Total recurring government charges combined.
Total annual charges
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Rates (net)
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Government rent
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Per quarter
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Your breakdown
Updates live as you type| Charge | Basis | Annual amount |
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Two charges, one demand note
Most Hong Kong owners receive a single quarterly demand from the Rating and Valuation Department and assume it is one tax. It is actually two. Rates fund municipal services and are charged on a banded or flat percentage of rateable value. Government rent is a separate annual charge that the Government levies on land held under leases granted or extended since 1985, and it is a flat 3 percent of the same rateable value. This tool adds them so you see the true recurring cost of holding a property, not just the rates line that most calculators stop at.
Because both charges sit on the same rateable value, an upward revaluation lifts both at once. That compounding is the reason the combined number deserves its own calculation rather than a mental estimate.
Where the two charges come from
Rates apply to almost all occupied premises. For non-domestic units the figure modelled here is a flat 5 percent of rateable value. For domestic units the calculator uses progressive bands, with the lowest slice at 5 percent. Government rent, by contrast, has no bands at all and no concession attached to it. The rates concession announced in the 2025/26 Budget waives rates for the first quarter up to $500, but it does nothing for the government rent line. Treat the 5 percent and 3 percent figures as the tool's assumptions and confirm them with the Rating and Valuation Department and the Lands Department.
Adding it up for a $240,000 rateable value
Consider a domestic flat with a rateable value of $240,000, the calculator's default. The whole rateable value sits inside the first domestic band, so rates are simply 5 percent of $240,000. Government rent is 3 percent of the same base. The concession trims the rates line by $500 in the first quarter. The combined result below is what the tool returns.
Government rent is more than a third of this combined bill, which is exactly why leaving it out of a holding-cost estimate understates the real number.
A point of confusion worth clearing up
Not every property pays government rent at 3 percent. Some older land lots held under pre-1985 leases pay a small fixed Crown rent instead, and the position can differ in parts of the New Territories. If your demand note shows a government rent figure that is not 3 percent of rateable value, this tool's assumption does not fit your lease, and you should read the demand note's breakdown directly. The tool is built for the common post-1985 case, which covers most modern flats.
One thing that never appears on this bill is any tax on the property's capital value or your gain when you sell. Hong Kong has no capital gains tax and no annual property value tax, so rates and government rent really are the whole recurring story for an owner-occupier.
Can a tenancy make the tenant pay rates and government rent?
Yes. Liability in law usually rests with the occupier for rates, but tenancy agreements routinely reallocate who bears rates and government rent. Read your lease: a tenant may be contractually responsible for one, both, or neither, regardless of whose name the demand note carries.
Does the rates concession reduce my government rent too?
No. The 2025/26 concession modelled here applies only to rates, and only for the first quarter up to $500. Government rent is billed in full all year, so the saving you see in the calculator comes entirely from the rates line.