Tenancy Renewal Agreement (Hong Kong)

A Tenancy Renewal Agreement in Hong Kong governs the letting of property and fixes the rent, term, and maintenance duties of each party.

Since the repeal of Part IV of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7) in 2004, Hong Kong domestic tenants have no statutory right of renewal. Before the 2004 amendment, Part IV conferred security of tenure and a right to renew at market rent for residential tenants. Following full repeal, the landlord-tenant relationship at renewal is governed entirely by contract: the landlord is free to decline renewal, demand a higher rent, or insist on different conditions, and the tenant has no legal recourse if renewal is refused. A contractual option to renew in the original tenancy agreement is the only mechanism that obliges the landlord to grant a renewal.

The Tenancy Renewal Agreement is a new instrument for stamp duty purposes under the Stamp Duty Ordinance (Cap. 117) — it must be stamped within 30 days of execution regardless of whether the terms are identical to the original tenancy. An unstamped renewal agreement is inadmissible as evidence in civil proceedings before the District Court or Lands Tribunal, meaning neither party can enforce their rights under the renewed tenancy without first paying the overdue stamp duty and any applicable penalties.

For commercial tenancies, there is likewise no statutory security of tenure or renewal right in Hong Kong — commercial tenancies are governed entirely by the agreement between landlord and tenant, and the common law of contract applies. The renewal of commercial leases (offices, retail premises, warehouses, industrial units) follows the same contractual principles as residential renewals, with stamp duty obligations under Cap. 117 calculated on the same scale.

Forms Legal provides a free Hong Kong Tenancy Renewal Agreement template covering residential and commercial renewal arrangements, compliant with Cap. 7 and Cap. 117. Available as PDF and Word download.

The distinction between a tenancy renewal and a tenancy continuation by holding over is commercially significant for both landlords and tenants. A formal renewal agreement provides a fixed end date, documented terms, and a stampable instrument under Cap. 117. A periodic tenancy arising from holding over provides only month-to-month certainty, creating risk for landlords (who cannot plan the premises for a specific future date) and tenants (who have no security beyond one month's notice). Executing a Tenancy Renewal Agreement promptly at or before the expiry of the current term is in the interests of both parties.

The Tenancy Renewal Agreement in Hong Kong is prepared by the landlord's solicitors and reviewed by the tenant's solicitors before execution. Both parties should verify that the renewed tenancy terms accurately reflect the commercial agreement reached — including the new rent, the term, any rent-free period, reinstatement obligations, and permitted use. For commercial tenancies, the renewed agreement may need to be disclosed to the tenant's lender if the tenant has granted a fixed charge over its leasehold interest. The Stamp Duty Ordinance (Cap. 117) requires the renewed tenancy to be stamped within 30 days of execution at a rate based on the annual rent — failure to stamp attracts a penalty of up to 10 times the original stamp duty payable.

Section 6 of the Stamp Duty Ordinance (Cap. 117) sets out the head of charge applicable to leases and agreements for leases of immovable property in Hong Kong. For a tenancy renewal with a term not exceeding one year, stamp duty is 0.25% of the total rent payable. For terms between one and three years, the rate is 0.5% of the average annual rent. For terms exceeding three years, the rate is 1% of the average annual rent. Section 14 of Cap. 117 provides that an instrument not duly stamped is inadmissible as evidence in civil proceedings — a party seeking to enforce the renewed tenancy before the Lands Tribunal, the District Court, or the Court of First Instance cannot rely on an unstamped renewal agreement. The Inland Revenue Department's (IRD) e-Stamping Portal accepts electronic stamping of tenancy agreements and renewal agreements.

For commercial tenancy renewals, the Rating and Valuation Department's annual revaluation of all properties in Hong Kong for rating purposes (under the Rating Ordinance (Cap. 116)) may affect the government rent and rates payable on the property, which are often borne by the tenant under the tenancy agreement's outgoings clause. Landlords and tenants should confirm the current rateable value and rates liability when negotiating renewal terms. The Lands Registry (now the Land Registry) records all instruments lodged for registration under the Land Registration Ordinance (Cap. 128) — a tenancy renewal agreement with a term exceeding three years must be registered at the Land Registry to be effective against third parties under Section 3 of Cap. 128.

A Tenancy Renewal Agreement is needed whenever a landlord and tenant in Hong Kong agree to continue a tenancy beyond the expiry of the current fixed term. Specific circumstances where a formal written renewal is essential include the following.

Residential tenancy renewals: When the fixed term of a domestic tenancy (typically 1 or 2 years in Hong Kong) expires and both parties wish to continue the arrangement, a written renewal agreement should be executed. The renewal documents the new term, the agreed rent (including any increase), whether the security deposit requires a top-up, and any other varied terms. Without a written renewal, the tenant's continued occupation creates a periodic tenancy by operation of law — typically a month-to-month tenancy on the same terms as the original — but this provides significantly less security and clarity than a fixed-term renewal.

Commercial lease renewals: Office, retail, and industrial tenants approaching the end of a fixed-term commercial lease should negotiate renewal terms well in advance — typically 3 to 6 months before expiry. Commercial landlords in Hong Kong commonly conduct formal rent reviews at renewal, benchmarked against current market rates. A written renewal agreement documents the new rent, revised break clauses, updated maintenance obligations, and any capital improvement commitments by the landlord.

