separately represented and therefore each will usually incur legal costs for engaging their own respective solicitors.
Last modified 19 Dec 2025
Government rent is levied on property owners regardless of whether or not the property is occupied. This cannot be offset in any way and generally speaking, it is calculated at around 3% of the rateable value of the property. The rateable value of the property is a government assessed value used for official purposes including local taxation.
Rates are a form of local taxation payable on a quarterly basis in advance. The amount payable however is determined by the Legislative Council each year and varies accordingly. For the Financial Year 2025-2026, the rates percentage charge is progressive for domestic properties: 5% on the first HK$550,000 of rateable value, 8% on the next HK$250,000, and 12% on any portion exceeding HK$800,000. For non-domestic properties, the charge remains at 5%, regardless of rateable value. In addition, a rates concession applies for the first quarter of 2025–2026, capped at HK$500 per tenement. The payment of rates can be set off against amount of property tax payable as described below.
If the property is to be let and rent is collected then property tax is payable. The exact amount payable is calculated at a percentage of the Net Assessable Value. This percentage has been set at 15% from 2008/09 onwards. The Net Assessable Value is calculated by taking the annual rental income less irrecoverable rent, municipal taxation (rates) paid by the owner(s) and a 20% statutory allowance for repairs and outgoings.
The profits generated from a business carried out by a property owner in Hong Kong (including a business of letting real properties) will likely be subject to profits tax.
However, if the rental income from property chargeable to property tax is included in the profits for profits tax purposes as mentioned above, or if the property owner occupies the property for producing chargeable profits, the amount of property tax paid will be set off against the amount of profits tax payable. This may result in greater deductions in the amounts payable as allowances with respect to repairs and maintenance to the property, interest paid in respect of the cost of acquiring the property (subject to anti-avoidance provisions) and the costs of maintaining the corporation are permitted.
Last modified 19 Dec 2025
In addition to rates (local taxation), Government rent, profits and property taxes, there will be the necessary payments of utility bills, possibly management fees and other necessary regular payments. However, in the circumstances, these should not be of a great amount.
Last modified 19 Dec 2025
Property can be rented out, which would produce rental income.
Last modified 19 Dec 2025
If property is let in the course of business, then the rental income will be subject to profits tax.
If the property is let and rent is collected then property tax is payable. The exact amount payable is calculated at a percentage of the Net Assessable Value. This percentage has been set at 15% from 2008/09 onwards. The Net Assessable Value is calculated by taking the annual rental income less irrecoverable rent, rates and 20% statutory allowance for repairs and outgoings.
However, if the rental income from property chargeable to property tax is included in the profits for profits tax purposes, or if the property owner occupies the property for producing chargeable profits, the amount of property tax paid will be set off against the amount of profits tax payable. This may result in greater deductions in the amounts payable as allowances with respect to repairs and maintenance to the property, interest paid in respect of the cost of acquiring the property (subject to anti-avoidance provisions) and the costs of maintaining the corporation are permitted.
Last modified 19 Dec 2025
Profits may be distributed tax-free as there is no withholding tax on dividends in Hong Kong.
Last modified 19 Dec 2025
No additional tax applies but stamp duty will be payable if the income is generated by a transfer (subject to possible exemptions).
Last modified 19 Dec 2025
No.
Last modified 19 Dec 2025
Stamp duty would be incurred in the sale and purchase of real property. A copy of the latest applicable scales for the calculation of stamp duty in the purchase of real estate in Hong Kong can be found here. With effect from 28 February 2024, demand-side management stamp duties, including but not limited to the Buyer’s Stamp Duty (BSD) and Special Stamp Duty (SSD), have been abolished for all residential property transactions. For most residential property transactions executed on or after 28 February 2024, only the Ad Valorem Stamp Duty (AVD) at Scale 2 rates is payable.
To ease the burden on buyers purchasing small- and medium-sized properties and car parking spaces, especially first-time home buyers, the Hong Kong Government, under the Stamp Duty (Amendment) Ordinance 2025, has amended the value bands of the Scale 2 AVD rates payable for sale and purchase or transfer of both residential and non-residential properties. With effect from 26 February 2025, the Scale 2 AVD payable for sale or transfer of residential and non-residential properties starts at HK$100 for properties valued at up to HK$4 million, and is capped at a maximum rate of 4.25% for properties valued at HK$21,739,120 or more.
