Stamp Duty Computation Form (Property) Hong Kong

A Stamp Duty Computation Form (Property) in Hong Kong captures the particulars required for the filing or submission it supports.

The Stamp Duty Ordinance (Cap. 117) imposes stamp duty on instruments executed in respect of Hong Kong property transactions. Head 1 of the First Schedule to Cap. 117 sets out the AVD scales for residential and non-residential property. Section 29CA of Cap. 117 introduced Buyer's Stamp Duty (BSD) in 2012. Section 29B of Cap. 117 previously governed Special Stamp Duty (SSD), which was abolished by the Stamp Duty (Amendment) (No. 2) Ordinance 2024. The Inland Revenue Department (IRD) — the Hong Kong tax authority under the Inland Revenue Department Ordinance — administers stamp duty collection and assesses the duty payable on each instrument presented for stamping. Stamp duty must generally be paid within 30 days of the execution of the agreement for sale and purchase, or within 30 days of the instrument first being brought into Hong Kong if executed outside Hong Kong under Section 14 of Cap. 117.

Ad valorem stamp duty (AVD) is the primary stamp duty on property transactions in Hong Kong. AVD is calculated as a percentage of the higher of the stated consideration or the market value of the property as assessed by the Stamp Office. The applicable AVD scale depends on the buyer's status and circumstances: Scale 1 (general rate, with progressive rates from 1.5% to 8.5% across the bands set out in Head 1 of the First Schedule to Cap. 117) applies to most transactions, while the concessionary Scale 2 (lower rates, from HK$100 to 4.25%) applies where eligible Hong Kong permanent residents meeting specific conditions purchase their first residential property.

Buyer's Stamp Duty (BSD) of 15% was introduced in October 2012 under Section 29CA of Cap. 117 as a demand management measure for the residential property market approved by the Legislative Council of Hong Kong. BSD applies to residential property purchases by non-Hong Kong permanent residents, companies, and Hong Kong permanent residents who already own other residential property. Following the Government's relaxation measures announced in the 2024-25 Budget, the scope of BSD exemptions was broadened. Buyers should verify the current position at the time of their transaction with their solicitor or the IRD.

Special Stamp Duty (SSD) under the former Section 29B of Cap. 117 was an anti-speculation measure that imposed additional duty on residential property re-sold within short holding periods. Following the February 2024 relaxation announced by the Financial Secretary pursuant to the Public Finance Ordinance (Cap. 2), SSD was abolished. The stamp duty computation form should reflect the applicable duties at the time of the specific transaction.

Hong Kong's stamp duty regime under Cap. 117 is administered by the Inland Revenue Department (IRD), which maintains an e-Stamping portal for online submission and payment of stamp duty on property instruments. The IRD may assess duty on the open market value if the stated consideration appears below market value — a particular concern in related-party transactions. Buyers should obtain a professional valuation from a Member of the Hong Kong Institute of Surveyors (HKIS) or a Fellow of the Royal Institution of Chartered Surveyors (RICS) where the consideration may be challenged by the Stamp Office.

A Hong Kong Stamp Duty Computation Form is needed whenever a person is purchasing, selling, or leasing Hong Kong property and needs to calculate the total stamp duty liability before signing the provisional agreement for sale and purchase (PASP) or tenancy agreement. Knowing the stamp duty cost in advance is critical for financial planning and for confirming that sufficient funds are available to settle the duty within the statutory 30-day payment deadline.

Residential property buyers need a stamp duty computation before making an offer or signing a PASP. For a buyer who is not a Hong Kong permanent resident, or who already owns another residential property, the BSD of 15% on top of the AVD represents a very substantial transaction cost — on a HK$10 million property, BSD alone is HK$1.5 million. Accurate pre-transaction computation prevents costly surprises at the point of stamping.

Hong Kong permanent resident buyers who qualify for the concessionary Scale 2 AVD rates benefit significantly from a lower duty rate compared with non-HKPR buyers, and the computation form enables them to confirm and document their eligibility for the concessionary rate before signing.

