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Your complete guide to tax planning and tax loans

Does paying tax give you a headache every year? Check out our one-stop guide for a tax timetable, tax payment methods, tax deductibles and tax loans.

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Tax return and tax payment

In Hong Kong, an assessment year runs from 1 April to 31 March the following year. You should complete and send in your tax return form one month after receiving it. If you choose to do it electronically, you'll get an extension of one month.

Timetable
Month Event
May to June
 Inland Revenue Department (IRD) issues tax returns
June to July Taxpayers send back the completed and signed form online or by mail
October IRD issues assessment and tax payment notifications
January First instalment of tax due
April Second instalment of tax due
Timetable
Month May to June
 May to June
Event Inland Revenue Department (IRD) issues tax returns Inland Revenue Department (IRD) issues tax returns
Month June to July June to July
Event Taxpayers send back the completed and signed form online or by mail Taxpayers send back the completed and signed form online or by mail
Month October October
Event IRD issues assessment and tax payment notifications IRD issues assessment and tax payment notifications
Month January January
Event First instalment of tax due First instalment of tax due
Month April April
Event Second instalment of tax due Second instalment of tax due

How to pay tax in Hong Kong

Online or digital payment methods:

  • Online banking
  • Credit card
  • FPS
  • PPS
  • e-Cheque or e-Cashier Order

Other payment methods:

  • By bank ATM
  • By sending a cheque by post
  • At a convenience store
  • At a post office
  • At the Inland Revenue Centre in Kai Tak

Tax reduction

The more you earn, the more tax you pay, right? Not necessarily. Depending on their family circumstances, taxpayers can enjoy a basic allowance, a married person's allowance, a child allowance, and other dependent allowances. Certain expenses are also deductible.

Three tax-deductible products

  • MPF voluntary contributions

    On top of their mandatory monthly MPF contributions, employees can make Tax Deductible Voluntary Contributions (TVC). TVC can prepare you for a more comfortable retirement and you can benefit from a maximum tax-deductible amount of HKD60,000.

     

    You can make regular contributions or a one-off contribution. The amount can be adjusted at any time. You can also pause or resume TVC as you wish. You're free to choose your own trustee to open a TVC account.

  • Annuity

    Deferred annuity and immediate annuity schemes that are certified by the Insurance Authority and fulfil their requirements are tax deductible.

     

    In a deferred annuity plan, after your investment, you'll wait for the investment to grow for a set period before receiving regular retirement income from the agreed age or year. An immediate annuity is one where you start receiving income immediately after investing.

     

    You can choose a tax-deductible annuity plan based on your needs for tax reduction and a stable retirement income.

  • Voluntary health insurance (VHIS)

    With the huge demand and long waiting times for public health services, it's become more common to access private healthcare using private medical insurance plans.

     

    Certified plans under the Voluntary Health Insurance Scheme (VHIS) are tax deductible up to HKD8,000 per insured person annually. HSBC's VHIS plans provide full coverage of HKD5 million or more, including previously unknown conditions, with policy renewals up to age 100 guaranteed.

Rent

A taxpayer who rents their home and doesn't own any residential property in Hong Kong enjoys tax relief. The maximum tax deductible amount is HKD100,000 per year of assessment.

Home loan interest

If you own your home and are paying off a mortgage, you can apply for a tax deduction. Additional deduction of home loan interest is available for those who live with their minor children.

Education expenses

If you've completed eligible self-education courses in Hong Kong, you can include these expenses when filing for tax. Examples of these courses include a management course taken by a business executive and a vocational training course taken by a technician.

Donation

If you donate to tax-exempt charities or to the government for charitable purposes within the year of assessment, your donations are tax-deductible.

Tax loans

Apart from tax allowances and tax deductibles, learning more about personal loan options can help with your tax planning.

Banks offer tax loan products during tax season every year to allow you more financial flexibility.

Lower interest rate during tax season

The APR and monthly flat rate offered with personal loans during tax season are lower to cover your needs. These loan products come with flexible repayment periods and zero handling fees.

HSBC Personal Tax Loan is provided every year during tax season. Applicants enjoy fast approval in just 1 minute and can withdraw cash quickly for their tax payment. During the promotional period, cash rebates or RewardCash are offered. Please refer to the product page for details.

How do I apply for a tax loan?

Applying for a tax loan is the same as applying for other loan products. You can apply through online banking or mobile banking or by visiting a branch. Some banks, such as HSBC, provide a 24-hour application hotline to meet your needs.

Personal loans are available at a lower interest rate during tax season to help increase your liquidity. For more financial flexibility, consider applying for loan products such as personal instalment loans and cash instalment plans.

If you need help with your cash flow when paying tax, please call our hotline at (852) 2748 8080, complete an online application form, or apply in a few steps via the HSBC HK App.

To borrow or not to borrow? Borrow only if you can repay!

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