Hong Kong

Research notes

Hong Kong — family-office tax dossier

Last reviewed: 2026-10-16 Tax year: 2026/27 Reviewer: research agent (Claude), unreviewed by a tax adviser

Summary

Hong Kong taxes individuals only on Hong Kong-source employment, business and property income. Capital gains and dividends (Hong Kong or foreign) received by an individual investor are not taxed, estate duty was abolished for deaths from 11 February 2006, and there is no gift or wealth tax. The residual costs are stamp duty (0.2% on Hong Kong share transfers, up to 6.5% on property), progressive government rates on homes, and the absence of a tax treaty with the US (US dividends bear 30% US withholding). The New Capital Investment Entrant Scheme (HKD 30 million) is the main residence route for investors.

US citizens: US citizens remain US-taxed on worldwide income; there is no US-Hong Kong income tax treaty, and Hong Kong levies nothing on investment income, so the US federal layer is the whole tax. An FIHV or Hong Kong company owned by a US person is likely a CFC/PFIC.

Residence and eligibility

Domestic tax liability does not depend on residence, domicile or citizenship. For treaty purposes an individual is resident if ordinarily residing in Hong Kong, or staying more than 180 days in a year of assessment or more than 300 days in two consecutive years.

• New Capital Investment Entrant Scheme (New CIES) (EU, US, OTHER): Net assets of at least HKD 30 million (from 1 March 2025 assessed over the 6 months before application, jointly owned family assets count pro rata) and investment of HKD 30 million in permissible Hong Kong assets within 6 months; can be held through a wholly owned private company including an FIHV. From 1 November 2026, only assets transacted through designated accounts count. Spouse and unmarried dependent children under 18 can accompany (general immigration rule; not verified here). The split between permissible assets, the CIES Investment Portfolio and real estate was not verified. Minimum investment: 30,000,000 HKD.

Capital gains

Standard regime

No capital gains tax. PwC: all capital gains derived by an individual are not subject to tax in Hong Kong. Gains that form part of a trade or business carried on in Hong Kong are taxed under profits tax.

• Exemptions and thresholds: Capital gains of any size are untaxed for a private investor.
• Important exceptions, statute references and announced changes: Profits tax applies if an individual carries on a trade of dealing in securities or property in Hong Kong. Stamp duty of 0.2% of consideration (shared buyer/seller) applies to transfers of Hong Kong stock. Special and buyer's stamp duties on property were reduced to 0% from 28 February 2024.
• Tax year / confidence / verification: 2026/27 / high / partially_verified (checked 2026-10-15)
• JSON numbers: headline 0% (0.0); listed domestic 0% (0.0); listed foreign 0% (0.0); private business sale 0% (0.0); local real estate 0% (0.0); foreign real estate 0% (0.0).
• How derived: Capital gains of individuals are outside the Inland Revenue Ordinance charge; 0% for a long-term private investor. Transaction stamp duty is not a gains tax and is excluded.
• Holding period: None.
• Trader recharacterisation: If the activity is a trade carried on in Hong Kong (frequent dealing with profit-seeking intent), the profits are assessable to profits tax. Badges-of-trade case law applies.
• Foreign assets: Gains on foreign assets are not taxed.

Dividends

Standard regime

Dividends derived by an individual are not taxed in Hong Kong, whether from Hong Kong or foreign companies. Foreign withholding tax is therefore a final cost.

• Exemptions and thresholds: All dividends exempt.
• Important exceptions, statute references and announced changes: No treaty with the United States: US dividends bear 30% US withholding for a non-US person resident in Hong Kong. The FSIE regime (from 2023) applies to multinational-group entities, not to individuals.
• Tax year / confidence / verification: 2026/27 / high / partially_verified (checked 2026-10-15)
• JSON numbers: headline 0% (0.0); domestic 0% (0.0); foreign gross 0% (0.0); foreign tax relief: exemption.
• How derived: Dividends are not chargeable to salaries, profits or property tax for an individual; 0%.
• Outbound withholding: No withholding tax on dividends or interest paid to non-residents.
• Treaty network: 58 comprehensive treaties per PwC (7 pending ratification), mostly Asia/Europe; none with the United States. Hong Kong residence is only relevant for treaty access (ordinarily resident, more than 180 days in a year, or more than 300 days over two years).
• Holding companies: Profits tax 16.5% (8.25% on the first HKD 2 million). A family-owned investment holding vehicle managed by an eligible single family office can be taxed at 0% on qualifying transactions (at least 2 full-time qualified employees and HKD 2 million of local operating expenditure).

