Allowances

You are entitled to the basic allowance and may be eligible to claim other allowances provided that the prescribed conditions are satisfied.  Here you can learn about these allowances and how they might reduce your tax burden.

Basic Allowance

You are entitled to the basic allowance unless you are married and have been granted the married person’s allowance for the year. You do not have to lodge a claim for this allowance.

Married Person’s Allowance

You can claim the married person’s allowance if you were, 

• married but not living apart; or
• living apart from your spouse but maintaining or supporting him or her; and
• your spouse did not have any income chargeable to salaries tax; or
• you and your spouse have elected for joint assessment; or
• you and your spouse have elected for personal assessment.

“Marriage” in the context of the Inland Revenue Ordinance (IRO), refers to a heterosexual marriage between a man and a woman. “Spouse” is defined in section 2 of the IRO as a husband or a wife. A “husband” is a married man and a “wife” is a married woman.

Child Allowance

You can claim the child allowance if, during a year of assessment, you maintain an unmarried child, who was:

• under 18 years old; or
• of or over 18 but under 25 years old, and receiving full time education at a university, college, school or other similar educational establishment; or
• of or over 18 years old and was, because of physical or mental disability, unable to work.

A “child” means:

• your own child, adopted child or step child; or
• the child / adopted child / step child of your spouse or former spouse.

You must decide who will claim all the child allowances. All Child Allowances should be claimed enbloc by either the husband or the wife unless they are living apart. In general, the overall tax liabilities of a married couple may be minimised if a nomination is made in accordance with the following guidelines:

If, other than you, some one else is entitled to claim the allowance for the same child for the same year of assessment, you must agree amongst yourselves on who shall claim it. If there is no agreement, no allowance will be granted.

For the year of assessment 2007/08 onwards, the child allowance will be increased by $50,000 in the year the child was born.

Dependent Brother or Dependent Sister Allowance

You can claim dependent brother or dependent sister allowance if you or your spouse maintains an unmarried brother or sister, who at any time during the year of assessment was:

• under 18 years old; or
• of or over 18 but under 25 years old, and receiving full time education at a university, college, school or other similar educational establishment; or
• of or over 18 years old and was, because of physical or mental disability, unable to work.

A “brother or sister” means:

• your natural, adopted or step brother or sister; or
• the natural, adopted or step brother or sister of your spouse / deceased spouse.

A brother or sister is only treated as maintained by you or your spouse if during the year, you or your spouse had sole or predominant care of the brother or sister. If, other than you, some one else is entitled to claim the allowance for the same brother or sister for the same year of assessment, you must agree among yourselves on who shall claim it. If there is no agreement, no allowance will be granted.

Dependent Parent or Dependent Grandparent Allowance

You can claim the dependent parent or dependent grandparent allowance if you or your spouse maintains a parent or grandparent, who:

• was ordinarily resident in Hong Kong; and
• was 60 years old or above, or eligible to claim an allowance under the Government’s Disability Allowance Scheme; and
• either resided with you and your spouse, otherwise than for full valuable consideration, for a continuous period of no less than 6 months, or had received from you or your spouse not less than $12,000 in money towards his or her maintenance.

You can claim an additional dependent parent or additional dependent grandparent allowance for each dependent parent or grandparent who resided with you, otherwise than for full valuable consideration, continuously throughout the year of assessment.

From the year of assessment 2005/06 onwards, a new dependent parent or dependent grandparent allowance is granted for maintaining a dependent parent or grandparent who is:

• between 55 and 60 years old at any time during the year of assessment; and
• not eligible to claim an allowance under the Government's Disability Allowance Scheme throughout the year of assessment; and
• ordinarily resident in Hong Kong; and
• either resided with you, otherwise than for full valuable consideration, for a continuous period of 6 months or received from you or your spouse not less than $12,000 in money towards his or her maintenance.

A new additional dependent parent or additional dependent grandparent allowance will also be granted if the dependant resided with you, otherwise than for full valuable consideration, continuously throughout the respective year of assessment. The rate of the new basic and additional allowance is one half of the respective counterpart allowance granted to you for maintaining a dependent parent or grandparent who is 60 years old or more or who is eligible to claim an allowance under the Government’s Disability Allowance Scheme.

A “parent” means:

• your natural father or mother / your step parent; or
• the natural father or mother / step parent of your spouse; or
• a parent by whom you or your spouse was legally adopted; or
• a parent of your deceased spouse.

A “grandparent” means:

• your natural grandfather or grandmother / your adoptive grandparent / your step grandparent; or
• the natural grandfather or grandmother / adoptive grandparent / step grandparent of your spouse; or
• a grandparent of your deceased spouse.

Only one individual can be granted an allowance for the same dependant. If more than one individual is entitled to the allowance for the same dependant, they must agree amongst themselves on who shall claim the allowance.

If you have been granted a deduction for elderly residential care expenses for a parent or grandparent, you will not be granted a dependent parent or dependent grandparent allowance for the same parent or grandparent for that year of assessment.

Single Parent Allowance

You can claim single parent allowance if you have taken ongoing responsibility for the care and supervision to your child, and have satisfied the following conditions:

• Throughout the year of claim you must not be married. Hence, no allowance can be claimed for the year of marriage, divorce, death of your spouse or separation from your spouse. The earliest opportunity to make a claim will be the year following these events. 
• You are granted a child allowance for the year of claim.

Whilst child allowance is granted on account of monetary contributions to maintenance and education, single parent allowance is granted on account of time spent on care and supervision. 

If both parents want to claim the single parent allowance, the allowance may be apportioned by reference to the periods of time in which the claimants had the sole or predominant care of the child concerned during the year of assessment. The law provides that, in case of dispute, the Commissioner may decide the basis for such apportionment.

The law also specifies that no parent can claim the single parent allowance merely on the ground that he or she had made contributions to the maintenance and education of the child. Furthermore, no allowance can be granted for any second or subsequent child.

Disabled Dependant Allowance

You can claim disabled dependant allowance if you or your spouse maintains a dependant who is eligible to claim an allowance under the Government’s Disability Allowance Scheme.

Here, “dependant” means:

• your spouse / child / parent / grandparent / brother or sister
• your spouse's child / parent / grandparent / brother or sister

This allowance is granted in addition to the following allowances or deduction for the disabled person:

• married person’s allowance; or
• child allowance; or
• dependent parent or grandparent allowance or elderly residential care expenses; or
• dependent brother or sister allowance.

Further Information

You can access common questions and answers on allowances through the following link.