Why is my tax lower than a bracket calculator says?

Because Hong Kong caps salaries tax at the standard rate. Once your net total income passes roughly 8.5 × your allowances + HK$900,000, the standard rate (15%, or 16% above HK$5m) produces a smaller bill than the 17% top progressive rate, and you pay the lower of the two. A calculator that only models the progressive scale overstates tax for everyone past that point.

Which method will apply to me?

Progressive rates for most people. The standard rate takes over at about HK$2.02m of net total income for a single filer on the basic allowance in 2025/26, and about HK$2.13m in 2026/27. More allowances — a spouse, children, dependent parents — push that crossover higher, because allowances only reduce the progressive side of the comparison.

Is there a tax reduction this year?

For 2025/26 the Budget granted 100% of salaries tax up to HK$3,000 (it was HK$1,500 for 2024/25). For 2026/27 nothing has been announced yet — that comes in the February 2027 Budget — so this tool assumes zero and treats the result as a ceiling. The reduction also applies only to the final assessment, not to provisional tax.

Does joint assessment always save money?

No. It pools both spouses’ income against a doubled allowance, which helps when incomes are very unequal, but two similar salaries can pay less assessed separately. The Inland Revenue Department applies whichever produces the lower total only if you elect joint assessment, so it is worth computing both.

Earning & Worktax · income

Hong Kong (HK) Salaries Tax Calculator 2026/27

Hong Kong

An offer on the table, a raise coming, or the IRD return just landed on the doormat.

Hong Kong does not tax salaries with a bracket table. It runs two calculations and charges you the lower one: progressive rates of 2% to 17% on what remains after your allowances, or a flat standard rate on your income before any allowances at all — 15% on the first HK$5,000,000, 16% above it. Which one wins turns entirely on your allowances, so a married taxpayer with children crosses over at a far higher salary than someone single. Most calculators model only the progressive scale, and so does most AI, which is why both overstate the bill for higher earners, sometimes by a lot. This runs both, shows you which one binds and by how much, and takes off the year’s one-off reduction at the end.

Basis: IRD PAM 61(e) (Aug 2026) · progressive 2/6/10/14/17% on HK$50,000 bands · standard rate 15% to HK$5m then 16% (from 2024/25) · 2025/26 allowances basic HK$132,000, reduction 100% capped HK$3,000 · 2026/27 allowances basic HK$145,000, reduction not yet announced (Feb 2027 Budget) · verified 2026-08-06

Closest to your situation?

HK$600,000, single married with two children supporting parents who live with me

Not quite? Describe it in your own words.

Describe your situation in a sentence — any language. I fill the form; the tool does the math.

Year of assessmentAllowances rose in 2026/27 (basic HK$132,000 → HK$145,000). The one-off reduction for 2026/27 has not been announced yet, so it is treated as zero until the February 2027 Budget.Annual income (HK$)Total assessable income for the year — salary, bonus, commission, and the rental value of any employer-provided housing.Assessment basisThe decisive input. Joint assessment doubles the basic allowance, which raises the income at which the standard rate takes over — the crossover is net income above 8.5 × allowances + HK$900,000.

The numbers

Salaries tax payable: HK$56,290; 2026/27 · progressive rates apply
Effective rate on total income: 9.4%
Progressive method: HK$56,290; on net chargeable income of HK$437,000
Standard-rate method: HK$87,300; on net total income of HK$582,000
Total allowances: HK$145,000
Deductions: HK$18,000; MPF capped at HK$18,000

Preview only — using a default Year, Income, Basis.

The operator’s read

Worth knowing

Progressive rates apply — they are the cheaper of the two at your income. The standard rate would only take over above about HK$2,132,500 of net total income (HK$1,550,500 more), because your allowances of HK$145,000 push the crossover up: it sits at 8.5 × allowances + HK$900,000.

