Property Tax - What you need to know as a Property Owner
- What are my tax obligations as a property owner
- Which tax return is for reporting rental income and how to complete
- How Property Tax is computed
- What is rental income
- What deductions can I claim
- Can I pay less tax by electing Personal Assessment
- Is there any relief if the property is for owner's business use
- What should I do if I disagree with the tax assessment
- What is the tax implication on individual owners of a building if the common areas are let out
- Pamphlets and related Public Forms
- Personal Assessment
You can Click HERE for a brief guide to Personal Assessment, where you can find examples of how Personal Assessment may reduce your tax liabilities.
You can also use our tax computation program to check whether it is to your advantage to elect Personal Assessment.
If the income from property chargeable to Property Tax is included in your profits for Profits Tax purposes, or if the property you owned is occupied by you for business purposes, the amount of Property Tax paid may be deducted from the amount of Profits Tax assessed.
Corporations carrying on a trade, profession or business in Hong Kong may make application in writing for exemption from paying the Property Tax, which would otherwise be set off against their Profits Tax.
Normally, the common areas of a building such as side shop, carpark, external wall, roof top etc are collectively owned by the individual owners of the building. If any part of the common areas is let out, the rental income derived is chargeable to Property Tax. The owners are responsible for reporting the rental income and paying the tax. If the owners have not received a tax return relating to the common areas let, they are required to notify us in writing.
However, when an owners' corporation is formed, section 16 of the Building Management Ordinance provides that the rights and duties of the owners relating to the common parts of the building shall be exercised and performed by the incorporated owners of the building. Therefore, the owners' corporation is required, on behalf of all the owners of the building, to report the income and pay the tax.
With effect from 12 February 2010, when an owners' incorporation or a person receives any rental income on common parts of a building, either on own behalf or on behalf of another person, the owners' incorporation or the person receiving the rent will be regarded as owner of the common parts and is thus required to report the rental income and pay the property tax.