Commercial property buyers — purchasing offices, retail units, industrial premises, or car parks — need a stamp duty computation because non-residential transactions have different AVD rates to residential transactions, and BSD does not apply to non-residential property. Understanding the different treatment is important for structuring commercial acquisitions.

Property sellers whose buyers are non-HKPRs or companies need to understand the stamp duty burden their buyers face, as this affects negotiation of the net transaction price and can be a factor in deal structuring.

Property investors calculating the total cost of acquisition — purchase price, legal fees, agent commission, stamp duty, and initial renovation costs — need accurate stamp duty computations as an input to their investment return analysis.

Solicitors handling conveyancing transactions use stamp duty computation forms as a standard step in their pre-exchange client advice. The computation form confirms the client is fully informed of the stamp duty obligation and the required payment timeline before exchanging contracts.

Property solicitors preparing stamp duty computations as part of pre-exchange advice must apply the correct duty scale in force at the date of execution of the provisional agreement for sale and purchase (PASP) or tenancy agreement. The Inland Revenue Department's e-Stamping portal allows electronic payment and submission of stamp duty returns, and provides an online stamp duty calculator that can be used to verify computations before the formal instrument is submitted for stamping.

A complete Hong Kong Stamp Duty Computation Form must accurately capture all the relevant transaction details and apply the correct duty scales under the Stamp Duty Ordinance (Cap. 117) to arrive at the total stamp duty payable.

The property details section must identify the property being transacted: full address, lot reference (if known), and nature of property (residential, commercial, industrial, car park). The distinction between residential and non-residential property is critical because different AVD scales apply — residential transactions attract the higher residential AVD rates (Scale 1 or Scale 2), while non-residential transactions attract the separate non-residential scale.

The consideration or market value must be stated. AVD is charged on the higher of the stated consideration (the purchase price agreed between parties) and the open market value as assessed by the IRD. Where the consideration appears below market value (particularly in related-party transactions), the IRD will assess duty on the market value. For arm's length transactions, the consideration is typically accepted as the duty base.

The buyer's status for AVD purposes must be determined. The computation must establish whether the buyer is: a Hong Kong permanent resident (HKPR) eligible for Scale 2 concessionary rates; a HKPR who already owns another residential property (Scale 1 rates); a non-HKPR individual; or a company. This status determination directly determines both the applicable AVD scale and BSD liability.

The AVD calculation must apply the correct rate bracket from the applicable scale to the consideration or market value. Both Scale 1 and Scale 2 have progressive rate structures — each bracket applying a different percentage to a different band of property value. The correct bracket for the specific transaction value must be identified.

The BSD assessment must determine whether BSD applies to the transaction (15% of the higher of consideration or market value for non-exempt buyers) and, if so, calculate the BSD amount separately from the AVD.

For tenancy agreement stamp duty, the computation must determine the applicable rate based on the term of the lease (the three rate bands under Cap. 117: up to 1 year, 1–3 years, and over 3 years) and calculate the duty on the relevant rent base. Key money paid by the tenant to the landlord in addition to rent is included in the rent base for duty calculation purposes, which can significantly increase the duty payable.

The stamping procedure requires the instrument to be presented to the IRD within 30 days of execution. Late stamping attracts a penalty of up to ten times the unpaid duty under Cap. 117. An unstamped instrument is inadmissible as evidence in Hong Kong court proceedings — a critical issue for landlords seeking to recover vacant possession through the District Court or Lands Tribunal.

The total stamp duty is the sum of all applicable components. The form should clearly show each component separately — AVD, BSD — and the aggregate total, as well as the payment deadline (30 days from execution). Where the transaction involves related parties, the IRD's approach to market value assessment should be documented in the computation. The forms-legal.com Stamp Duty Computation Form is designed for Hong Kong property transactions under Cap. 117 and should be used in conjunction with the Provisional Agreement for Sale and Purchase and related conveyancing documents available on the platform. The computation should also confirm the payment mechanism — payment via IRD's e-Stamping portal is the preferred method for most transactions, with same-day or next-day stamping confirmation issued electronically.