Salaries tax.pptx

Hong Kong Taxation -- Salaries tax W.L Ho Co. Scope Income arising in HK from office, employment, pension. Employment vs Office Non-HK employment vs HK employment DIPN 10 Office (director) An office is a position which exists by itself and is independent of the person who fills it. Source of income from an office: location of the office The office of director is located at the place where the central management and control of the company is located. HK employment Fully taxable Exemption: Rendered all services outside HK 60 days rule (visit HK = 60 days) Part of salaries taxed outside HK Non-HK employment Time basis 60 days rule 183 days rule (Mainland employment) Income Payments: wages, salaries, leave pay, commission, bonus, allowances. Convertible to money Payment for the liabilities of the employee Rental value = 10% *(gross income-gain on share option-allowable expenses)-rent suffered Share option Share award Allowable deductions All outgoings and expenses, other than expenses of a domestic or private nature and capital expenditure, wholly, exclusively and necessarily incurred in the production of the assessable income are deductible from the assessable income. Rare: travelling expenses, professional subscription fee Self-education expenses Concessionary deduction: home loan interest, donation, elderly residential care (subject to maximum limitation) Personal Allowance Basic allowance/Married person’s allowance Child allowance Dependent parent/grand parent/brother/sister allowance Single parent allowance Disabled dependant allowance Computation Salaries A Bonus and other taxable income B Less: Allowable expenses C D Add: Rental value (D*10%) Less: rent suffered E F Add: gain on share option G H Less: self-education expenses I Net assessable income before concessionary deduction J Less: concessionary deduction K L Less: personal allowances M Net chargeable income N