By Kai Ioh | August 2025
Why August 20 Matters for Every Big Island Property Owner
If you own property on the Big Island, August 20 – yes, just around the corner- is the next due date for Hawaii County real property taxes. For many, it’s just another bill. But understanding how that number is calculated and how much you might be able to save can make a significant difference.
Whether you’re a first-time homeowner, a longtime local, or an out-of-state investor, knowing the basics of Big Island property tax can help you stay ahead of surprises, avoid penalties, and even reduce your annual tax bill.
What Is Hawaii County Real Property Tax?
Hawaii County real property tax is a local tax levied by the County of Hawai‘i – not the state – on real estate, including land and buildings. Revenue collected from property taxes helps fund essential public services like police, fire departments, waste management, parks, and public facilities across the Big Island.
Unlike many mainland markets, Hawaii’s property tax is assessed and collected only at the county level. That means rates, exemptions, and classifications can vary from island to island – and understanding Hawaii County’s (Big Island) specific structure is key to managing your property well.
How Property Tax Is Calculated
Your annual property tax is calculated using a simple formula:
(Assessed Value – Exemptions) ÷ 1,000 × Tax Rate = Annual Property Tax
- Assessed Value: Determined annually by the Real Property Assessment Division based on current market value. Property owners can appeal the assessed value if one thinks it is too high. It is important to review the assessed value notice, typically mailed in March.
- Tax Rate: Varies depending on your property’s classification (residential, homeowner, agricultural, commercial, etc.).
- Exemptions: Eligible reductions that lower the taxable value of your property.
Example: If your owner-occupied home (under $2M) is assessed at $500,000 and you qualify for an $80,000 exemption:
- Taxable Value = $420,000
- Tax Rate = 0.615%
- Property Tax = $2,583/year
Property Tax Rates by Classification
Hawaii County sets different rates for different types of property. These are applied per $1,000 of assessed value:
- Homeowner: $6.15 per $1,000 (0.615%)
- Residential, Non-resident (<$2M): $11.10 (1.110%)
- Residential, Non-resident (>$2M): $13.60 (1.360%)
- Affordable Rental: $6.15 (0.615%)
- Agricultural: $9.35 (0.935%)
- Commercial/Industrial: $10.70 (1.070%)
These rates are subject to annual adjustments by the County Council.
Key Exemptions That Can Lower Your Tax Bill
One of the most powerful tools for reducing your property tax is the homeowner exemption, available to those who occupy their property for more than 200 days per year.
Homeowner Exemption Amounts by Age (as of Jan 1, 2025):
- Under 60: $50,000
- Age 60–64: $85,000
- Age 65–69: $90,000
- Age 70–74: $105,000
- Age 75–79: $110,000
- Age 80+: $125,000
Other Exemptions and Programs:
- Agricultural Use: Special assessments for bona fide farming operations
- Affordable Rentals: For qualifying long-term rental properties
- Green Energy Improvements: Solar systems and energy-efficient upgrades
To qualify, applications must be filed with the County and include documents like proof of age, residency, and property use.
Tips to Stay Compliant
- Mark August 20 & February 20 on your calendar (biannual due dates)
- Apply for exemptions early and keep documentation updated
- Double-check your classification and assessed value annually
- Consult a local CPA or tax advisor for more advanced planning
All exemption forms, deadlines, and classification rules are available through the County of Hawai‘i Real Property Tax Office. Here is the LINK.
Final Word: The Cost of Paradise Can Be Managed
Owning real estate on the Big Island is an incredible opportunity—and while the cost of paradise comes with responsibility, it doesn’t have to come with surprises.
Take a few minutes to review your latest property tax bill. See if you qualify for any exemptions. If you have questions, reach out.