Hong Kong Property Transactions, Stamp Duty on Residental Property

A Guide to Understanding Buyers Stamp Duty (BSD)

 Our professional guide to understanding buyers stamp duty (BSD) in Hong Kong.

 Hong Kong Property Transactions, Stamp Duty on Residental Property
The Buyers Stamp Duty was imposed by the Hong Kong Government on 27th October 2012 in order to cool the overheated property market.
However it has been the source of confusion for many buyers as to who is liable to pay, the different scenarios surrounding exceptions, and how to avoid paying.    We aim to lift the lid and answer many of the common questions for buyers and sellers.

Is the buyer or the vendor liable to pay the BSD?

The buyer  is liable to pay the BSD

How much is the BSD?

BST is charged at 15% on the stated consideration or of the market value of the property (whatever is higher)

Who is exempt from paying BSD?

Only an individual holding a permanent Hong Kong Identity Card ie: was born in Hong Kong or has resided in Hong Kong  for a continuous period of seven years will be eligible for exemption of the BSD

Is a company and its directors liable to pay BSD?

A company and/or its directors regardless of residential status is liable to pay BSD.

If a flat is purchased jointly by a permanent resident and a non permanent resident , will BSD be payable?

Yes and No, Scenarios Below:-
NO: If non permanent resident is a close relative ie: spouse,parents,brother or sister
YES: If non permanent resident is a friend, or distant relative ie: in laws. (In this case BSD is chargeable on the total value irrespective of share of each party).

Is BDS payable for inherited property whereby beneficiary is a non permanent resident?

NO BSD is chargeable in this scenerio.

 When should BSD be paid?

With 30 days of signing a chargeable document eg: Provisional Agreement to purchase

Can BSD. Be refunded should the sale be canceled?

Yes the buyer can apply for a refund of the BSD within 2 years of the cancellation

What circumstances will BSD be exempted?

The Government has a comprehensive website outlining additional circumstances where BSD maybe exempted.

Will a transfer of Company Ownership holding a property be Liable for BSD?

No BSD will not be payable for a company transfer for directorship.

Is BSD applicable for purchase of Commercial Properties?

With effect from 27 October 2012, unless specifically exempted, Buyer’s Stamp Duty (BSD) is payable on an agreement for sale for the acquisition of any residential property only.

For More information on Buyers Stamp Duty and Other Stamp Duties when buying or selling property in Hong Kong, Contact Anthony via email; anthony@qi-homes.com