Financial Secretary Paul Chan presented the 2026-27 Budget this morning (Feb. 25).
Starting from the assessment year 2026/27, the government plans to increase the basic allowance and single parent allowance from HK$132,000 to HK$145,000, along with raising the married person's allowance from HK$264,000 to HK$290,000. This initiative is expected to benefit approximately 2.09 million taxpayers and will result in an annual reduction in tax revenue of around HK$3.56 billion.
Additionally, the child allowance and additional child allowance will increase from HK$130,000 to HK$140,000, benefiting about 360,000 taxpayers and reducing tax revenue by approximately HK$680 million each year.
The government also intends to enhance the allowance for maintaining a dependent parent or grandparent and to raise the deduction cap for elderly residential care expenses. These changes are projected to assist around 830,000 taxpayers, decreasing tax revenue by about HK$970 million annually.
The specific adjustments include:
- Increasing the allowance for maintaining a dependent parent or grandparent aged 60 and above from HK$50,000 to HK$55,000. The same increase applies to an additional allowance for those living with these parents or grandparents.
- Raising the allowance for maintaining a dependent parent or grandparent aged 55 to 59 from HK$25,000 to HK$27,500, with a similar increase for taxpayers residing with them.
- Increasing the deduction ceiling for elderly residential care expenses from HK$100,000 to HK$110,000 for taxpayers whose parents or grandparents are in approved residential care facilities.
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