About this calculator
Salaries tax in Hong Kong is charged on your income from employment after deductible outgoings (such as mandatory MPF contributions) and allowances, in HK$50,000 bands at 2%, 6%, 10% and 14%, with the remainder at 17%. In parallel, the IRD computes tax at the standard rate on your net income before allowances — 15% on the first HK$5 million and 16% above that since 2024/25 — and your assessment is whichever figure is lower. For most employees the progressive computation wins; the standard rate is a cap that mostly binds at very high incomes.
Allowances are where the family arithmetic lives: HK$132,000 basic for 2025/26 (HK$145,000 in 2026/27), HK$130,000 per child (140,000 in 2026/27, doubled in the year of birth), and dependent-parent allowances that double when the parent lives with you. Pick the year of assessment at the top — the allowance table changes, the rate bands and the MPF rules do not.
How to use it
- Choose the year of assessment and enter your monthly salary (annual salary is monthly × 12).
- Leave MPF on the automatic setting unless your scheme differs — it applies 5% of monthly pay between HK$7,100 and HK$30,000.
- Choose your personal allowance basis and count the children and dependent parents you claim.
- Add other deductions you claim (within the caps in the hint).
- Compare the two tax figures — the calculator charges the lower, exactly like an IRD assessment.
The formula
Worked example for 2025/26, single, salary HK$600,000: the MPF is capped at 1,500/month = HK$18,000, net income is HK$582,000, allowances HK$132,000 leave net chargeable income of HK$450,000. Progressive tax: 1,000 + 3,000 + 5,000 + 7,000 + 250,000 × 17% = HK$58,500. Standard rate: 582,000 × 15% = HK$87,300. The lower figure, HK$58,500, is the tax — an effective rate of 9.75%.
Worked example
Single, HK$50,000 a month (HK$600,000 a year), 2025/26, mandatory MPF: tax is HK$58,500 (progressive basis), as broken down in the formula above. Under 2026/27 allowances (basic allowance HK$145,000) the same salary leaves net chargeable income of HK$437,000 and pays HK$56,290.
Sources: IRD PAM 61(e) — Allowances, Deductions and Tax Rate Table (August 2026 edition, covering 2025/26 and 2026/27); MPFA mandatory contribution levels (5%, HK$7,100–30,000/month). Verified October 2026. Last updated: October 2026.
Frequently asked questions
Why does the IRD charge the lower of two computations?
It is built into the Inland Revenue Ordinance: salaries tax is charged at progressive rates on net chargeable income or at the standard rate on net income, whichever produces less tax. The standard rate acts as a ceiling — historically it bound only for high earners with few allowances. In practice, progressive tax wins until net income approaches roughly HK$2 million for a single person with basic allowance only; above several million, the 17% top progressive rate on most income makes the 15%/16% standard rate the cap.
How much MPF can I deduct?
Your mandatory employee contributions are deductible up to HK$18,000 per year. The mandatory contribution itself is 5% of monthly relevant income, with no contribution below HK$7,100/month and a cap at HK$30,000/month — so the maximum employee contribution is HK$1,500/month, which is exactly the HK$18,000 deduction cap. Voluntary contributions are not deductible unless they are tax-deductible MPF voluntary contributions (TVC), which share a HK$60,000 combined cap with qualifying annuity premiums.
What changed for 2026/27?
Allowances rise across the board: basic and single-parent allowances to HK$145,000, married person’s to HK$290,000, child allowance to HK$140,000 (with a new additional allowance for each child in the first two years after childbirth), dependent-parent allowances to HK$55,000 / HK$27,500 (doubled again when the parent lives with you). The elderly residential care expenses cap rises to HK$110,000. The rate bands, the two-tier standard rate and the MPF cap are unchanged.
Is the one-off tax reduction included?
No — deliberately. The 2025/26 Budget granted a 100% reduction of final tax capped at HK$3,000 per case, but that is a year-specific concession announced in each Budget, not part of the rate structure. If it applies to your 2025/26 assessment, subtract HK$3,000 (or your full tax, if less) from the figure shown: the worked example above would pay HK$55,500 after the reduction.
I earn bonuses and pay rent — can I include them?
Bonuses are simply salary for salaries tax — add them to the annual salary figure. Rent you pay for your home is deductible under the domestic rents deduction (basic cap HK$100,000, plus HK$20,000 for eligible taxpayers) if you meet the conditions (tenancy under a stamped agreement, no employer-provided residence, and more); enter it under other deductions, within the cap. Home loan interest on a property you own and live in is the alternative property deduction — you cannot claim both it and the rent deduction for the same period.
What formula does this Hong Kong Salaries Tax calculator use?
Annual salary = Monthly salary × 12; net income = Annual salary − deductions (incl. MPF ≤ HK$18,000); Net chargeable income = Net income − allowances; Tax = min(progressive tax, standard-rate tax) Worked example for 2025/26, single, salary HK$600,000: the MPF is capped at 1,500/month = HK$18,000, net income is HK$582,000, allowances HK$132,000 leave net chargeable income of HK$450,000. Progressive tax: 1,000 + 3,000 + 5,000 + 7,000 + 250,000 × 17% = HK$58,500. Standard rate: 582,000 × 15% = HK$87,300. The lower figure, HK$58,500, is the tax — an effective rate of 9.75%. The worked example on this page applies the formula step by step with real numbers, so you can verify the result by hand.