Inheritance and gifts to children

Standard regime

No inheritance or gift tax. Estate duty was abolished by the Revenue (Abolition of Estate Duty) Ordinance 2005 with effect from 11 February 2006. Gifts of Hong Kong shares or property attract stamp duty on market value.

• Exemptions and thresholds: No tax on inheritances or gifts of any amount.
• Important exceptions, statute references and announced changes: Stamp duty on a gift (voluntary disposition inter vivos) of Hong Kong stock or property is charged on market value. Transfers on death by will or intestacy are not dutiable as gifts (general rule; not separately verified).
• Tax year / confidence / verification: 2026/27 / high / verified (checked 2026-10-15)
• JSON numbers: basis none, children fully_exempt, exemption 0 HKD, brackets (marginal): none; other transfer costs 0% (0.0).
• Gifts: None. Stamp duty applies to gifts of Hong Kong shares (0.2%) and Hong Kong property (ad valorem scale). (same as inheritance: True; tax-free after years: None)
• Foreign assets: No tax.
• Residence/domicile rules: Not applicable since 11 February 2006.
• Business relief covers listed shares: False

Wealth tax

Standard regime

No net wealth tax and no levy on financial assets.

• Tax year / confidence / verification: 2026/27 / high / verified (checked 2026-10-15)
• JSON type: none
• Property tax (not a wealth tax): Government rates on domestic property: 5% on the first HKD 550,000 of rateable value, 8% on the next HKD 250,000, 12% on the rest; plus government rent of 3% of rateable value on leased land. Property tax of 15% of net assessable value applies to let property only. Ad valorem stamp duty on purchases of residential property rises to 6.5% (above HKD 100 million).

Special regimes

None modelled; see Residence and eligibility.

Company taxation (kept separate from personal tax)

Headline CIT rate: 16.5% (0.165). Profits tax 16.5% (8.25% on the first HKD 2 million under the two-tier regime; one entity per connected group). Territorial: offshore profits are untaxed, but under the FSIE regime (from 2023, extended 2024) foreign dividends, interest and disposal gains received in Hong Kong by MNE group entities are taxed unless economic substance or participation requirements are met. Pillar Two: IIR and the Hong Kong minimum top-up tax apply from fiscal years beginning 1 January 2025. No dividend WHT. Special zones/regimes: 0% for eligible family-owned investment holding vehicles (FIHV) managed by a Hong Kong single family office (from 1 April 2022); the office must manage specified assets of at least HKD 240 million for the family's FIHVs, with at least 2 full-time qualified employees and HKD 2 million of Hong Kong operating expenditure (IRD, FIHV concession); fund exemption for qualifying private funds (from 2019).

Cost of living notes

City: Hong Kong.

• Prime rent, monthly: 124,000 HKD (2026). Median asking rent of 18 four-bedroom flats of about 1,360-2,840 sq ft saleable (about 125-265 m2) on OKAY.com, read 2026-10-15 (first results page only of each district): Tai Tam (10: Pacific View HKD 83,500-85,000; The Redhill Peninsula HKD 110,000-158,000), Pokfulam (Carrianna Sassoon 2,586 sq ft HKD 150,000), Mid-Levels West/Central/East (The Morgan HKD 103,000, Elegant Terrace 160,000, Kennedy Park 120,000, Borrett Mansions 120,000, 3 Macdonnell Road 160,000, United Mansion 78,000) and Happy Valley (Beverly Hill 78,000). Range HKD 78,000-160,000; 9th and 10th of 18 are HKD 120,000 and 128,000, midpoint 124,000. Excluded as trophy: the villa estates (Provident Villas, Felix Villas, Bel-Air on the Peak), The Summit, the Peak and Redhill units above 3,000 sq ft. Rents mostly inclusive of management fees. Replaces HKD 120,000 (7 flats) and the earlier derived HKD 92,800. Source: Properties for rent in Tai Tam (OKAY.com).
• Prime price per m²: not set (the earlier RVD Class E figure of HKD 253,460 covers luxury flats including the Peak, so it was cleared).
• International school, annual per child: 297,100 HKD (2026). Hong Kong International School, Grades 9-12, 2026-27: tuition HKD 136,300 per semester (HKD 272,600 a year) plus capital levy HKD 12,250 per semester (HKD 24,500 a year). One-time entry fee HKD 15,000 for new students. Source: Tuition and Fees.

