Banking, Money and Taxes in Hong Kong

Hong Kong is a premiere international financial centre, and it follows that expats will likely have little trouble managing their money while abroad. Basic banking in Hong Kong is safe, secure, sophisticated and straight-forward, and the slightly more complex private banking industry is the largest in Asia.
 

The currency in Hong Kong is the Hong Kong Dollar, abbreviated as HKD or HK$. Each HKD is divided into 100 cents.

Since 1980 it’s been pegged to the US dollar at 1 USD = 7.80 HKD, and thus as the American currency depreciates so does the value of this Asian currency.

Strangely enough, three different banks in Hong Kong are responsible for issuing bank notes, thus expats can expect bills to vary in colour and design for each denomination.

Automated Teller Machines (ATMs) are found everywhere in Hong Kong, and most accept international money systems (Maestro, Plus, Cirrus and Visa Electron). ATMs are generally open even after their attached bank branches have closed.

You can change money at banks and at licensed moneychangers, such as Chequepoint, at the airport and even at some hotels in Hong Kong. Banks generally offer the best rates, but do be aware that some institutions levy hefty charges for this transaction if you’re not an account holder. The airports offer the worst rates, which are only slightly bettered by hotels.
 

As the financial hub of Asia, Hong Kong is home to many major international banks, as well as a handful of local Chinese institutions. Both options have their pros and cons, and the best option is unique to each individual circumstance.

Expats who already have an account with an international service provider, like HSBC, Citibank or Standard Chartered Bank, often find it easy and convenient to continue using this institution, and to open a local version of an account upon arrival in Hong Kong. Among other things, transferring money becomes less of a hassle and more economical.

Expats who do not have a home-country bank represented in Hong Kong, and even those who do, may nonetheless want to explore options like Bank of China and Hang Seng Bank, ATMs for both are commonplace and the maintenance fees for basic current, cheque and savings accounts are minimal.

Most bank  branches have employees who can communicate in English, though language proficiency improves in the main expat areas (i.e. Mid-Levels and Repulse Bay). Thus if you have a complicated issue, it may be best to go to a branch in one of these districts.

Nearly all banks have Internet banking facilities and offer credit cards.

Banks are generally open from 8.30am to 5pm, Monday to Friday, and from 8.30am to 12.30pm on Saturday. Times can vary among branches.
 

It’s easy to open a bank account in Hong Kong, and even tourists can complete the process. The minimum amount necessary to maintain a basic current, cheque or savings account varies depending on the service provider and the account type.

Otherwise, head to your selected institution with proof of residency, identification and your employment contract, and the process will be completed in minimal time.

Documents needed to open a bank account in Hong Kong

Hong Kong claims extremely low income tax rates, and has completely done away with sales tax, capital gains tax, and VAT. Families with kids are entitled to lucrative special allowances, and even wealthy single foreigners will never pay more than 17 percent in taxes. This is an important point to figure in, when evaluating your remuneration package.
 

Expats should also investigate if their home country has a double taxation agreement with Hong Kong. If so, then they are not liable to pay tax in both Hong Kong and their home country.