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On 4 November 2016, the Government announced that the Stamp Duty Ordinance would be amended. The ad valorem stamp duty (AVD) rates for residential property transactions will be increased to a flat rate of 15%. All instruments executed on or after 5 November 2016 for the sale and purchase or transfer of residential property, will be subject to the proposed new AVD rate. Except for specifically exempted or provided otherwise, all transactions are subject to ad valorem stamp duty (AVD) rates of 15%.
First-time home buyers who are permanent residents will be exempted from the new rate. Thus, a Hong Kong permanent resident (act on behalf by other person) who does not own any other residential property in Hong Kong at the time of acquisition, the relevant instrument will still be subject to AVD at Scale 2.
The refund mechanism under the existing regime for HKPR buyer who changes his/her single residential property will also be retained.
Transactions relating to non-residential properties would not be affected by the change, subject to doubled ad valorem stamp duty (DSD).
AVD Rate at Scale 2 was as following:
Consideration exceeds
Consideration not exceeds
Tax rate
HK$0
HK$2,000,000
HK$100
HK$2,000,000
HK$2,351,760
HK$100＋10% of excess over $2,000,000
HK$2,351,760
HK$3,000,0000
1.5%
HK$3,000,000
HK$3,290,320
HK$45,000＋10% of excess over $3,000,000
HK$3,290,320
HK$4,000,000
2.25%
HK$4,000,000
HK$4,428,570
HK$90,000＋10% of excess over $4,000,000
HK$4,428,570
HK$6,000,000
3%
HK$6,000,000
HK$6,720,000
HK$180,000＋10% of excess over $6,000,000
HK$6,720,000
HK$20,000,000
3.75%
HK$20,000,000
HK$21,739,120
$750,000 + 10% of excess over $20,000,000
HK$21,739,120
~
4.25%
The above information was extracted from the press release of Hong Kong Inland Revenue Department. For more information, please visit the website:
