Treatment of Married Couple under Personal Assessment

A married couple may elect for personal assessment to reduce their tax liability. Here you can find out what happens if personal assessment is elected, how personal assessment affects the carrying forward of business losses and how tax is allocated to each of the couple if they elected for personal assessment jointly.

Electing for Personal Assessment as a Couple

For the year of assessment up to 2017/18, if you are married and not living apart from your spouse, and both of you have income assessable to tax, election for personal assessment must be made by you and your spouse jointly. Separate taxation for a couple is not applicable under personal assessment for a year of assessment up to 2017/18.

From the year of assessment 2018/19 onwards, a married person may elect for personal assessment separately from or jointly with his/her spouse. If you elect for personal assessment jointly with your spouse, both of you and your spouse must have income assessable to tax. If you and your spouse are jointly assessed under Salaries Tax, election for personal assessment must be made by you and your spouse jointly.

When a married couple elect for personal assessment jointly, the total income of the individual taxpayer, as appropriately reduced, is aggregated with that of his or her spouse to arrive at the joint total income of the couple for assessment.  

Treatment of Business Losses under Personal Assessment

“Losses” in the following context means the sum of business losses incurred in the year of assessment and losses brought forward from previous years under personal assessment.

If you and your spouse have elected for personal assessment jointly and the aggregate amount of your losses and deductions exceeds your total income, such excess must first be set off against the total income of your spouse before being carried forward. The maximum amount that can be carried forward to be set off against your total income for future years of assessment is the unabsorbed losses.

Allocation of Tax Payable

If the couple elects for personal assessment jointly, normally the total tax payable is proportionally allocated to each of the couple on the basis of their respective reduced total income. A notice of assessment is issued to each of them.


For the year of assessment 2022/23, the assessable profits of Mr Chan’s sole proprietorship business were $460,000. Mrs Chan received monthly rent of $10,000 from a property under mortgage. She paid mortgage interest of $56,000 during the year.

Personal Assessment Elected       




Business profits (Mr Chan)



Property income (Mrs Chan)



-Net assessable value ($10,000 x 12 x 80%)



-Less: Mortgage interest



Total income



Less: Married person’s allowance



Net chargeable income



Tax thereon (at progressive rates)



Less: 100% tax reduction (capped at $6,000) (Note)



Tax payable






Mr Chan’s share of tax payable

($16,120 x 460,000 / 500,000)




Mrs Chan’s share of tax payable

($16,120 x 40,000 / 500,000)





Mr and Mrs Chan will each receive a notice of assessment and demand for payment.

(Note) For 2022/23, 100% of the final tax payable under profits tax, salaries tax and tax under personal assessment would be waived, subject to a ceiling of $6,000 per case.

Further Information

More illustrative examples on tax computation for married couple after relaxing the requirement for election of Personal Assessment.

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Last revision date: April 2023