What is Stamp Duty (Hong Kong)?
Hong Kong Stamp Duty is a transactional tax charged on instruments relating to the sale or transfer of Hong Kong stock and immovable property. Share transfers attract 0.1% from buyer and 0.1% from seller (0.2% total). Residential property attracts Additional Buyer's Stamp Duty (15%) for non-permanent residents and companies, plus scale Ad Valorem Duty.
Current Rate (1 April to 31 March)
Shares: 0.2% total (0.1% each party). Property: 1.5%-4.25% AVD; 15% ABSD for companies and non-PRs.
Example
A company buys HKD 1M of HK-listed shares from an individual. Buyer pays stamp duty of HKD 1,000 (0.1%); seller pays HKD 1,000 (0.1%). Total stamp duty = HKD 2,000, payable to the Stamp Duty Office within 2 days.
How Stamp Duty (Hong Kong) works in Hong Kong
**Types of Stamp Duty in Hong Kong**
Hong Kong Stamp Duty applies to written instruments for: (1) sale and purchase of shares in HK incorporated companies, and (2) sale and purchase of immovable property in HK. The Stamp Duty Ordinance (Cap. 117) governs the regime.
**Stamp Duty on shares**
For transactions in HK stock (shares in HK incorporated companies): - Buyer: 0.1% of the consideration or market value (whichever is higher) - Seller: 0.1% of the consideration - Total: 0.2% split equally between buyer and seller - Payment: within 2 days of the contract note for open market trades. For off-market transfers, the instrument of transfer must be stamped before registration. - The Inland Revenue Department maintains a Stamp Duty Calculator online.
**Ad Valorem Duty (AVD) on residential property**
Scale rates apply based on consideration: - Up to HKD 3M: 1.5% - HKD 3M to HKD 4M: 2.25% - HKD 4M to HKD 6M: 3% - HKD 6M to HKD 20M: 3.75% - Above HKD 20M: 4.25% Note: As of 28 February 2024, the government abolished Special Stamp Duty, Buyer's Stamp Duty, and reduced AVD to the above scale for eligible buyers. HK permanent residents acquiring their first residential property apply the lower scale. Corporate purchasers remain subject to higher rates.
**Additional Buyer's Stamp Duty (ABSD)**
As of the latest rules, a flat 15% ABSD applies to residential property purchased by: - Non-permanent residents of Hong Kong - Companies (regardless of whether their shareholders are HK residents) - Permanent residents acquiring a second or subsequent residential property
For a HKD 5M property purchased by a company: AVD of approximately HKD 187,500 plus ABSD of HKD 750,000. Total stamp duty = HKD 937,500 (18.75% effective rate). This makes corporate property ownership extremely costly and most corporate buyers structure property through individuals rather than companies.
**Special Stamp Duty (SSD)**
SSD was the anti-speculation tax on residential properties resold within 24 months of purchase (rates up to 20%). SSD was abolished from 28 February 2024 following the government's property market support measures.
**Non-residential property**
Commercial and industrial properties attract a flat AVD of 4.25% regardless of buyer identity (no additional ABSD). However, a New Residential Stamp Duty (NRSD) of 15% applies to certain developments.
Related terms
Hong Kong Profits Tax is levied on assessable profits arising in or derived from Hong Kong. Since 2018 a two-tier regime applies: 8.25% on the first HKD 2 million of assessable profits, then 16.5% above that. Only one entity per related group can benefit from the lower 8.25% rate.
Hong Kong Property Tax is charged at 15% on the net assessable value (NAV) of HK properties let out by their owners. NAV is the total rent received in the year, less rates paid by the owner, less a statutory 20% deduction for maintenance and repairs.
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