Hong Kong introduces one-off tax cut for 2024/25 tax year

A 100% reduction in profits tax, salaries tax, and tax under personal assessment has been proposed.

Hong Kong’s Financial Secretary unveiled a series of tax relief measures in the 2025 Budget, aimed at easing financial burdens for individuals and businesses, including a one-off tax reduction for the 2024/25 financial year.

A 100% reduction in profits tax, salaries tax, and tax under personal assessment has been proposed for the 2024/25 tax year, capped at $1,500 per case, which is expected to benefit 2.14 million salary taxpayers and 165,400 businesses, whilst reducing government revenue by $3.1b.

Taxpayers will still need to file their tax returns as usual, with the reduction applied during the final tax assessment.

The tax reduction, however, will not apply to provisional tax payments for the same year. Taxpayers must continue to pay their provisional tax on time, as it will later be offset against their final tax for 2024/25 and the provisional tax for 2025/26.

Additionally, the relief does not cover property tax, but individuals earning rental income may qualify under personal assessment.

To expedite the implementation, the Stamp Duty (Amendment) Bill 2025 will be introduced in the Legislative Council, whilst the Chief Executive has issued an order under the Public Revenue Protection Ordinance to ensure the measure takes effect immediately.