Tax
2026 Policy Address: Child Allowance to HK$160,000
Gary Chung（FinKit Editor-in-Chief） · Published：September 22, 2026
On 16 September 2026 the Policy Address proposed raising the child allowance for a second and subsequent child born on or after 16 September 2026 from HK$140,000 to HK$160,000, with the additional child allowance for newborns rising to HK$160,000 too, from the 2026/27 year of assessment — but legislation is still pending. This guide uses the IRD's own worked examples to show who qualifies, how much it is worth, and how it differs from the two-year extension already enacted in the 2026-27 Budget.
What Was Announced
The 2026 Policy Address (16 September 2026) set out two tax measures aimed at raising the birth rate:
| Measure | Current (2026/27, enacted) | Policy Address proposal |
|---|---|---|
| Child allowance (2nd and subsequent child) | HK$140,000 | HK$160,000 |
| Additional child allowance for newborns (first two years after childbirth) | HK$140,000/yr | HK$160,000/yr |
| Stamp duty concession for newborn families (waiver cap) | None | HK$20,000 |
⚠️ Three conditions — all must be met
- The child must be your second or subsequent child
- The child must be born on or after 16 September 2026
- It applies from the 2026/27 year of assessment — but the measure is still awaiting legislation
Three Things People Mix Up
① Child allowance (each of the 1st–9th child)
Enacted for 2026/27: HK$140,000 per child, claimable every year regardless of when the child was born.
② Additional child allowance for newborns (enacted)
In the year a child is born, you can claim one extra HK$140,000 on top of the basic child allowance. From 2026/27 the claim period was extended from one year to two years (HK$280,000 in total), for children under the age of two by the end of the year of assessment — i.e. born on or after 1 April 2025. This came from the 2026-27 Budget and was gazetted on 22 May 2026.
③ Policy Address increase (pending legislation)
For a second and subsequent child born on or after 16 September 2026, both ① and ② rise from HK$140,000 to HK$160,000. This does not take effect until the legislative process is completed.
In short: ② is a relaxation of timing (one year to two, already in force); ③ is an increase in amount (140,000 to 160,000, pending). You can benefit from both, but they are separate changes.
How the IRD Defines “Second and Subsequent Child”
The definition is practical: if you are granted child allowance for two or more children in the same year of assessment, the second and subsequent of those children count as your “second and subsequent children”. It depends on how many children you are actually granted allowance for, not simply on birth order.
So two things must be true: at least two children in the same year of assessment, and that child born on or after 16 September 2026.
Three Official Examples
The IRD's own FAQ examples, all for the 2026/27 year of assessment:
| Situation | Increase applies? | Allowance for the year |
|---|---|---|
| One child only, born 20 September 2026 | No — not a “second” child | $140,000 + $140,000 = $280,000 |
| Two children, born 1 June 2025 and 1 September 2026 | No — second child born before 16 Sep | $280,000 each = $560,000 |
| Two children, second born 20 September 2026 | Yes — second child qualifies | First $280,000 Second $320,000 = $600,000 |
Note: $320,000 = child allowance $160,000 + additional child allowance for newborns $160,000.
What It Is Worth (at a 17% Marginal Rate)
Using the third example above (second child born 20 September 2026):
| Period | Allowance for that child | Extra vs today | Extra tax saved |
|---|---|---|---|
| Year 1 after birth | $320,000 | +$40,000 | ≈ $6,800 |
| Year 2 after birth | $320,000 | +$40,000 | ≈ $6,800 |
| Year 3 onwards (while still eligible) | $160,000 | +$20,000 | ≈ $3,400 |
Over the first two years the extra saving is about $13,600. Figures assume a 17% marginal rate; at 10% the saving is roughly 60% of these amounts. Allowances only reduce chargeable income — if you pay no tax to begin with, an increase produces no cash benefit.
The Other Measure: Newborn Family Stamp Duty Concession
The Policy Address also proposes a stamp duty waiver capped at HK$20,000 for eligible families buying a residential property. All of these must be met:
- The property must be residential
- Acquired by the parent(s) of a child born in Hong Kong on or after 16 September 2026 (births outside Hong Kong do not qualify)
- Either parent is a Hong Kong permanent resident
- The parent acquires it on his or her own behalf (not through a company)
- Acquired within one year before or two years after the child's date of birth
How the waiver is calculated
The waiver equals the lower of the ad valorem stamp duty payable and HK$20,000. If the AVD payable is $19,000, nothing is due; if it is $21,000, you pay $1,000.
The concession is granted per eligible child: two eligible children can cover two separate properties, or each parent can use one, and for a jointly owned property the two parents together can claim up to HK$40,000.
⚠️ Before the law is enacted
Until the amendment ordinance is enacted, stamp duty is still charged at the prevailing rates. Eligible families can then apply for a refund of the excess AVD paid; the IRD will issue refund guidance after the amendment bill passes.
Timeline: When Does It Reach Your Pocket?
| Date | What happens |
|---|---|
| 22 May 2026 | 2026-27 Budget tax measures gazetted: allowances raised, newborn additional allowance extended to two years, elderly residential care cap raised to HK$110,000 (in force) |
| 16 Sep 2026 | Policy Address proposes HK$160,000 for a second and subsequent child, plus the newborn stamp duty concession (pending legislation) |
| May–Jun 2027 | 2026/27 tax returns (BIR60) are issued. If the legislation has passed, the IRD applies the higher amounts automatically — no separate form |
FAQ
Q: Is the increase in force now?
A: No. Both measures require an amendment ordinance to pass LegCo. They are announced but not yet in force; the practical claim point is the 2026/27 assessment, from mid-2027.
Q: Does my first child get the increase?
A: No. The increase applies only to a second and subsequent child. The first child keeps the HK$140,000 child allowance plus the HK$140,000 newborn additional allowance in the first two years.
Q: Do I need to apply separately?
A: No. Complete the tax return as usual and claim the child allowance; the IRD will use the increased amount automatically where you qualify.
Q: My child is older — does it still apply?
A: The increase follows the date of birth (on or after 16 September 2026), not when you first claimed. If the child is no longer eligible for the child allowance (for example, over the age limit or financially independent), there is nothing to increase.
Q: Will the IRD apply it automatically?
A: Once legislation is complete, the IRD will apply it when assessing your tax. You still need to claim the child allowance for each child in your return, otherwise there is nothing for the increase to attach to.
Estimate your tax with the enacted 2026/27 allowances:
Salaries Tax Calculator →Disclaimer: This article is for reference only and does not constitute tax advice. The Policy Address measures must complete the legislative process before taking effect and details may change. Enacted items follow the 2026-27 Budget. Actual figures are subject to the IRD's latest announcements.