Family health insurance and domestic helper costs were not sourced (the statutory Minimum Allowable Wage for foreign domestic helpers was not re-read in this pass).

Open questions

• New CIES investment split (permissible assets, CIES Investment Portfolio, real-estate cap) not verified from the Scheme Rules PDF.
• Profits tax rates for unincorporated businesses (individual traders) not verified in this session.
• Cost of living: prime rent derived from RVD Class E averages times an assumed 200 m2 flat (no agency rent level for 4-5 bedroom homes was opened); health insurance and helper wages not sourced.

Sources

• Hong Kong SAR - Individual - Income determination (PwC Worldwide Tax Summaries, professional): https://taxsummaries.pwc.com/hong-kong-sar/individual/income-determination
• Hong Kong SAR - Individual - Other taxes (PwC Worldwide Tax Summaries, professional): https://taxsummaries.pwc.com/hong-kong-sar/individual/other-taxes
• Hong Kong SAR - Corporate - Withholding taxes (PwC Worldwide Tax Summaries, professional): https://taxsummaries.pwc.com/hong-kong-sar/corporate/withholding-taxes
• Estate Duty (Inland Revenue Department, HKSAR, tax_authority): https://www.ird.gov.hk/eng/tax/edu.htm
• Hong Kong SAR - Individual - Residence (PwC Worldwide Tax Summaries, professional): https://taxsummaries.pwc.com/hong-kong-sar/individual/residence
• New Capital Investment Entrant Scheme (Invest Hong Kong, government): https://www.newcies.gov.hk/en/
• Enhancement measures to New CIES (press release, 7 January 2025) (HKSAR Government, government): https://www.info.gov.hk/gia/general/202501/07/P2025010600305.htm
• Hong Kong SAR - Corporate - Taxes on corporate income (PwC Worldwide Tax Summaries, professional): https://taxsummaries.pwc.com/hong-kong-sar/corporate/taxes-on-corporate-income
• Tax concession for family-owned investment holding vehicles (Inland Revenue Department, HKSAR, tax_authority): https://www.ird.gov.hk/eng/tax/bus_fihv.htm
• Private Domestic - Average Rents by Class (from 1982), monthly series up to August 2026 (Rating and Valuation Department, HKSAR Government, government): https://www.rvd.gov.hk/doc/en/statistics/his_data_1.xls
• Properties for rent in Mid-levels West (OKAY.com, other): https://www.okay.com/en/property-search/rent/mid-levels-west
• Tuition and Fees (Hong Kong International School, other): https://www.hkis.edu.hk/admissions/tuition-fees
• Properties for rent in Tai Tam, Pokfulam, Happy Valley (OKAY.com, other): https://www.okay.com/en/property-search/rent/tai-tam , https://www.okay.com/en/property-search/rent/pokfulam , https://www.okay.com/en/property-search/rent/happy-valley

Change log

• 2026-10-15: initial research.
• 2026-10-15: reviewed special-regime durations: no special regime.
• 2026-10-15 (data-quality pass): added cost of living for Hong Kong: prime rent HKD 92,800 a month (RVD Class E Hong Kong Island average rent Jan-Aug 2026, HKD 464/m2, times an assumed 200 m2 flat), prime price HKD 253,460 per m2 (RVD Class E Hong Kong Island, Jan-Aug 2026 average) and HKIS Grades 9-12 fee HKD 297,100 (2026-27 tuition plus capital levy).
• 2026-10-15: family rent re-checked against the upper-middle-class standard: changed from HKD 92,800 to HKD 120,000 (Mid-Levels and Happy Valley 4-bedroom flats); price per m² cleared as ultra-prime.
• 2026-10-15: family rent re-checked a second time: changed from HKD 120,000 (7 flats) to HKD 124,000 (18 four-bedroom flats in Tai Tam, Pokfulam, Mid-Levels and Happy Valley, trophy villas excluded).
• 2026-10-16: FIHV concession detail added to company taxation: HKD 240 million of specified assets managed by the single family office, 2 full-time qualified employees, HKD 2 million local expenditure (IRD page, accessed 2026-10-16).