Exercising a contractual option to renew: Where the original tenancy agreement contains an option to renew, the tenant must exercise the option strictly in accordance with its terms — within the specified notice period, in the specified manner, and at the specified rent (which may be fixed or market-reviewed). A formal renewal agreement should then be executed to document the renewed tenancy, even where the option terms are self-executing.

Holding over situations: Where a tenant holds over after expiry — continuing to pay rent and occupy the premises — and the landlord accepts rent, a periodic tenancy arises. To convert this uncertain position into a fixed-term arrangement, both parties should execute a formal renewal agreement as soon as possible. The renewal should specify its start date and address any period of holding over.

Stamp duty compliance: A formal written renewal agreement must be stamped within 30 days of signing under Cap. 117. Executing a formal renewal (rather than relying on a periodic tenancy) confirms both parties have an enforceable, admissible instrument.

Commercial tenants at the end of a fixed term should also consider whether any Deed of Mutual Covenant (DMC) binding the building imposes restrictions on the use or alteration of the premises that affect the renewal terms — for example, if the tenant's business use has changed during the original term. Section 41 of the Conveyancing and Property Ordinance (Cap. 219) governs the benefit and burden of covenants in leases — covenants that touch and concern the land pass to and bind successors in title and are relevant to renewal negotiations where the landlord has changed ownership during the original term.

A Hong Kong Tenancy Renewal Agreement must contain all particulars required to identify the parties, the property, and the renewed terms, and to comply with stamp duty obligations under the Stamp Duty Ordinance (Cap. 117). Forms Legal's template covers the following essential elements.

Parties: Full legal names and identification of the landlord and tenant — HKID number for individual parties, Company Registration Number and registered office address for corporate parties. Both parties must be correctly identified to confirm the renewal agreement is enforceable.

Reference to original tenancy: Date, parties, and property description of the original tenancy agreement being renewed. Where the original tenancy has been varied or previously renewed, reference each instrument in sequence to establish the full contractual history.

Property description: Full postal address; floor and unit number; approximate usable or saleable area; and any car parking spaces, storage rooms, or other areas included in the tenancy.

Renewed term: Precise start date (the day after the current term expires) and end date of the renewed term. For residential tenancies, terms of 1 or 2 years are most common in Hong Kong. For commercial tenancies, 2 to 3 year terms are typical, sometimes with a mid-term break clause.

Rent: Monthly rent for the renewed term, expressed in Hong Kong Dollars (HKD). If the rent is increasing from the original tenancy, the new rent must be clearly stated. Where the original tenancy includes a Government rates contribution or management fee, clarify whether these amounts are included in or in addition to the stated monthly rent.

Security deposit: Whether the existing security deposit (typically 2 months' rent for residential tenancies) is sufficient for the renewed term or requires a top-up to reflect the new rent level. The top-up amount and payment date should be specified.

Amended terms: Any terms of the original tenancy that the parties wish to vary for the renewed period — for example, updated break clauses, revised repair and maintenance obligations, or adjusted permitted use provisions.

Continuing terms: An express confirmation that all terms of the original tenancy agreement not specifically amended by the renewal agreement remain in full force and effect for the renewed term.

Stamp duty: Express allocation of stamp duty obligations between landlord and tenant; confirmation of the obligation to stamp within 30 days of execution under Cap. 117; and the applicable stamp duty rate (0.25% for terms up to 1 year; 0.5% of average annual rent for 1–3 years; 1% for over 3 years).

Governing law: Laws of the Hong Kong Special Administrative Region, with disputes subject to the jurisdiction of the Lands Tribunal (for residential tenancy disputes) or the District Court or Court of First Instance (for higher-value commercial disputes).

Break clauses: Whether either party should have the right to terminate the renewed tenancy before the end of the fixed term upon giving a specified period of notice. Break clauses are common in commercial tenancy renewals in Hong Kong, where business conditions can change rapidly. For residential renewals, break clauses are less common but may be appropriate where the tenant's employment situation is uncertain.

Forms Legal provides a free Tenancy Renewal Agreement template for Hong Kong, compliant with the Landlord and Tenant (Consolidation) Ordinance (Cap. 7) and the Stamp Duty Ordinance (Cap. 117). Available as PDF and Word download.

Execution and witnessing: Both landlord and tenant must sign the renewal agreement. For corporate parties, execution requires the signature of an authorised officer and the company chop. Witnessed execution is not a legal requirement for a tenancy renewal under Hong Kong law, but is recommended for evidentiary purposes if the agreement is later disputed before the Lands Tribunal. The forms-legal.com Tenancy Renewal Agreement (Hong Kong) template covers the mandatory elements under Landlord and Tenant (Consolidation) Ordinance (Cap. 7).

Land Registry Registration: Under Section 3 of the Land Registration Ordinance (Cap. 128), a lease or tenancy agreement for a term exceeding 3 years must be registered at the Land Registry (formerly the Lands Registry) within 1 month of execution, or within such extended period as the Land Registrar may allow. An unregistered lease for a term exceeding 3 years is void against a bona fide purchaser of the legal estate who acquires the property without actual notice of the lease. For shorter residential and commercial tenancy renewals (1 to 2 year terms, most common in Hong Kong), registration at the Land Registry is not required but stamping under Cap. 117 remains mandatory within 30 days. The Inland Revenue Department (IRD) administers stamping and the IRD e-Stamping Portal enables online submission. Section 44 of Cap. 117 provides for assessment of stamp duty by the Collector of Stamp Revenue where the parties dispute the correct duty. The forms-legal.com Tenancy Renewal Agreement template covers all elements required under Cap. 7 and Cap. 117.