For businesses filing tax returns in 2026, the HK$3,000 relief is a one-off profits tax reduction for the 2025/26 year of assessment. It reduces final tax payable by 100%, capped at HK$3,000 per business. It is not an allowance deducted from assessable profits.
Which year does it cover?
Introduced in the 2026/27 Budget, the measure applies to the 2025/26 final assessment. The legislation passed on 13 May 2026 and was gazetted on 22 May 2026.
How much can your business save?
The reduction is the lower of final profits tax payable before this relief and HK$3,000. These simplified examples exclude provisional tax and other tax bill items:
- Tax of HK$2,000: reduction of HK$2,000; remaining final tax of HK$0.
- Tax of HK$8,000: reduction of HK$3,000; remaining final tax of HK$5,000.
- No profits tax payable: the measure does not provide a HK$3,000 cash payment.
Is a separate application needed?
File the 2025/26 profits tax return as usual. The Inland Revenue Department (IRD) applies the reduction during assessment; no separate application is required. Relevant assessments issued before the legislation passed will be revised by the IRD.
Provisional tax must still be paid on time
The relief applies to the 2025/26 final assessment, not that year's provisional tax. Pay tax bills by their stated due dates. Provisional tax already paid is applied towards the relevant final tax and the following year's provisional tax; any remaining balance is refunded.
Practical filing reminders
Organise accounting records and supporting documents, check the year of assessment, and review the assessment notice for the applicable reduction. Do not treat HK$3,000 as a recurring annual allowance or deduct it from the total tax bill yourself.
For help with accounting records or company tax filing, contact CLG.
Sources: IRD: 2026/27 Budget tax measures and related IRD FAQs. Information checked on 4 November 2026. This article provides general information; treatment depends on the circumstances of each business and the IRD's assessment.
