1. What is Ad Valorem Stamp Duty (AVD)
AVD is levied on the buyer by the Inland Revenue Department when purchasing residential property in Hong Kong. It must be paid within 30 days of signing the Provisional Sales & Purchase Agreement (PASP), typically handled by the buyer's solicitor.
The current regime has one scale — the additional Buyer's Stamp Duty (BSD) on non-permanent residents and Special Stamp Duty (SSD) on quick resales were fully abolished in February 2024. First-time HK permanent-resident buyers pay a lower scale; all other cases pay the standard scale.
2. 2026 AVD rate table
The scale below applies to first-time buyers (HK permanent residents holding no other HK residential property). Non-first-time and corporate buyers use the same scale but cannot claim first-time relief.
| Property price (HK$) | AVD payable |
|---|---|
| 4,000,000 or below | HK$100 |
| 4,000,001 – 4,323,780 | HK$100 + 20% of excess above HK$4,000,000 |
| 4,323,781 – 4,500,000 | 1.5% |
| 4,500,001 – 4,935,480 | HK$67,500 + 10% of excess above HK$4,500,000 |
| 4,935,481 – 6,000,000 | 2.25% |
| 6,000,001 – 6,642,860 | HK$135,000 + 10% of excess above HK$6,000,000 |
| 6,642,861 – 9,000,000 | 3.00% |
| 9,000,001 – 10,080,000 | HK$270,000 + 10% of excess above HK$9,000,000 |
| 10,080,001 – 20,000,000 | 3.75% |
| 20,000,001 – 21,739,120 | HK$750,000 + 10% of excess above HK$20,000,000 |
| 21,739,121 or above | 4.25% |
3. First-time buyer definition
The IRD applies strict conditions: buyer must be a HK permanent resident, hold no other HK residential property on the PASP signing date (including jointly held, inherited, or corporate-held), and purchase as a natural person (not through a company).
For joint purchases, if either spouse owns another property the entire transaction loses first-time status. In practice, many couples arrange for the non-owning spouse to be the sole purchaser to preserve relief — but this affects mortgage approval and family asset planning; consult your solicitor and mortgage broker first.
4. Three worked examples
Common price points, first-time buyer assumed.
| Purchase price | Rate band | AVD payable |
|---|---|---|
| HK$6,000,000 | 2.25% | HK$135,000 |
| HK$10,000,000 | 10% marginal | HK$370,000 |
| HK$18,000,000 | 3.75% | HK$675,000 |
5. How negotiation compounds tax savings
AVD is calculated on the final agreed price, so every HK$100,000 negotiated off saves both the price and the tax on it. In the HK$10M band (3.75%), a HK$100,000 discount = HK$3,750 stamp-duty saving. A HK$500K discount in the HK$18M band = HK$18,750 saved.
The real value of negotiation is compound: price + stamp duty + legal fees + mortgage interest over 30 years — which is why every buyer should have independent price representation.
6. FAQ
Can I correct the rate band after signing the PASP?+
Yes. If you discover you qualified for first-time relief (or vice versa) after signing, your solicitor can apply to the IRD for a refund or reassessment. Confirm your property-holding status before signing.
Do gifts from parents attract stamp duty?+
Yes. Deeds of Gift between close relatives still attract AVD, but the recipient may claim the first-time scale if eligible.
Does buying through a company change the rate?+
Since SSD and BSD were abolished, corporate purchases pay the same standard scale — but cannot claim first-time relief.