Salaries Tax Return (BIR60) Hong Kong

A Salaries Tax Return (BIR60) in Hong Kong sets out the income, deductions, and tax position to be reported to the authority.

Hong Kong salaries tax is levied under Part III of the Inland Revenue Ordinance (Cap. 112) on every person deriving income in Hong Kong from employment, including salaries, wages, director's fees, leave pay, commission, bonuses, allowances, perquisites, and other benefits from employment. The charge applies on the basis of the territorial source of the income — income arising in or derived from Hong Kong — without reference to the individual's nationality, domicile, or residency. An expatriate employee working partly in and partly outside Hong Kong is taxed only on the Hong Kong-apportioned portion of their salary, under the time-apportionment concession described in the IRD's Departmental Interpretation and Practice Notes (DIPN). The DIPN set out the IRD's interpretation of Cap. 112 and are relied upon by tax practitioners and the Board of Review (Taxation) in resolving disputes.

The IRD issues the BIR60 to individuals who are known to have employment income in Hong Kong, primarily through the data reported by employers in their annual Employer's Returns (BIR56A) and individual employee notification forms (IR56B, IR56E). The BIR60 is issued in May each year, and the standard filing deadline is one month from the date of issue. Registered tax representatives — Certified Public Accountants registered with the Hong Kong Institute of Certified Public Accountants (HKICPA) and tax agents — may obtain extended deadlines under the IRD's block extension scheme. Individuals who wish to elect for personal assessment must make the election annually on the BIR60.

Two alternative tax rates apply under the salaries tax system. Progressive rates under the standard scale start at 2% and increase in bands of 6%, 10%, and 14%, up to a marginal rate of 17% on the highest band of income. The standard rate of 15% applies to total income without deducting personal allowances — if the progressive rate produces a higher liability than the standard rate applied to total income, the taxpayer is assessed at the lower (standard rate) amount. Section 12B of the Inland Revenue Ordinance (Cap. 112) governs the standard rate election, and Section 13 of Cap. 112 sets out the source rules determining when employment income is treated as arising in Hong Kong. Section 51 of Cap. 112 imposes the filing obligation on individuals who receive a BIR60 from the Inland Revenue Department. Most higher-income individuals with simple tax profiles are assessed at the standard rate, while lower-income individuals and those with dependent family members benefit from the progressive rates and personal allowances under the schedules administered by the Commissioner of Inland Revenue. The Board of Review (Taxation) and the Court of First Instance hear appeals from taxpayers who dispute assessments raised by the Inland Revenue Department.

The Inland Revenue Ordinance (Cap. 112) provides a wide range of personal allowances that reduce assessable income before the progressive rates are applied: the basic allowance (currently HK$132,000); the married person's allowance (HK$264,000); child allowances; dependent parent and grandparent allowances; single parent allowance; and disabled dependant allowances. The allowance amounts are revised annually by the Financial Secretary in the Budget and are subject to Legislative Council approval under section 12C of Cap. 112. Mandatory Provident Fund (MPF) employee contributions under the Mandatory Provident Fund Schemes Ordinance (Cap. 485) are also deductible from assessable income, subject to an annual cap.

A Hong Kong Salaries Tax Return (BIR60) must be filed by every individual who receives the form from the Inland Revenue Department, regardless of whether the individual believes any tax is payable. The obligation to file arises from the receipt of the BIR60, not from the individual's assessment of their own tax liability.

An employee working in Hong Kong under an employment contract with a Hong Kong or non-Hong Kong employer who receives a BIR60 from the IRD must file the return by the deadline. This applies to Hong Kong permanent residents and non-permanent residents alike, to full-time and part-time employees, and to both lower-income and higher-income workers.

An expatriate employee who performs services partly in Hong Kong and partly outside Hong Kong during the year of assessment must file the BIR60 and claim the time-apportionment deduction to reduce their Hong Kong salaries tax liability to reflect only the Hong Kong-sourced portion of their remuneration. Accurate records of days spent in and outside Hong Kong during the year of assessment are essential for preparing this claim.

