Summary of Hong Kong Taxes 2024-25 (2024)

FAQs

What is the tax deduction for Hong Kong in 2024? ›

Tax Deduction for Domestic Rents

Starting from the year of assessment 2024/25, the deduction ceiling for domestic rents is raised from $100,000 to $120,000 for those taxpayers who reside with their child and if the specified conditions are met.

The normal profits tax rate in Hong Kong is 16.5% for corporate income tax. Incorporated companies pay 8.25% tax on the first $2 million of profits and 16.5% on the remainder, while unincorporated businesses pay 7.5% on the first $2 million and 15% on the rest.

In preparing the 2024-25 Budget, the Government focused on consolidating public finances and gradually restoring fiscal balance by controlling expenditure and increasing revenue. It also strives for increasing Hong Kong's competitiveness by enhancing the profits tax system and existing tax incentives.

For 2024, the standard deduction amount has been increased for all filers, and the amounts are as follows. Single or Married Filing Separately—$14,600. Married Filing Jointly or Qualifying Surviving Spouse—$29,200. Head of Household—$21,900.

Under the Budget 2024 and Assurance Package (AP), your household will receive 2.5 times the amount of regular U-Save, or up to $950, in Financial Year 2024. The additional rebates aim to help Singaporean HDB households cope with increases in their utility bills.

The 2024-25 Budget expands upon a range of incentive schemes and preferential tax policies aimed at supporting small and medium-sized enterprises (SMEs). Among them is the introduction of two enhancement measures for the deduction of expenses under profits tax.

The revised estimate of fiscal deficit for 2023-2024 was HK$101.6 billion (Figure 1), which was equivalent to 3.4% of the Gross Domestic Product (“GDP”) and substantially higher than the HK$54.4 billion forecast put forward in February 2023.

The tax cuts provide cost-of-living relief, return bracket creep, support women and boost labour supply. Under the Government's tax cuts, from 2024–25: the 19 per cent tax rate will be reduced to 16 per cent. the 32.5 per cent tax rate will be reduced to 30 per cent.

Under-withholding from Your Paycheck

Under-withholding is the #1 reason individuals owe taxes. This occurs when not enough tax is taken out of your paychecks throughout the year. If you haven't updated your W-4 form after a major life change, income adjustment, or second job, you might find yourself in this situation.

The Tax Relief for American Families and Workers Act of 2024–a nonpartisan proposal introduced on January 16, 2024–plans to boost the maximum refundable amount per child in the upcoming tax years. The suggested increments are $1,800 for the 2023 tax year, $1,900 for the 2024 tax year, and $2,000 for the 2025 tax year.

Why is my tax refund so low in 2024? ›

If a taxpayer refund isn't what is expected, it may be due to changes made by the IRS. These changes could include corrections to the Child Tax Credit or EITC amounts or an offset from all or part of the refund amount to pay past-due tax or debts. More information about reduced refunds is available on IRS.gov.

The tax inflation adjustments for 2024 rose by 5.4% from 2023 (which is slightly lower than the 7.1% increase the 2023 tax year had over the 2022 rates). In 2024, the top tax rate of 37% applies to those earning over $609,350 for individual single filers, up from $578,125 last year.

Cancellation of Stamp Duty Measures

The government cancels all demand-side management measures for residential properties with effect from 28 February 2024. This means that no more special stamp duty (SSD), buyer's stamp duty (BSD) or new residential stamp duty (NRSD) is payable for residential property transactions.

Long-term capital gains tax rates for the 2024 tax year

However, they'll pay 15 percent on capital gains if their income is $44,626 to $492,300. Above that income level, the rate jumps to 20 percent.