Child Allowance Tax Saving Calculator
From the number of children and marginal tax rate, estimate the Hong Kong child allowance tax saving (HK$130,000 per child).
Input Data
Results
At a glance:The US Child Tax Credit directly reduces tax owed per child. Hong Kong has no identical credit, but a 'child allowance' gives similar relief: HK$130,000 per child for 2025/26, plus an equal extra in the year of birth (HK$260,000 that year). Because it is an allowance (not a credit), the saving = allowance x marginal rate. Example: 2 children at 17% → 260,000 x 17% = HK$44,200. The key difference: a US credit cuts tax by a fixed amount; HK's allowance cuts taxable income, so the benefit scales with your marginal rate — higher earners save more per dollar of allowance. This calculator estimates the salaries-tax saving for family planning. WARNING: Estimate only — actual saving depends on total income, other allowances/deductions and the standard-rate cap; part of the allowance may sit in a lower band. Allowance applies to children under 18, or 18-25 in full-time education, claimed by one parent. Follow the IRD.
Formula
Total allowance = per-child allowance × children + per-child allowance × newborns (birth-year extra).
Estimated tax saving = total allowance × marginal rate.
Note: allowance reduces taxable income, so the saving scales with the marginal rate.
$$A = P\times N + P\times N_{newborn}$$$$\text{Tax Saving} = A\times r_{marginal}$$How to Use
- Enter the number of qualifying children.
- Enter any newborns in the year of assessment (extra equal allowance).
- Confirm the per-child allowance (default HK$130,000).
- Enter your marginal rate to see the allowance and saving.
FAQ
Does Hong Kong have a Child Tax Credit like the US?
No direct tax credit, but the 'child allowance' gives similar relief. For 2025/26 it is HK$130,000 per child, plus an equal extra in the year of birth. As an allowance (not a credit), the saving = allowance x marginal rate.
What is the difference between an allowance and a tax credit?
An allowance reduces taxable income — the benefit depends on your marginal rate (higher earners gain more). A tax credit directly reduces the tax bill by a fixed amount, regardless of rate. Hong Kong uses the allowance approach.
Which children qualify?
Children under 18, or aged 18-25 in full-time education, or any age if incapacitated due to physical/mental disability. Only one parent may claim each child's allowance.
How does the newborn extra allowance work?
A child born in the year of assessment gets the basic allowance plus an equal extra that year — HK$260,000 in total; from the following year it reverts to the basic HK$130,000. Remember to claim it when you file.
Is this saving an exact tax figure?
It is an estimate. The actual saving depends on your total income, other allowances and deductions, and whether the standard rate cap applies. Under progressive bands, part of the allowance may fall in a lower band, so this tool uses a single marginal rate for simplicity; for actual filing, follow the IRD's assessment.
Related Tools
References
This calculator's content is reviewed by our Licensed Tax Advisory team. Results are for reference only; please refer to the relevant authorities for the official figures.