The Hong Kong Inland Revenue Department announced on 1 November 2024 that starting from 4 November 2024, the new annual rate of interest payable on Tax Reserve Certificates will be 0.7167% against the current rate of 0.8000%, i.e., the new rate will be HKD 0.0597 per month per HKD 100.
Tax Reserve Certificates bear simple interest, and interest is calculated monthly (including part of a month) from the date of purchase to the date of tax payment. Interest is only credited when certificates are used to pay tax, and no interest is due where the principal value of a certificate is repaid to its holder.
The interest rate payable on Tax Reserve Certificates is reviewed monthly based on the average prevailing interest rate for the 12-month time deposit for HKD 100,000 to HKD 499,999 offered by the three note-issuing banks.
The new rate will apply to all certificates purchased on or after 4 November 2024. Certificates purchased before 4 November 2024 will continue to earn interest at the rates prevailing on their respective purchase dates. As per the general rules, interest on Tax Reserve Certificates will cease to accrue after 36 months.
Below is a summary of the interest rates for the past periods:
- For certificates purchased on or after 3 April 2023 and before 5 June 2023: 0.7667% per annum
- For certificates purchased on or after 5 June 2023 and before 7 August 2023: 0.8083% per annum
- For certificates purchased on or after 7 August 2023 and before 4 September 2023: 0.8833% per annum
- For certificates purchased on or after 4 September 2023 and before 3 June 2024: 0.9250% per annum
- For certificates purchased on or after 3 June 2024 and before 7 October 2024: 0.8833% per annum
- For certificates purchased on or after 7 October 2024 and before 4 November 2024: 0.8000% per annum
- For certificates purchased on or after 4 November 2024, until further notice: 0.7167% per annum