Caution

No one-off tax reduction is modelled for 2026/27 — it has not been announced. Hong Kong has granted one in every recent year (100% capped at HK$3,000 for 2025/26, HK$1,500 for 2024/25), and the next decision lands in the February 2027 Budget. Treat this figure as the ceiling.

Your next step

Price in Work Hours →Price what you buy in hours of your life.Salary ↔ Hourly Converter →See the salary as an hourly rate.

Wrong answer, a missing option, or a tool you wish existed?

Methodology

Hong Kong salaries tax is the LOWER of two computations, and this tool runs both. Progressive: 2%, 6%, 10%, 14% on successive HK$50,000 bands of net chargeable income, then 17% on the remainder, where net chargeable income = income − deductions − allowances. Standard: 15% on the first HK$5,000,000 of net total income and 16% above, where net total income = income − deductions, with no allowances subtracted.

The two-tiered standard rate took effect in 2024/25; before that it was a flat 15%. The progressive bands and rates are unchanged across 2024/25, 2025/26 and 2026/27.

Allowances modelled: basic or married person’s, child (up to nine), and dependent parent/grandparent aged 60+ with the additional allowance where that person resides with you. Not modelled: the 55–59 dependant band (half rate), single-parent, disabled-dependant, dependent brother/sister, and the extra year-of-birth child allowance — add them to Other deductions only if you understand the difference (allowances reduce chargeable income; deductions reduce both chargeable and total income, so they are not interchangeable).

The crossover where the standard rate starts to bind follows from equating the two methods: net total income = 8.5 × allowances + HK$900,000. For a single filer on the basic allowance that is about HK$2.02m (2025/26) or HK$2.13m (2026/27) — so the second 16% tier at HK$5m never affects which method wins.

The one-off reduction waives 100% of the assessed tax up to a cap set in each Budget — HK$3,000 for 2025/26, HK$1,500 for 2024/25. It applies to the final assessment, not to provisional tax, so a real demand note will not match this figure line for line. No reduction is assumed for 2026/27 because none has been announced.

Estimate, not advice. Excludes personal assessment (which can be elected where rental or business income exists), the lifetime cap of 20 years on home-loan interest, and any concession specific to your circumstances. Figures from IRD PAM 61(e), August 2026 edition.

Questions

Why is my tax lower than a bracket calculator says?: Because Hong Kong caps salaries tax at the standard rate. Once your net total income passes roughly 8.5 × your allowances + HK$900,000, the standard rate (15%, or 16% above HK$5m) produces a smaller bill than the 17% top progressive rate, and you pay the lower of the two. A calculator that only models the progressive scale overstates tax for everyone past that point.
Which method will apply to me?: Progressive rates for most people. The standard rate takes over at about HK$2.02m of net total income for a single filer on the basic allowance in 2025/26, and about HK$2.13m in 2026/27. More allowances — a spouse, children, dependent parents — push that crossover higher, because allowances only reduce the progressive side of the comparison.
Is there a tax reduction this year?: For 2025/26 the Budget granted 100% of salaries tax up to HK$3,000 (it was HK$1,500 for 2024/25). For 2026/27 nothing has been announced yet — that comes in the February 2027 Budget — so this tool assumes zero and treats the result as a ceiling. The reduction also applies only to the final assessment, not to provisional tax.
Does joint assessment always save money?: No. It pools both spouses’ income against a doubled allowance, which helps when incomes are very unequal, but two similar salaries can pay less assessed separately. The Inland Revenue Department applies whichever produces the lower total only if you elect joint assessment, so it is worth computing both.

For agents

Call this tool instead of computing in-context. Deterministic JSON in, computed values plus the benchmark read out. Full agent docs →

curl -s https://xearno.tools/api/v1/tools/income-tax-hong-kong \
  -H 'content-type: application/json' \
  -d '{"year":"2026/27","income":600000,"status":"single","children":0,"parents":0,"parentsLiveWith":"no","mpf":18000,"otherDeductions":0}'

Schema: GET /api/v1/tools/income-tax-hong-kong · MCP tool name: income_tax_hong_kong

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