What is tenancy stamp duty? Failure to stamp the tenancy agreement may lead to legal action.

When renting a property in Hong Kong, tenants usually need to pay stamp duty on the tenancy agreement, commonly known as “stamping the tenancy”. Whether it is a residential unit, a shop, or even a car park lease, once a tenancy agreement is signed, stamp duty is usually payable in accordance with the regulations, and the lease must be stamped.

Stamping is not merely a tax procedure; it is also relevant to whether the tenancy agreement can later be used as evidence in court. If the tenancy agreement has not been stamped, difficulties may arise if issues such as rent arrears, deposit disputes, or early termination occur, and both parties may face challenges in protecting their rights. 10Life has compiled the meaning, rates, calculation methods, application deadline, late filing penalties, and how to deal with a landlord refusing to stamp the tenancy agreement.
 

• Tenancy stamp duty is commonly known as “stamping the agreement” 
• It is generally required to be completed within 30 days after the tenancy agreement is signed 
• The landlord, tenant and sub-tenant are all legally responsible for payment 
• Market practice is usually for the landlord and tenant to pay half each 
• An unstamped tenancy agreement cannot be used as evidence in civil proceedings 
• Late stamping may result in a fine of up to 10 times the amount of stamp duty payable 
• Car park lease agreements generally also need to be stamped 

Tenancy stamp duty refers to the submission of a signed tenancy agreement to the Inland Revenue Department for stamping, with the corresponding tax paid in accordance with the Stamp Duty Ordinance. Once stamping is completed, the tenancy agreement becomes an officially stamped document.
In simple terms, stamping serves three main purposes:

Confirming the formality of the tenancy document

After stamping, the tenancy agreement will have an official stamp record, proving that the document has completed the relevant legal procedures.  

Protecting the rights of landlords and tenants

If a tenancy dispute arises later, such as rent arrears, deposit disputes or early termination of the tenancy, a stamped tenancy agreement can serve as important evidence.  

Complying with other statutory procedures

If the tenancy agreement needs to be registered with the Land Registry, for example where the tenancy term exceeds 3 years, stamping is generally required first.  
 

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An unstamped tenancy agreement does not in itself necessarily constitute a criminal offence. However, under the Stamp Duty Ordinance, an unstamped tenancy agreement cannot be used as evidence in civil proceedings. In other words, if a tenancy dispute arises, even if both parties have signed the tenancy agreement, if it has not been stamped, it may not be admissible directly as evidence in court.

Common situations affected include:

• landlords recovering rent arrears 
• tenants recovering the deposit 
• disputes over early termination of the tenancy 
• disputes over rent increases or lease renewals 
• disputes over compensation for damage 

Therefore, stamping is not merely an administrative procedure, but an important step in safeguarding the rights and interests of both parties.
 

According to Hong Kong law, all parties signing the tenancy agreement are responsible for paying stamp duty, including:

• the landlord 
• the tenant 

However, who actually bears the cost usually depends on the tenancy terms and the agreement between both parties. A common practice in Hong Kong’s rental market is for the landlord and tenant to bear the cost equally.
It is advisable to clearly specify before signing:

• who is responsible for arranging stamping
• who will pay the stamp duty 
• whether the cost is split equally between both parties 
• how the cost of copies will be shared 

This can help avoid disputes later over费用.
 

Some landlords may be unwilling to stamp a tenancy agreement for various reasons, and tenants should pay particular attention to the risks involved.

1. Possible concealment of rental income
   After leasing out a property, landlords are generally required to declare rental income for tax purposes. If a landlord refuses to stamp the agreement, it may be because they wish to avoid leaving an official record of the tenancy, thereby concealing rental income.
   For tenants, this not only weakens the legal protection of the tenancy agreement, but may also make any future dispute more difficult to handle.
2. Possible unlawful letting
   A landlord’s refusal to stamp the agreement may also be related to restrictions on letting the property itself. For example:

• letting a Home Ownership Scheme flat without paying the land premium 
• unlawful letting of a public housing unit 
• unauthorised subletting or partitioned-flat arrangements 
• the property’s permitted use does not match the intended leasing use 

If tenants find that the landlord has been repeatedly avoiding stamping, they should stay vigilant and understand whether the letting is lawful.
 

Even if the landlord is unwilling to co-operate, the tenant may still apply to the Inland Revenue Department to have the tenancy stamped, without first obtaining the landlord’s consent.

