Inheritance Tax and Estate Duty in Hong Kong: The Complete Guide

Hong Kong is one of the few developed jurisdictions with no inheritance tax and no estate duty. Estate duty was abolished for deaths on or after 11 February 2006, and nothing has replaced it. That is a genuine advantage for families holding assets in Hong Kong, but it comes with a trap: many Hong Kong residents and their heirs still face foreign death taxes, most often United Kingdom inheritance tax or United States estate tax, because of where they are domiciled or where their assets are located. This guide sets out the Hong Kong position first, then the cross-border exposure that actually catches people out.

No. There is no inheritance tax, estate tax, gift tax or succession duty in Hong Kong. When a person dies, their estate is not taxed on its value, and beneficiaries do not pay any tax on what they inherit. The only levy that ever applied to estates, estate duty, was abolished in 2006.

This means that, for a purely domestic Hong Kong estate, the cost of passing wealth on death is limited to administration costs, not tax: the Probate Registry filing fees, valuation and professional fees, and the time involved in obtaining a grant of representation. There is no tax return to file with the Inland Revenue Department in respect of the death itself.

Estate duty was abolished by the Revenue (Abolition of Estate Duty) Ordinance 2005, which took effect on 11 February 2006. For any death on or after that date, no estate duty affidavits or accounts need to be filed, and no estate duty clearance is required before applying for a grant of representation.

The original Estate Duty Ordinance (Cap. 111) still sits on the statute book, but it is effectively dormant: it only applies to deaths before 11 February 2006. A short transitional rule reduced the duty to a nominal HK$100 for estates of people who died between 15 July 2005 and 11 February 2006 where the estate exceeded HK$7.5 million. In practice, for anyone administering a present-day estate, estate duty is simply not a consideration.

It helps to separate tax from cost. On a Hong Kong estate:

• No estate duty or inheritance tax on the value of the estate.
• No stamp duty on the transmission of assets to the personal representative or to beneficiaries on death (a transfer on death is not a sale).
• Probate Registry fees and professional costs still apply, as does the time needed to obtain the grant.
• Ordinary income taxes continue during administration: if the estate earns rental or business profits after death, the usual Hong Kong profits or property tax rules under the Inland Revenue Ordinance (Cap. 112) can apply to that income. This is tax on income, not on the inheritance itself.

The absence of Hong Kong estate duty does not make an estate tax-free worldwide. Two questions decide foreign exposure: where the deceased was domiciled (a concept different from tax residence), and where each asset is located (its “situs”). The two most common exposures for Hong Kong families are the UK and the US.

The figures below are indicative as at 2026 and are governed by foreign law that changes frequently. They are a starting point for a conversation, not advice on UK or US tax. Specialist advice in the relevant jurisdiction is essential.

United Kingdom inheritance tax (IHT)

• The headline rate is 40% on the value of an estate above the tax-free threshold. UK-situs assets (for example a UK property or UK-registered shares) are generally within the UK net wherever the owner lives.
• A person’s connection to the UK for IHT purposes moved from a domicile-based test to a residence-based test from 6 April 2025. Long-term UK residents can be exposed to IHT on their worldwide estate, including Hong Kong assets, while those with no such connection are generally taxed only on UK-situs assets. The exact rules and thresholds should be confirmed with a UK adviser.
• Lifetime gifting can reduce exposure, but UK rules look back several years and interact with UK capital gains tax, so gifts need to be planned, not improvised.

United States estate tax

• Non-US individuals who hold US-situs assets (typically US-listed shares held directly, or US real estate) can face US estate tax of up to 40%, with only a small exemption for non-resident aliens. The threshold at which US-situs assets become taxable is far lower than most people expect.
• How US shares are held (directly, through a fund, or through a holding structure) can change the exposure significantly.

Mainland China and other jurisdictions

• Mainland China currently has no inheritance tax, though the subject is periodically debated. Other jurisdictions where a family holds property (for example France, Japan or Korea) may levy succession tax on assets located there. Each asset should be checked against the rules of the place where it sits.

A common misconception is that holding wealth in Hong Kong shields it from all death taxes. It does not. A Hong Kong bank account or Hong Kong company shares can still form part of a UK-connected person’s worldwide estate for IHT. A portfolio of US shares held through a Hong Kong brokerage is still a US-situs asset for US estate tax. The place of the account or the adviser does not change the situs of the underlying asset or the domicile of the owner.

This is why cross-border families should look at their estate as a map of assets and connections, not as a single Hong Kong pot. The planning that follows, holding structures, trusts, the choice of which assets to hold directly, and coordinated wills across jurisdictions, is where real exposure is reduced.

Because Hong Kong itself imposes no death tax, the planning question is almost always about foreign exposure and smooth administration, not about Hong Kong tax mitigation. Typical steps include:

• Mapping domicile and situs across the whole estate to see which assets are exposed to UK, US or other death taxes.
• Structuring how foreign-situs assets are held, for example the way US shares are owned, to manage exposure.
• Using trusts or a family office where appropriate for succession and governance, not only tax. See our guide to the Hong Kong family office regime.
• Coordinated wills so a Hong Kong will and any foreign will work together rather than revoking each other. See our Hong Kong wills guide.
• Planning the grant so that a foreign executor can administer Hong Kong assets efficiently. See our international probate service.