CALCULATION OF THE HONG KONG SALARY TAX:

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The salary tax is regulated under section 8 of the Inland Revenue Ordinance. The tax on salaries, is subject to the provisions of the IRO, and shall be taxed each year to the income of each employee, “cargo y/o pensión”, arised in or derived from Hong Kong 

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The one year evaluation period runs from the 1st of April to the 31st of March of the following year. 

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Individuals are taxed at a progressive rate on their net income, that is to say after deductions and deductions starting at 2% and ending at 17%; Or at a standard rate of 15% on the net income ( meaning, the income after deductions), whichever is lower in favor of the individual. 

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 The table below reflects the rates for the current fiscal year 2016/2017. 

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Once the calculation has been made,  the tax on the salary and on the personal income for the 2016/2017 year will have a 75% reduction subject to a maximum of 20,000 HKD$ per case.

 

If more information is required regarding this subject please do not hesitate to contact us. 

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