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.
AVD, BSD, SSD — what each term means
Hong Kong's stamp-duty acronyms confuse most buyers. Here is the mapping used by the Inland Revenue Department, so you can reconcile solicitor and bank paperwork.
Key point: Buyer's Stamp Duty (BSD) and Special Stamp Duty (SSD) were abolished with effect from 28 February 2024. Non-permanent residents and short-term resales are no longer subject to them. Residential transactions now attract Ad Valorem Stamp Duty only.
| English | Chinese | Status |
|---|---|---|
| Ad Valorem Stamp Duty (AVD) | 從價印花稅 | In force, banded on the price |
| Buyer's Stamp Duty (BSD) | 買家印花稅 | Abolished February 2024 |
| Special Stamp Duty (SSD) | 額外印花稅 | Abolished February 2024 |
| Scale 1 / Scale 2 | 第一 / 第二標準稅率 | Residential now on the lower scale |
| Chargeable consideration | 應課稅代價（成交價） | The negotiated price is the tax base |
Worked examples from HK$4M to HK$20M
Stamp duty at common price points, and what each HK$100,000 you negotiate off saves in tax. Watch the marginal bands such as HK$4,000,001 – HK$4,323,780, where the duty jumps sharply — negotiating back under a band threshold can save tens of thousands at once.
| Price | Rate / formula | Stamp duty | Saved per HK$100K negotiated |
|---|---|---|---|
| HK$4,000,000 | Flat | HK$100 | — (already lowest band) |
| HK$4,200,000 | HK$100 + 20% of excess | HK$40,100 | Up to HK$20,000 |
| HK$5,000,000 | HK$67,500 + 10% over 4.5M | HK$117,500 | HK$10,000 |
| HK$6,000,000 | 2.25% | HK$135,000 | HK$2,250 |
| HK$8,000,000 | 3.00% | HK$240,000 | HK$3,000 |
| HK$12,000,000 | 3.75% | HK$450,000 | HK$3,750 |
| HK$20,000,000 | 3.75% | HK$750,000 | HK$3,750 |
Refunds, trading up, and the 30-day deadline
Deadline: stamp duty on residential property is payable within 30 days of signing the provisional agreement, normally handled by your solicitor. Late payment penalties can reach ten times the duty. This is cash — it cannot be added to the mortgage.
Trading up: if you still own your existing home when you buy the next one, that purchase may not qualify for the lower first-time scale. In certain cases, selling your original sole residential property within the prescribed period allows you to apply to the Inland Revenue Department for a refund of the difference. Confirm the current rules with your solicitor.
Stamp duty is assessed on the price stated in the agreement. Whatever you negotiate the price down to is the figure the Revenue taxes — which makes negotiation the most direct lever on your total cost.
9. 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.
How is stamp duty calculated in Hong Kong?+
Residential ad valorem stamp duty is banded on the transaction price: a flat HK$100 at or below HK$4,000,000, then 1.5% to 4.25% up to HK$21,739,120, with buffer formulas (a fixed amount plus 10% or 20% of the excess) between bands so the duty does not jump in one step.
What does ad valorem stamp duty mean in Chinese?+
Ad valorem is Latin for 'according to value'; in Chinese it is 從價印花稅 — stamp duty charged as a percentage of the property's transaction price and paid by the buyer to the Inland Revenue Department.
Do I still pay BSD or SSD?+
No. Buyer's Stamp Duty and Special Stamp Duty were abolished with effect from 28 February 2024. Residential purchases now attract ad valorem stamp duty only.
Can stamp duty be included in the mortgage?+
No. It must be paid in cash within 30 days of the provisional agreement and cannot be added to the loan, so budget for it separately.