Hong Kong salaries tax calculator (2026/27)
Hong Kong salaries tax calculator (2026/27)Your Hong Kong take-home pay is your salary minus your 5% MPF contribution (between the $7,100 and $30,000 monthly levels) and salaries tax, which is the lower of progressive rates on income after allowances and the 15% standard rate on income before them.
Worked example · Net / year
You keep 88.8% of gross pay 11.2% goes to tax and contributions
With Gross annual salary of 480,000 HKD, this model computes Net / year 426,110 HKD. See the full working.
✓ Verified against 6 self-test cases Updated for 2026/27 · sources checked 2026-10-12
How salaries tax in Hong Kong is calculated
Salaries tax is computed **two ways and you pay the lower**. Progressive rates of 2%, 6%, 10% and 14% on successive $50,000 bands, then 17%, apply to *net chargeable income* — income after deductions **and** allowances. The standard rate, 15% on the first $5 million and 16% above it, applies to *net income* — after deductions but with **no** allowances. Only very high earners end up on the standard rate.
From the year of assessment 2026/27 the allowances rose for the first time in years: the basic allowance from $132,000 to **$145,000**, the married person’s allowance to $290,000 and the child allowance to $140,000 per child. IRD’s own example: $480,000 of salary, $18,000 of MPF and the basic allowance leave $317,000 chargeable, and tax of **$35,890**.
The employee’s **MPF** contribution is 5% of relevant income, but only between the $7,100 and $30,000 monthly levels: below $7,100 the employee pays nothing, above $30,000 it is capped at $1,500 a month. That makes $7,100 a genuine step — a pay rise across it starts a $355 monthly contribution at once. Mandatory contributions are deductible up to $18,000 a year.
Salaries tax is not withheld from pay: it is assessed after the year, with provisional tax for the next year on top. One-off reductions (100% capped at $3,000 for 2025/26) are announced in each February’s Budget, so none is assumed for 2026/27. Estimate, not tax advice.
Worked example
ShowHide the full working: 3 inputs, 10 computed steps
| Inputs | |
|---|---|
| Gross annual salary (HKD) | 480,000 HKD |
| Allowance | Basic allowance (single, or spouse taxed separately) |
| Children you claim for | 0 |
| Computed by the engine | |
| Employee MPF (5%, capped) ✓ pinned | 18,000 HKD |
| Mpf Deduction | 18,000 |
| Net total income (after the MPF deduction) ✓ pinned | 462,000 HKD |
| Allowances | 145,000 HKD |
| Net chargeable income ✓ pinned | 317,000 HKD |
| Tax at progressive rates ✓ pinned | 35,890 HKD |
| Tax at standard rate ✓ pinned | 69,300 HKD |
| Salaries tax (the lower) ✓ pinned | 35,890 HKD |
| Net / month | 35,509.17 HKD |
| Net / year (after MPF & salaries tax) ✓ pinned | 426,110 HKD |
Every computed row comes from the engine, run on the inputs above. Rows marked ✓ pinned are also fixed by a published self-test, so a change to the model that moved them would fail its own tests.
Frequently asked questions
How much salaries tax do I pay on $40,000 a month in Hong Kong?
For 2026/27, $480,000 a year less $18,000 MPF and the $145,000 basic allowance leaves $317,000 chargeable. Progressive tax is $35,890, well below the $69,300 the standard rate would give, so $35,890 is payable — IRD’s own worked example.
What is the basic allowance for 2026/27?
$145,000, up from $132,000. The married person’s allowance is $290,000 and the child allowance $140,000 for each of the first to ninth child.
When does the 15% standard rate apply?
When it gives less tax than the progressive rates. Because it is charged on income before allowances, that only happens at high incomes; above $5 million of net income the excess is taxed at 16%.
How much MPF is deducted from my salary?
5% of monthly relevant income between $7,100 and $30,000, so at most $1,500 a month. Employees earning under $7,100 a month make no mandatory contribution, though their employer still does.
Sources
- Inland Revenue Department, A guide to Salaries Tax (pam39e) — progressive and two-tiered standard rates, the 2026/27 basic and married person’s allowances and the MPF deduction, with worked 2026/27 examples · checked 2026-10-12
- Inland Revenue Department, 2026-27 Budget — Tax Measures (FAQ): allowances from 2026/27, including the child allowance of $140,000 for each of the 1st to 9th child · checked 2026-10-12
- MPFA, Mandatory contributions — employees: 5% of relevant income between the minimum and maximum relevant income levels · checked 2026-10-12
Estimate. Not tax advice. The verification badge means the model reproduces the stated formula through 6 self-test cases; the sources support that the formula matches the rules.
Check the arithmetic yourself: how this calculator is verified — the formula behind every derived value, the 6 test cases the engine reproduces, and what the badge does and does not claim. Also available as machine-readable JSON.
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