Hong Kong SAR's headline corporate income tax (CIT) rate is 16.5% corporations; 15% unincorporated businesses.
The headline personal income tax (PIT) rate is 16.
0% - Hong Kong has no VAT, GST, or general sales tax; government revenue relies on profits tax, salaries tax, and stamp duty instead.
Hong Kong operates a territorial basis of taxation: liability turns on the source of income, not on residence or domicile, so residency status does not by itself determine whether income is taxable. Residency still matters for accessing double tax treaty relief. A company is generally Hong Kong tax resident if incorporated there, or if incorporated elsewhere but normally managed and controlled ("central management and control," a factual test - board meeting location, where top executives exercise authority, location of accounting records) in Hong Kong. An individual is resident if they ordinarily reside in Hong Kong (a permanent home with some degree of continuity - a qualitative test, not a day count) or stay more than 180 days in a year of assessment, or more than 300 days across two consecutive years.
Hong Kong has no Controlled Foreign Company regime.
Hong Kong has no thin capitalization rules. Interest deductibility instead follows specific statutory deductibility conditions and general anti-avoidance provisions rather than a debt-to-equity test. Since the Foreign Sourced Income Exemption (FSIE) regime took effect in January 2023, certain foreign-sourced passive income (interest, dividends, disposal gains) can become taxable in Hong Kong if not properly structured or substantiated as genuinely foreign - a meaningful exception to the territorial principle worth flagging for any foreign passive income analysis.
Hong Kong has signed Comprehensive Double Taxation Agreements (CDTAs) with roughly 45-51 jurisdictions (sources vary slightly by date; confirm the current count via the Inland Revenue Department before relying on an exact figure), with further jurisdictions in negotiation. Many CDTAs are modified by the OECD's Multilateral Instrument (MLI), adding anti-abuse measures including the Principal Purpose Test.