Get payroll up and running in Hong Kong. We'll help you set up payroll for your team in record time and take the entire compliance burden off your shoulders.
Book a demoPayroll cycle
Monthly
Payslip
Paper or digital
Tax filing
Not applicable
Tax year
1 April to 31 March
Employer taxes
at least 5%
Currency
Hong Kong Dollar (HKD)
EMBAUCHEZ N'IMPORTE OÙ
Embauchez des employés à l'étranger sans créer d'entités juridiques
Embauchez, gérez et payez des freelances dans le monde entier
PAYEZ PARTOUT
Consolidation de la paie à l'international
Standardisez vos opérations de paie dans tous vos pays
Services de paie internationale
Externalisez votre gestion de paie multi-pays
Payez votre équipe dans le monde entier
Devenez un partenaire
Rejoignez notre réseau de partenaires de paie locaux
X
Devenez un partenaire affilié de Lano et commencez à toucher des commissions
Découvrez l'écosystème d'intégrations et de partenaires de Lano
Découvrez comment Lano peut vous aider à développer et à payer votre équipe internationale.
EMPLOI MONDIAL
Recrutez les meilleurs talents n'importe où
Recrutez des employés dans des pays où vous n'avez pas d'entité légale
Se développer à l'international
Testez de nouveaux marchés sans les risques ou les coûts de l'ouverture d'entités locales.
Délocalisez et fidélisez vos employés
Conservez les talents qui partent vers d'autres pays
Transformez les freelances en employés
Incorporez des freelances à temps plein en conformité
PAIEMENTS GLOBAUX
Consolidez la paie à niveau mondial
Gérez les salaires de vos entités et de vos prestataires en un même endroit.
Créer un service de paie dans de nouveaux pays
Mise en place et gestion de la paie en toute conformité dans n'importe quel pays
Changez de prestataire de paie local
Remplacez les prestataires peu performants par des partenaires de Lano.
Effectuez des paiements internationaux
Payez votre personnel en devises locales
TÉMOIGNAGES
Découvrez comment PrestaShop s'est étendu dans quatre pays en à peine six mois grâce à Lano.
RESSOURCES
Tout ce que vous devez savoir pour embaucher des personnes dans le monde entier
Apprenez les meilleures pratiques pour gérer la paie à l'échelle mondiale
Tout ce que vous devez savoir pour embaucher des personnes dans le monde entier
Couverture de paiements de Lano
Comparez les coûts de paiement à l'échelle mondiale avec Lano
FORMATION
Apprenez à utiliser et à profiter au maximum de Lano
Restez informé de l'actualité de Lano, de son contenu et de plus de choses
Parcourez notre glossaire de termes relatifs à la paie et aux ressources humaines
Learn all you need to know about global payroll and hiring
Devenez un expert en recrutement et en gestion de la paie mondial
Gain insights into how much it costs to hire remotely in a country
Tarifs
EMBAUCHEZ N'IMPORTE OÙ
PAYEZ PARTOUT
Devenez un partenaire
EMPLOI MONDIAL
PAIEMENTS GLOBAUX
RESSOURCES
Tarifs
English
Français
Deutsch
Español
Disclaimer
This country guide is for general informational purposes only and should not be construed as legal advice, nor as binding based on your relationship with Lano. When using Lano's solutions, the specifics may depend on your EOR and Payroll setup with our partners. Although we update this guide regularly, it may not reflect current legal developments. Lano Software GmbH disclaims any liability for any actions you take or refrain from taking based on the content contained in this country guide.
As one of the fastest growing economies in APAC and one of the world’s most important financial centers, Hong Kong has attracted multinationals for many years. The autonomous territory located in southeastern China offers international organizations a highly qualified workforce with excellent English skills, which significantly simplifies hiring local employees.
Processing payroll in Hong Kong, however, is not without challenges. Although there is no obligation for employers to withhold income tax from employee salaries and wages as part of the monthly payroll process, the compliance requirements linked to payroll are numerous.
Before they can start processing payroll in Hong Kong, employers need to register with several government bodies and authorities, including:
Registration with the Inland Revenue Department (IRD) to receive an employer tax file number
Registration for Employee Compensation Insurance (ECI) as outlined in the Employees’ Compensation Ordinance
Registration for the Mandatory Provident Fund (MPF) scheme - must be completed no later than 60 days after the employee started working for the organization
Employers are further required to inform the IRD of new joiners by submitting an employment commencement notification within the first three months of the employment.
Payments to employees in Hong Kong can be made from a foreign bank account, but MPF payments require a local bank transfer. It is therefore necessary to set up an in-country bank account before the first MPF contributions are due.
Get expert guidance from the Lano team to find the best payroll setup for your business.
There is no obligation for employers to withhold income tax from their employees’ salaries and wages, which considerably lessens the payroll burden on businesses. However, employers still need to fulfill several tasks linked to the mandatory social security contributions.
Income from employment is taxed at progressive rates ranging from 2% to 17%. Taxable employment income comprises all types of remuneration provided to the employee by the employer, including salaries and wages, commissions, gratuities, bonuses, leave pay and allowances – although there are some exemptions that apply to certain employer-provided allowances.
Special rules apply to fringe benefits and housing allowances, and employees are generally not liable for income tax for MPF contributions paid on their behalf by their employer. Employee-paid contributions to the MPF scheme are also exempt from income tax, up to a maximum of HKD 18,000 per year.
The employee’s tax burden can be reduced through certain deductions. The latter include employment expenses (to some extent), charitable donations, education expenses, qualifying contributions to the Voluntary Health Insurance Scheme (VHIS) and mortgage interest payments. There are also several personal allowances available, including allowances for children and other dependent family members.
