๐ญ๐ฐ Corporate Tax in Hong Kong
Headline rate: 8.25โ16.5% (two-tier)
Private Limited Company (Ltd)
Hong Kong operates a territorial tax system. Only profits sourced in Hong Kong are subject to profits tax. The two-tier rate applies: 8.25% on the first HKD 2 million of assessable profits, and 16.5% on the remainder. There is no VAT or GST, no capital gains tax, no withholding tax on dividends or interest paid to non-residents, and no estate duty. Companies must file an annual Profits Tax Return and are required to have their accounts audited by a Hong Kong CPA.
Branch Office (Branch)
A branch office is taxed on the same territorial basis as a Hong Kong-incorporated company. Only profits arising in or derived from Hong Kong are subject to profits tax at the standard two-tier rate (8.25% on the first HKD 2 million, 16.5% thereafter). The branch must maintain proper books of account, file a Profits Tax Return annually, and may be required to have its Hong Kong accounts audited. Transfer pricing rules apply to transactions between the branch and its parent company.
Key Facts
- Double tax treaties: 45
- Memberships: WTO, APEC
- Legal system: Common law
- Fiscal year: April โ March
This content is educational and does not constitute legal or tax advice. Always consult a qualified professional for your specific situation. Data last verified March 2026.