The Inland Revenue Department (IRD) held a press conference on May 2, 2025, to discuss the details of the 2024/25 tax year returns, the overall tax revenue for the year, and the launch of a new website under the "Tax Easy" initiative. Commissioner of Inland Revenue, Eliza Chan, announced that the department has issued a total of 2.66 million tax returns, which includes approximately 790,000 electronic tax returns and 1.87 million paper tax returns. This marks an increase of 220,000 tax returns compared to the previous year, indicating a growing taxpayer population for the second consecutive year.
Taxpayers can begin filing their electronic tax returns immediately, or they can expect to receive a mailed tax return in the next day or two. General individuals are required to submit their tax returns on or before June 2, 2025, while those engaged in sole proprietorship businesses must submit theirs by August 2, 2025. If taxpayers choose to file their returns online, they can automatically extend their submission deadline by one month, pushing it to July 2, 2025. Those operating sole proprietorships can extend their deadline to September 2, 2025. The IRD has urged taxpayers to submit their returns on time to avoid any complications.
During the press conference, Chan revealed that the provisional overall tax revenue for the 2024/25 fiscal year is estimated at HK$374.5 billion, representing an increase of HK$32.5 billion or 10% from the previous year. This growth is attributed to various factors, including an increase in salaries tax revenue, which stands at HK$88.9 billion, reflecting an 11% rise; profits tax revenue, which is HK$177.7 billion, has increased by 4%; and stamp duty revenue, which has skyrocketed to HK$63.9 billion, an impressive 30% increase.
Chan explained that the increase in salaries tax revenue can be attributed to several factors. The rise in taxable income among taxpayers has led to more individuals falling within the tax net. Additionally, the number of taxpayers has increased due to the implementation of talent import schemes, which have attracted more professionals who are now liable for salaries tax. Furthermore, there has been a decrease in the number of individuals applying for deferred tax payments, which has also contributed to the increase in taxpayer numbers.
In light of the current economic climate, the IRD has observed that citizens' ability to pay taxes has been impacted. The total tax arrears have reached HK$69.49 billion, with salaries tax arrears amounting to HK$35.29 billion, which is nearly a 2% increase from HK$34.64 billion in the previous year. The number of applications for deferred tax payments has also risen significantly, with 4,700 cases for profits tax and a staggering 66,100 cases for salaries tax, marking an increase of 19.3% from the previous year's figures.
Looking ahead, the 2025/26 budget will introduce tax relief measures that include a 100% reduction in salaries tax, personal income tax, and profits tax for the 2024/25 tax year, with a cap of HK$1,500 per case. Taxpayers will not need to make a declaration, as these reductions will be automatically reflected in their assessments.
Additionally, the IRD anticipates that the overall tax revenue for the 2025/26 fiscal year will be HK$401.4 billion, which represents a 7% increase from the current year. This projection is based on the expected rise in the number of newly established companies and the anticipated increase in citizens' salaries.
Chan emphasized the importance of timely submissions, reminding taxpayers to ensure their returns are signed and that they include sufficient postage when mailing their tax returns. The IRD has a dedicated telephone hotline at 1878022, which will be operational from May 2, 2025, until June 2, 2025. The department has extended its inquiry service hours to accommodate taxpayers, operating from Monday to Friday, 8:15 AM to 7:00 PM, and on Saturdays from 9:00 AM to 1:00 PM.
In a significant move to improve taxpayer services, the IRD will launch three new tax websites in July 2025 under the "Tax Easy" system. These include a personal tax website, a business tax website, and a tax representative website. All personal tax services currently provided through "Tax Easy" will be migrated to the personal tax website, and a personal tax website application will be launched simultaneously, allowing taxpayers to log in and utilize services with biometric authentication. The business tax website and tax representative website will cater specifically to companies and service agents.
In summary, the IRD's recent press conference highlighted the increasing taxpayer population and the growth in overall tax revenue, while also addressing the challenges posed by the current economic conditions. Taxpayers are encouraged to take advantage of the new initiatives and ensure they meet their filing obligations promptly.
