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https://www.octopus.com.hk/en/document/user_guide.pdf (mirror) states:

If the value on your Octopus is positive (HK$0.10 or above) but insufficient to cover the full amount of the transaction, you can still complete the transaction by incurring a negative value of up to HK$35* on a single occasion which will be automatically recovered when your Octopus is next reloaded.

What happens if my MTR ride goes over my Octopus balance + 35 HKD when I try using my Octopus card while exiting the MTR station?

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    Interestingly I never encountered that scenario (perhaps I have never taken trips that cost more than 35 HKD). Though multiple posts on forums say that you are not going to get out, and have to go to the customer service centre (which usually has two windows, allowing access from both inside and outside the gates) to top up first. – B.Liu Oct 31 '19 at 12:21

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