Navigating Hong Kong’s salaries tax requirements can feel overwhelming, especially for employers trying to fulfil reporting obligations while staying compliant. One of the most essential documents in this process is the BIR60 form, the standard tax return form Hong Kong uses to report individual income.
In this guide, we’ll explain what the BIR60 form is, how it works in the context of salaries tax return filing, and what employers need to know to support their teams during tax season — without missing any key deadlines or filing steps.
Understanding Salaries Tax in Hong Kong
Hong Kong operates a territorial tax system, meaning individuals are taxed only on income arising in or derived from Hong Kong. For employees, this includes income such as salaries, wages, commissions, bonuses, and allowances, all of which are reported under the salaries tax return.
Employers play a vital role in the tax return process in Hong Kong. Aside from reporting employee earnings to the Inland Revenue Department (IRD), they also need to ensure employees are aware of their filing obligations and deadlines.
Overview of the BIR60 Tax Form
The BIR60 form is the Individual Tax Return issued annually by Hong Kong’s IRD. It’s sent to most taxpayers around the first working day of May each year and covers the tax year that ended on 31 March. If you’ve earned assessable income during the year, you’re legally required to complete and return this form.
This tax return form in Hong Kong must be used by individuals, including employees, sole proprietors, and even landlords of rental property, to report income and claim deductions or allowances. While businesses handle employer returns separately, employees must complete their own BIR60 form to declare personal income accurately.
Key Deadlines for Submitting the BIR60 Form
Once issued, taxpayers typically have one month to complete and return the BIR60 form. However, extensions may be granted if filing online or in cases involving sole proprietorships. Key dates include:
- Form issuance: Around early May
- Standard filing deadline: One month after issue date
- E-filing deadline (without sole proprietorship): Mid-June
- E-filing deadline (with sole proprietorship): Mid-July
Submitting your salaries tax return on time helps avoid penalties and processing delays.
How to Calculate Salaries Tax in Hong Kong
In Hong Kong, salaries tax is calculated using two methods: the progressive tax rate system and the standard tax rate. The IRD will automatically assess your income using both methods and apply the lower amount as your final tax payable.
Using Progressive Rates
Under this method, tax is calculated in tiers based on net chargeable income (income after deductions and allowances). The more you earn, the higher the rate applied to the upper bands of your income.
Here’s a breakdown of the current progressive rates:
- First HK$50,000 – 2%
- Next HK$50,000 – 6%
- Next HK$50,000 – 10%
- Next HK$50,000 – 14%
- Remainder – 17%
Sample Calculation:
If your net chargeable income is HK$240,000, your tax would be calculated as:
- First HK$50,000 × 2% = HK$1,000
- Next HK$50,000 × 6% = HK$3,000
- Next HK$50,000 × 10% = HK$5,000
- Next HK$50,000 × 14% = HK$7,000
- Remaining HK$40,000 × 17% = HK$6,800
Total Salaries Tax = HK$22,800
Using the Standard Rate
This method applies a flat rate of 15% to your net income (income after deductions, but before personal allowances). It’s generally used by higher-income earners who would otherwise pay more under the progressive system.
Sample Calculation:
If your net income (after deductions) is HK$500,000, your tax payable would be:
HK$500,000 × 15% = HK$75,000
The IRD will compare this figure with the tax calculated under the progressive rates and apply the lower of the two.
Filing Salaries Tax: Completing the BIR60 Form
- Check your personal details and income – Review your name, address, and Taxpayer Identification Number. Then confirm your total income, including salary and any allowances, using the Employer’s Return (Form IR56B) as a reference.
- Enter deductions and business income – Fill in eligible deductions such as charitable donations or self-education expenses. If you’re a sole proprietor, include your business profits in the relevant section.
- Claim allowances – Indicate applicable personal allowances like basic allowance, married person’s allowance, or child allowance. These directly reduce your taxable income.
- Review your figures and calculate tax – Use the IRD’s online tax calculator or refer to a reliable tax return sample to help estimate your final liability.
- Sign and submit your form – Once everything is double-checked, sign the declaration and submit the form online or by post before the due date.
Best Time to Submit the BIR60 Form
Although the IRD provides a one-month deadline, filing early avoids last-minute stress and gives you time to correct errors. If you plan to download the BIR60 form and e-file, you may also benefit from extended deadlines.
Tax Relief and Deductions in Hong Kong
Taxpayers in Hong Kong are eligible for several deductions and allowances that can reduce their overall tax liability. Common examples include:
- Donations to approved charities
- Self-education expenses
- Contributions to recognised retirement schemes
- Home loan interest (subject to a 20-year deduction cap)
- Dependent allowances for children, spouses, and parents
The BIR60 guide provided by the IRD details the documents needed to support each deduction. Filing with these in place ensures that you benefit from every available tax-saving opportunity.
Filing Your Tax Return Online in Hong Kong
The IRD’s eTAX system lets taxpayers file their BIR60 form securely online. Using eTAX gives you instant confirmation of receipt and, in some cases, extended deadlines, especially for sole proprietors.
You’ll need to create an eTAX account to access digital filing. Once logged in, you can view a tax return sample, submit supporting documents, and track previous filings. It’s one of the most efficient ways to handle your salaries tax return, particularly for those with simple income structures.
Employer Responsibilities for Salaries Tax
Employers in Hong Kong are required to report their employees’ income to the IRD by filing forms IR56B, IR56E, or IR56F, depending on the employee’s situation (e.g. new hire, departure, termination). These must be submitted annually and/or upon specific events.
While employees file their own BIR60 form, employers must issue a copy of the IR56B return to their staff to help them complete their tax return form in Hong Kong. Failing to meet these obligations can result in penalties, making accurate and timely reporting is essential. This is why many businesses choose to work with comprehensive accounting and bookkeeping services to stay organised and on track throughout the tax season.
File Your Salaries Tax Return the Right Way
Completing your salaries tax return may seem routine, but there are important steps and deadlines that, if missed, could lead to penalties. From calculating the right tax amount to understanding allowable deductions, careful preparation makes all the difference.
That’s where NOVA comes in. We help individuals and business owners manage tax season with confidence, from the BIR60 form download to navigating deductions and avoiding common errors on your tax return form in Hong Kong. Our experts provide hands-on guidance with audit and tax compliance, so you can stay ahead of obligations and focus on what matters most.
FAQs
1. What should I do if I haven’t received the BIR60 form?
If you haven’t received your BIR60 form by early May, you can request a reissue from the IRD or access the BIR60 form download via your eTAX account. Filing is still required even if you don’t receive the form on time.
2. How do I report my own salary as a business owner?
Business owners must declare their remuneration on the BIR60 form, whether it’s director’s fees or salary drawn from the company. This income should be reported separately from business profits.
3. What is the tax year for salaries tax in Hong Kong?
The tax year in Hong Kong runs from 1 April to 31 March. The BIR60 form covers income earned within this 12-month period and is issued in early May each year.