A person who receives director's fees from a Hong Kong company — whether or not they are a resident of Hong Kong — is subject to salaries tax on those fees. The IRD issues a BIR60 to known directors of Hong Kong companies based on the data reported by companies in their annual profits tax returns and employer's returns.

A person who earns rental income from a property in Hong Kong pays property tax separately on that rental income. However, a person who chooses to make a personal assessment election can aggregate the rental income with their employment income and offset any net loss or deductions against the combined income, potentially reducing the overall tax liability. The personal assessment election is made on the BIR60.

A person who has left Hong Kong permanently — typically notified through the employer's IR56G form filed at least one month before departure — will receive a final BIR60 covering the year of departure. The IRD will issue a tax clearance letter once the final assessment is settled. Employers withhold the departing employee's final month's salary until the IRD confirms that the employee's tax affairs are in order.

A complete and accurate Hong Kong Salaries Tax Return (Form BIR60) under section 51 of the Inland Revenue Ordinance (Cap. 112) requires the taxpayer to provide the following key information.

Personal particulars: the taxpayer's full name in English and Chinese; Hong Kong Identity Card (HKID) number; date of birth; residential address in Hong Kong; marital status; and, if married, the name and HKID of the spouse and whether the spouse is separately assessed or has elected for joint assessment under section 10 of Cap. 112. The HKID number is the primary identifier used by the Inland Revenue Department to match the BIR60 against employer returns (IR56B) filed by the employer.

Employment income disclosure: all income from every employment in Hong Kong during the year of assessment (1 April to 31 March) must be declared. For each employment: name and address of the employer; period of employment; total gross remuneration including salary, bonuses, commissions, and director's fees; taxable value of employer-provided housing (cash allowances plus the IRD's deemed rental value formula for employer-provided accommodation); share option benefits exercised or share awards vested during the year under section 9(1)(d) of Cap. 112; and any termination payments or ex-gratia payments received on cessation of employment.

Personal allowances: the basic allowance (currently HK$132,000 under the current year's schedule); married person's allowance (HK$264,000); child allowances; dependent parent allowances; dependent grandparent allowances; single parent allowance; and disabled dependant allowances. Allowance amounts are adjusted annually by the Financial Secretary in the Budget under section 12C of Cap. 112 and require Legislative Council approval. A taxpayer whose allowances exceed their assessable income will have no salaries tax liability for that year of assessment.

Deductible expenses: mandatory MPF contributions by the employee under the Mandatory Provident Fund Schemes Ordinance (Cap. 485), subject to the annual deductible cap; home loan interest on a self-occupied Hong Kong residential property (deductible under section 26E of Cap. 112 for up to 20 years of assessment, subject to the annual cap); self-education expenses for approved courses under section 26B of Cap. 112; approved charitable donations under section 26D of Cap. 112 (capped at 35% of assessable income); elderly residential care expenses; and qualifying annuity premiums and tax-deductible MPF voluntary contributions introduced by the IRD to encourage retirement savings.

Personal assessment election: the BIR60 includes an election section for personal assessment under Part VII of Cap. 112, enabling aggregation of employment income, business profits, and property rental income for assessment at progressive rates. The election must be made annually and is not automatically carried forward from the previous year of assessment. A married couple may elect for joint personal assessment under section 41 of Cap. 112 where one spouse has no assessable income or where combined allowances reduce the joint tax liability.

Time-apportionment claim: expatriate employees performing services partly in Hong Kong and partly outside Hong Kong must state total employment days and Hong Kong days for the year of assessment, enabling the IRD to apply the time-apportionment concession. Double Taxation Agreements (DTAs) between Hong Kong and partner jurisdictions including mainland China (the Arrangement Concerning Double Taxation between Hong Kong and mainland China), the United Kingdom, Ireland, Japan, France, Germany, and Singapore may provide additional relief where income is taxed in both jurisdictions.