There are no fixed criteria to determine residency. Instead, the Inland Revenue Ordinance states that individuals are to be considered residents of Hong Kong if they ordinarily reside in Hong Kong with only temporary absences. Regardless of whether the employee is considered as a resident or not, they are obligated to pay income tax on employment income sourced in Hong Kong, which generally also applies to employees under a foreign employment contract rendering services in Hong Kong.
However, there is a 60-day rule which applies to foreigners temporarily staying in Hong Kong for work purposes. The latter are exempt from paying local income tax on their employment income if they only spend 60 days or less in Hong Kong within a tax year. If, on the other hand, their stay in Hong Kong exceeds 60 days, they could become liable for paying local income tax.
2022 Tax Bands
Corresponding Tax Rates
Employers are not responsible for withholding income tax from employee wages and salaries during their monthly payroll process. Instead, individual income tax is assessed once a year. The amount due is paid in two installments and the payments are made directly by the employee.
For assessment purposes, both employee and employer are required to file an annual tax return detailing all the remuneration paid to the employee over the course of the respective tax year. The necessary forms are sent out by the Inland Revenue Department (IRD) in the beginning of May of each year. From the date of issuance, employers and employees have one month to complete the tax return and send it back to the IRD for the final assessment. There is an automatic one-month extension for electronic filing. The tax year runs from 1 April to 31 March.
Every employer with a permanent establishment in Hong Kong is required to make a contribution equal to at least 5% of the employee’s monthly earnings to a retirement scheme - additional voluntary contributions are possible. The scheme must be classified as a Mandatory Provident Fund (MPF) scheme as outlined by the Mandatory Provident Fund Schemes Ordinance. It is up to the employer to select an MPF trustee and employees changing jobs are required to change to the MPF provider chosen by their new employer.
A monthly salary cap of HKD 30,000 applies, i.e. neither employee nor employer pay contributions on the part of the salary exceeding HKD 30,000. Employees earning less than HKD 7,100 per month are exempt from making contributions – the employer contribution stays mandatory.
Employees are also required to contribute at a rate of 5%. However, new joiners are exempt from paying contributions during the first 30 days of employment as well as during the first incomplete payroll cycle that follows the 30-day period. Employers, on the other hand, become liable for MPF contributions starting from the first day of employment – unless the employment lasts for less than 60 days.
The calculation, deduction and payment of MPF contributions is the responsibility of the employer. Contributions must be paid on a monthly basis in respect of each pay period. The due date for the MPF payment is the 10th of the following month. Payments are made directly to the respective MPF scheme administration and must be accompanied by a monthly remittance declaration.
The Employees’ Compensation Ordinance further makes it mandatory for employers to take out insurance coverage against work injuries and occupational diseases. The legally required amount of insurance cover per event varies depending on the number of employees. Premiums are set according to the employee’s occupational risk and are paid solely by the employer.
Contribution Type
Employer Rate
Employee Rate
Employees in Hong Kong are entitled to various benefits. These include:
Annual leave and public holidays: between 7 and 14 days of annual leave, depending on length of service; 13 statutory public holidays
Maternity leave: 14 weeks of maternity leave, which can begin up to 4 weeks before the expected due date; paid at four fifths of the employee’s daily average wages (capped at HKD 80,000)
Paternity leave: 5 days of paternity leave, which can be taken either consecutively or separately; the right to go on paternity leave begins 4 weeks before the expected due date and ends 14 weeks after the delivery; paid at four fifths of the employee’s daily average wages
Sick leave: 2 paid sick days per month during the first year of service; thereafter, four paid sick days per month of service (up to a maximum of 120 sick days); sickness benefits amount to four fifths of the employee’s daily average wages
For more information on employee benefits and other employment requirements in Hong Kong (including severance pay and termination procedures), check out our Global Hiring Guide.
Expert Talks
Hong Kong’s minimum wage currently (November 2022) stands at HKD 37.50 per hour. In October, the Minimum Wage Commission announced a raise of the hourly minimum pay rate to HKD 40.00. The changes are expected to enter into effect in May 2023 – supposed they are approved by the Executive Council.
The Employment Ordinance mandates employers to provide employees with an end-of-year payment. Unless stipulated otherwise in the individual employment contract, the payment must be equal to the employee’s average monthly wages. The date of the payment is to be specified in the individual employment contract – otherwise, the payment is to be issued on the last day of the pay period or within the 7 days following the last pay period of the year.
Unless defined otherwise by the employee and the employer, the pay period is one month. The Employment Ordinance further mandates that employees must be paid either on the last day of the pay period or not later than 7 days after the end of the respective pay period.
Employees should be provided with a payslip for each pay period. Payslips can either be provided in hard form or electronically. Furthermore, employers are required to collect and maintain payroll records. The minimum retention period for payroll records is 7 years.
Ce guide de pays est destiné à des fins d'information uniquement et ne doit pas être interprété comme un conseil juridique. Le contenu de ce guide contient des informations générales et malgré le fait que nous le mettions à jour régulièrement, il peut ne pas correspondre aux développements juridiques actuels. Lano Software GmbH décline toute responsabilité concernant les actions que vous entreprenez ou vous abstenez d'entreprendre sur la base du contenu de ce guide de pays.
Des contrats conformes jusqu’à l’onboarding, tout ce qu’il vous faut pour constituer la meilleure équipe du monde.
Obtenez des conseils pour développer des entreprises à l'échelle mondiale. Rejoignez dès maintenant plus de 50 000 inscrits!
© Lano Software GmbH 2024
English
Français
Deutsch
Español