1. What are rates exemptions?
Rates exemptions take two forms. One is exemption from assessment to rates, whereby no assessment will appear in the Valuation List. The other is exemption from payment of rates, where an assessment is included in the Valuation List but is exempt from payment of rates by administrative means.
2. Which types of tenements are exempt from assessment to rates?
The statutory provisions under which tenements are exempt from assessment to rates are contained in Section 36(1) of the Rating Ordinance (Cap 116). Some examples of the tenements which are exempt from assessment to rates are :
- Agricultural land and buildings;
- New Territories dwelling houses occupied in connection with agricultural land or agricultural operations;
- New Territories village houses within Designated Village Areas, complying with the prescribed criteria on size, height and type;
- Tenements built for the purpose of public religious worship and used wholly or mainly for such purpose;
- Certain resited village houses in the New Territories; and
- Properties of which the rateable value does not exceed the prescribed amount. The amount will be reviewed during each General Revaluation.
3. Which types of tenements are exempt from payment?
Exemption from payment of rates is provided for in the Rating (Miscellaneous Exemptions) Order made under Section 36(2) and (3) of the Rating Ordinance.
Section 36(2) gives the Chief Executive in Council the power to declare any class of tenement or area to be exempted from payment of rates. For example, all tenements, or parts thereof, used wholly or mainly for public religious worship, other than those exempt from assessment under Section 36(1) of the Rating Ordinance, are exempt. This provision gives exemption to non-purpose-built premises.
Section 36(3) authorises the Chief Executive to exempt any tenement or part of any tenement from the payment of rates, wholly or in part. This provision is limited to particular tenements, and not class of tenements. For example, village houses situated outside a Designated Village Area may be eligible for exemption from payment of rates, provided they are occupied (or are vacant and intended to be occupied) by indigenous villagers or their immediate family members for domestic purposes and the village houses satisfy the prescribed criteria on size, height and type. Application for exemption on these grounds has to be submitted to the Director of Home Affairs who is the approving authority for granting exemption relating to village houses occupied by indigenous villagers.
4. What kinds of agricultural land and buildings are exempt from assessment to rates?
Agricultural land is defined in the Rating Ordinance as “land used as farm land, a fish pond, a market garden, a nursery ground, an orchard or for animal husbandry”. For practical purposes, this definition is taken to include all normal agricultural purposes, including, for example, oyster beds and land used for flower and tree blossom growing. Nevertheless, where land is used primarily for the sale of agricultural products rather than growing, the tenement would not be exempted.
Agricultural buildings include any structures other than a dwelling house, situated on, or adjacent to agricultural land used wholly or mainly in connection with such land. Dwelling houses are separately exempted if they are occupied in connection with agricultural land, or used as the dwelling of any person engaged wholly or mainly in the agricultural operations on that land.
5. What types of village houses in the New Territories are exempt from assessment to rates?
Under Section 36(1)(c), village houses are exempted from assessment to rates provided they meet the specified criteria on size, height and type and are within the boundaries of areas designated by the Chief Executive for this purpose. Such areas are called Designated Village Areas.
6. What factors are considered when granting exemption to a property used for public religious worship purpose?
Section 36(1)(d) provides exemption for tenements which are built for public religious worship and used wholly or mainly for such purpose. This exemption requires not only that the premises are built and used for religious worship but also that they must be open to the public for such purpose. Purpose-built churches and temples are not assessed to rates if they fulfill that criterion.
Where premises are merely adapted for that use, they will be eligible for exemption from payment of rates under the Rating (Miscellaneous Exemption) Order. Similarly they must be open to the public for religious worship. Exemption may be refused where the premises are used for religious purposes only on an occasional basis.
7. What are resited village houses?
Resited village houses are houses made available by the Government within resited villages in exchange for land resumed by the Government from the former owners of such land. Such resumptions have typically resulted from village removal schemes for construction of reservoirs, new towns or other development projects in the New Territories. The resited village houses may have been built either by the Government or by private individuals with government financial assistance. Such resited village houses are exempted from assessment to rates regardless of occupation and ownership status.
8. My resited village house currently exempted from assessment to rates will be redeveloped. Will the house still be exempted after redevelopment?
No. The house will not be exempted from assessment to rates when it is redeveloped.
9. What is minimum rateable value?
Any tenement for which the rateable value does not exceed an amount prescribed by resolution of the Legislative Council is exempted from assessment to rates. The prescribed amount is reviewed during each General Revaluation. For the current financial year, the amount is $3,000. The purpose of this exemption is primarily to avoid administrative cost where the rates revenue is likely to be less than the cost of maintaining the assessment and collecting the rates revenue.
10. How can I apply for rates exemption for my property?
If you consider your property is eligible for rates exemption, please write to this Department quoting the assessment number and the address of the property concerned. You should also provide the ground for making the application and your contact details. You may be required to provide supporting information to substantiate your application.