The free Salaries Tax Return (BIR60) guide at forms-legal.com helps Hong Kong employees understand their filing obligations under Cap. 112. Salaries tax is assessed by the Inland Revenue Department; the taxpayer receives a notice of assessment and may object within 1 month under section 64 of Cap. 112.

Completing and filing the Salaries Tax Return (Form BIR60) in Hong Kong involves working through each section of the form methodically, then lodging it with the Inland Revenue Department through the eTAX portal or by paper submission before the deadline.

Step 1 — Collect the BIR60 and note the deadline. The Inland Revenue Department issues the BIR60 in May each year. The standard lodgement deadline is one month from the date of issue printed on the form. Registered tax representatives may obtain an extended deadline through the IRD's Block Extension Scheme. Mark the deadline and set a reminder at least two weeks before it falls.

Step 2 — Complete personal particulars. Enter the full legal name in English and Chinese exactly as shown on the Hong Kong Identity Card (HKID). Record the HKID number — the primary identifier the IRD uses to match the BIR60 against the employer's IR56B. State residential address, date of birth, marital status, and, if married, the spouse's name and HKID and whether joint assessment under Section 10 of the Inland Revenue Ordinance (Cap. 112) is elected.

Step 3 — Declare all employment income. For every employment held during the year of assessment (1 April to 31 March), enter the employer's name and address, the period of employment, and total gross remuneration — salary, wages, bonuses, commissions, director's fees, and allowances — before any MPF deduction. Add the taxable value of employer-provided housing: cash housing allowances at face value, plus employer-provided accommodation at 10% of assessable income using the IRD's standard formula under Section 9(1)(d) of Cap. 112. Report share option benefits exercised and share awards vested during the year.

Step 4 — Claim deductible expenses and contributions. Deduct mandatory MPF employee contributions under the Mandatory Provident Fund Schemes Ordinance (Cap. 485), subject to the annual cap. Claim home loan interest on a self-occupied Hong Kong residential property under Section 26E of Cap. 112 (up to 20 years, subject to annual cap). Enter approved charitable donations under Section 26D (capped at 35% of assessable income), self-education expenses for approved courses under Section 26B, and qualifying annuity premiums and tax-deductible MPF voluntary contributions introduced by the IRD.

Step 5 — Claim personal allowances. Enter each applicable allowance: basic allowance (currently HK$132,000); married person's allowance (HK$264,000); child allowances; dependent parent and grandparent allowances; single parent allowance; and disabled dependant allowances. Allowance amounts are set annually by the Financial Secretary under Section 12C of Cap. 112.

Step 6 — Complete the time-apportionment section if applicable. Expatriate employees who performed services partly in Hong Kong and partly outside during the year state total employment days and Hong Kong days for the IRD to calculate the taxable apportioned portion. Attach travel records, flight confirmations, or employer-issued itinerary summaries to support the claim. Where a Double Taxation Arrangement applies — for example, with mainland China, the United Kingdom, or Singapore — complete the CDTA relief section.

Step 7 — Elect for personal assessment if beneficial. Complete the personal assessment election section under Part VII of Cap. 112 to aggregate employment income with business profits and property rental income, enabling offsetting of losses and mortgage interest deductions across income sources. The election must be made each year — it is not automatically carried forward.

Step 8 — Sign the declaration and lodge. Sign and date the completed BIR60, confirming all information is true and complete. False returns constitute a criminal offence under Section 82 of Cap. 112. File the return through the Inland Revenue Department's eTAX portal for electronic submission, or return the paper form to the Inland Revenue Department at Revenue Tower, 5 Gloucester Road, Wan Chai. Retain a copy of the submitted return and any receipts.

Fees and penalties. No filing fee applies. Late lodgement may result in estimated assessments and prosecution under Section 80 of Cap. 112. On receiving a notice of assessment, lodge a written objection under Section 64 within one month if the assessment is disputed.