Tax
Hong Kong Rates Guide 2026:
How They're Calculated, When to Pay, and How to Save
Gary Chung（FinKit Editor-in-Chief） · Published：June 6, 2026
You get a rates demand note every quarter — but do you know how the numbers are worked out? What's the difference between rates and government rent? How do government concessions get applied? Everything answered in one place.
What Are Rates?
Rates are an indirect tax levied by the Hong Kong government on all properties (residential and non-residential), with a history dating back to 1845. Originally used to fund the police force, the name "rates" stems from this historical origin.
Today, rates are calculated as the property's rateable value × 5%, payable in four quarterly instalments. All property owners must pay rates, whether the property is owner-occupied or rented out.
How Is the Rateable Value Determined?
Assessed annually by the Rating and Valuation Department (RVD), the rateable value is an estimate of the annual rental income the property could command if let on a specified valuation date.
How to check your property's rateable value:
- Visit rvd.gov.hk → "Property Information Online"
- Search by entering the property address
- Or check your most recent rates demand note — it states the "Rateable Value"
Rates Calculation Formula
Worked Example
Suppose your flat's rateable value is HK$400,000:
* If government rent (3%) applies, add another HK$3,000 per quarter — total HK$7,000/quarter
Rates vs Government Rent: What's the Difference?
| Rates | Government Rent | |
|---|---|---|
| Rate | 5% | 3% |
| Coverage | All properties in HK | New Territories + parts of Kowloon |
| Applies on HK Island? | ✅ Yes | ❌ Mostly no |
| Purpose | General government revenue | Compensation for lease renewal |
| Tax deductible? | ✅ Deductible against property tax | ✅ Deductible against property tax |
Quarterly Payment Schedule
Rates Concession Scheme
The government frequently announces rates concessions in the annual Budget, applied directly to your demand note — no separate application is needed.
| Year | Quarterly Concession Cap |
|---|---|
| 2025/26 | HK$1,000 |
| 2024/25 | HK$1,000 |
| 2023/24 | HK$1,000 |
| 2022/23 | HK$1,500 (Q1–Q3) / $1,000 (Q4) |
Payment Methods
Late Payment Penalties
Within 1 month after the due date
5% surcharge added
Over 6 months overdue
Additional 10% surcharge (15% total)
Persistent default
Government may take legal action, including registering a charge on the property
Frequently Asked Questions
Does the tenant pay rates?
Legally, rates are the owner's responsibility. However, the tenancy agreement can stipulate that the tenant pays rates and government rent — this is a commercial arrangement. The government will only pursue the owner for payment.
Do I pay rates on a vacant property?
Yes. Rates are charged on the property itself, not on its occupancy. Even if the unit is vacant and unoccupied, rates are still payable.
How do I object to my rateable value?
After receiving the new valuation notice each year (around March–April), you can submit a “Proposal to Alter the Rateable Value” (Form R20A) to the RVD within the specified period — free of charge.
Are rates tax deductible?
Rates on rented properties can be deducted when filing property tax. Rates on owner-occupied properties cannot be deducted against salaries tax. However, if you elect Personal Assessment, both rates and government rent on rented properties are deductible.
What if my rates demand note gets lost in the post?
You can view an electronic copy at rvd.gov.hk or call the RVD hotline (2150 8888). Even if the note is lost, the due date still applies — setting up autopay is recommended to avoid missed payments.
Want to calculate your rates?
Rates Calculator →