1. Tenants may handle this as follows:
2. Keep a copy of the signed tenancy agreement 
3. Retain records of communications with the landlord 
4. Apply to the Inland Revenue Department for stamping on their own 
5. Pay the required stamp duty first 
6. Recover the landlord’s share later in accordance with the tenancy terms or by mutual agreement 
7. If the matter involves a more complex tenancy dispute, it is advisable to seek legal advice.
    

Assuming a monthly rent of HK$20,000 for a tenancy term of 2 years:

• Total rent: HK$20,000 × 24 months = HK$480,000 
• Average annual rent: HK$480,000 ÷ 2 = HK$240,000 
• As the tenancy term exceeds 1 year but does not exceed 3 years, the tax rate is 0.5% 
• Stamp duty: HK$240,000 × 0.5% = HK$1,200 

If the tenancy agreement is made in duplicate, an additional HK$5 is payable for each copy, i.e. HK$10 in total. Therefore, the total cost is:

1,200 + 10 = HK$1,210

If the landlord and tenant each pay half, each party would pay approximately HK$605.
 

A tenancy agreement generally needs to be stamped within 30 days after the date of signing. Please note that the 30-day period is counted from the “date of signing”, rather than from the tenancy commencement date or the move-in date.

For example:

• Tenancy agreement signing date: 1 January 
• Tenancy commencement date: 1 February 

Even if the tenancy only takes effect in February, it should still be stamped on or before 31 January.

If stamping cannot be completed within 30 days, a penalty may be payable when it is later arranged.
The general penalty arrangements are as follows:

• Late by no more than 1 month: 2 times the stamp duty payable
• Late by more than 1 month but no more than 2 months: 4 times the stamp duty payable
• Late by more than 2 months: 10 times the stamp duty payable

Even if the amount of stamp duty is not high, late penalties may still significantly increase the overall cost. Therefore, it should be arranged as soon as possible after signing the tenancy agreement.
 

1. Online stamping

Online stamping is a more convenient method. Applicants can submit the required information and make payment via the Inland Revenue Department’s e-Stamping Service, and then download the electronic stamp certificate once completed.
The general process includes:

1. Log in to the e-Stamping Service 
2. Complete the tenancy agreement details 
3. Fill in the landlord and tenant information 
4. Confirm the tenancy period and rent 
5. Pay the stamp duty
6. Download the stamp certificate 

2. Postal application

Applicants may also complete the relevant application form and post it together with a cheque to the Inland Revenue Department for processing. In general, the Inland Revenue Department will process the application after receiving it and the payment, and will post back the stamp certificate.

3. In-person application

Applicants may make an appointment to visit the Inland Revenue Department counter to complete the process. Before attending in person, they should prepare the tenancy agreement details, application form and payment method in advance, so as to avoid delays due to insufficient documents.
 

Yes. A parking space is also a form of property lease, and stamp duty should generally be paid within 30 days after signing the tenancy agreement. Even if the parking space rent is lower than that of a residential property, or the tenancy is in a simpler form, this does not mean it is exempt from stamp duty. If it is not stamped, the parking space tenancy agreement may likewise not be admissible as evidence in civil proceedings.

1. Is it illegal not to stamp a tenancy agreement?

Failing to stamp a tenancy agreement does not, in itself, necessarily constitute a criminal offence, but an unstamped tenancy agreement cannot be used as evidence in civil proceedings. If a tenancy dispute arises in future, this may affect the landlord’s or tenant’s ability to protect their rights.

2. When should a tenancy agreement be stamped?

In general, it should be stamped within 30 days after the tenancy agreement is signed. The deadline is counted from the date of signing, rather than from the move-in date or the date the tenancy takes effect.

3. Who pays the stamp duty for a tenancy agreement?

Under the law, all signatories are responsible for paying the stamp duty. However, market practice is usually for the landlord and tenant to each pay half, and the actual arrangement should depend on the tenancy terms.

7. If the tenancy agreement has expired, can it still be stamped retrospectively?

Yes, but a late penalty may be payable. If there is a reasonable cause for the delay, a written explanation may be submitted to the Inland Revenue Department. The Department will consider, on a case-by-case basis, whether part of the penalty should be waived.
 

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This English version of this article has been generated by machine translation powered by AI. It is provided solely for reference purposes. In the event of any discrepancy or inconsistency between this translation and the original Chinese version, the Chinese version shall prevail.