The tenancy agreement stamp duty, also called rental stamp duty, is a tax imposed by the government on rental agreements to ensure that they are legally binding, validating your tenancy and securing the rights of both tenant and landlord in the event of a dispute. In this article, we will go over the stamp duty, including the rates and how the stamp duty is calculated. In addition, we will address some common questions around tenancy agreements and stamp duty.
When is the Stamp Duty Paid and Who Pays It?
In Hong Kong, the tenant, landlord, and any other signatories to the tenancy agreement are jointly liable for the payment of stamp duty, to be paid within 30 days of the date the tenancy agreement is signed. However, Hong Kong law does not specify how the cost should be divided among the parties, leaving it up to them to negotiate as part of the agreement. Typically, the tenant and landlord will agree to split the stamp duty equally.
Consequences of Late Payment
Severe penalties may be imposed if the stamp duty is not paid on time, resulting in fees of up to ten times the original amount. On top of this, the tenancy agreement cannot be enforced or used as evidence in court while the stamp duty remains unpaid. This means that if disputes arise in the interim, the agreement will not be recognized by the legal system, leaving both parties without recourse to enforce their rights under the agreement.
How is Stamp Duty Calculated?
To calculate the stamp duty for a tenancy agreement in Hong Kong, you need to know your monthly rent and the lease duration. Tenancy Agreement Stamp duty rates in 2025 are as follows:
| Tenancy / Lease Duration | Stamp Duty Rate* |
| Undefined or uncertain | 0.25% of yearly/average yearly rent |
| Up to 1 year | 0.25% of total rent payable |
| More than 1 year up to 3 years | 0.5% of yearly/average yearly rent |
| More than 3 years | 1% of yearly/average yearly rent |
*Yearly rent, average yearly rent and total rent amounts are to be rounded up to the nearest $100. Rental deposits are excluded from stamp duty calculation. Stamp duties calculated to the decimal are to be rounded up to the nearest dollar.
There is also an additional fee of HK$5 for each duplicate or counterpart of the tenancy agreement.
The formula used to calculate the stamp duty is as follows if the rent amount is expressed per year:
Stamp Duty Rate x Yearly rent
If the rent amount is expressed per month:
Stamp Duty Rate x (Monthly rent x 12)
If there are rent-free periods, these periods will reduce the base rent, for example, if there is a 1-month rent free period in the year:
Stamp Duty Rate x (Monthly rent x 11)
How do you pay stamp duty?
The tenancy agreement stamp duty can be paid online through the Hong Kong Government’s eTax Portal, or offline via the post office, convenience stores, or the Stamp Office after filling in a stamping request form.
What is the difference between rental stamp duty and tenancy agreement stamp duty?
Both terms apply to the same stamp duty applied to tenancy agreements for rental properties.
What is the difference between a tenancy agreement and a licence agreement?
A tenancy agreement grants the tenant exclusive possession of the property for a specified period, giving tenants the right to prevent others from entering the property without permission. This differs from licence agreements that merely grants permission to tenants to use the property, where they cannot prevent others from entering without permission. These agreements are often used for short-term or non-exclusive occupations such as hotel rooms or car park spaces, and are not subject to stamp duty.
Conclusion
Tenancy agreements are important to helping maintain friendly relations between landlords and tenants by establishing terms and conditions both sides agree to. The stamp duty paid legally binds this agreement to be enforceable in court if disputes do arise, making timely payments vitally important.