With effect from 28 February 2024, SSD no longer applies to any residential property disposals, regardless of the holding period. SSD is only relevant to Agreements for Sale and Purchase (ASPs) signed before that date. The following provisions apply to transactions executed prior to 28 February 2024:
In addition to the ad valorem stamp duty, any residential property acquired on or after 20 November 2010 and for which the ASP was executed before 28 February 2024—and which is being resold within 24 months (if the property was acquired between 20 November 2010 and 26 October 2012, or was acquired on or after 26 October 2021 and was disposed of on or after 25 October 2023 but before 28 February 2024) or 36 months (if the property was acquired on or after 27 October 2012 and was disposed of before 25 October 2023) from the date of purchase—will be subject to SSD. Both the vendor and purchaser are jointly and severally liable for paying SSD. The seller and the buyer should, by consent, specify in the Provisional Agreement for Sale and Purchase (PASP) and the ASP which party (the buyer or the seller) is to pay the SSD. SSD is calculated based on the stated consideration or the market value of the property (whichever is the higher) x the applicable rate as follows:
If the property was acquired between 20 November 2010 and 26 October 2012:
If the property was acquired on or after 27 October 2012 and was disposed of before 25 October 2023:
If the property was acquired on or after 26 October 2021 and disposed of on or after 25 October 2023 but before 28 February 2024:
A chargeable agreement for sale or a conveyance on sale is to be stamped with SSD at the same time as that for the ad valorem stamp duty, i.e. in general, within 30 days after the date on which the agreement for sale or conveyance is executed.
SSD is exempted in a number of situations:
(i) nomination of the spouse, parents, children, brothers or sisters to take up the assignment of the residential property, and sale or transfer of the residential property to the spouse, parents, children, brothers or sisters;
(ii) addition /deletion of name(s) of a person(s) to / from a chargeable agreement for sale or a conveyance on sale in respect of the residential property if the person(s) is the spouse, parents, children, brothers or sisters of the original purchaser(s);
(iii) sale or transfer of residential properties by a court order or pursuant to a court order. The exemption covers a compulsory sale of residential property under a Compulsory Sale Order granted under the Land (Compulsory Sale for Redevelopment) Ordinance (Cap. 545 of the Laws of Hong Kong), and also any sale of residential property where the residential property was transferred to or vested in the vendor by or pursuant to any decree or order of any court of the Hong Kong Special Administrative Region of competent jurisdiction, including a foreclosure order obtained by the mortgagee whether or not it falls under the definition of a financial institution within the meaning of section 2 of the IRO;
(iv) sale of mortgaged residential properties in various forms by a mortgagee which is a financial institution within the meaning of section 2 of the IRO, or by a receiver appointed by such a mortgagee;
(v) sale or transfer of residential properties (including bare sites) after demolishing the original residential properties thereon for constructing redeveloped ones;
(vi) sale of the estate of a deceased person, which involves residential property, by the executor or personal representative, and sale or transfer of a residential property by a person whose property is inherited from a deceased person's estate or passed to that person under a will, the law of intestacy or the right of survivorship;
(vii) sale or transfer of residential properties between associated bodies corporate;
(viii) the residential property sold relates solely to a bankrupt's estate or the property of a company which is being wound up by the court by reason of its inability to pay debts;
(ix) sale or transfer of residential properties to the Government; and
(x) gift of residential properties to charitable institutions exempted from tax under section 88 of the IRO.
There is no capital gains tax in Hong Kong. However, if the profits of a person are in the nature of trading (i.e. the general course of business of trading of real property interest), then the profits will likely be subject to profits tax.
Last modified 19 Dec 2025
A typical sale and purchase transaction would involve estate agents and solicitors and as such, the parties would incur estate agents' commission fees and solicitors' fees.
Last modified 19 Dec 2025
How can investment in real estate by an individual/organization/company be set up?
Please refer to the topic 'Corporate vehicles in Hong Kong', in particular the sub-topic 'Types of corporate vehicle for investment'.
Last modified 19 Dec 2025