Hk Taxation
United International College
Hong Kong Taxation
Assignment 1
Answer the following questions. 25 marks each.
1. David’s salaries tax for year of assessment 2010/11 were due as follows:
1st instalment $10,500 due on 2 January 2012
2nd instalment $4,000 due on 4 April 2012.
However David failed to pay the 1st instalment by the end of January 2012. What actions will be taken by Inland Revenue Department to recover the tax from David?
Ans. When the tax was overdue after 2 January 2012, total tax $14,500 became due immediately. Inland Revenue Department would impose 5% surcharge on $14,500. The Department could take civil action to pursue the outstanding tax and surcharge in court. It could also issue a recovery notice to the employer of David or any third parties known to owe David money. If the tax was still outstanding for over 6 months, a further 10% surcharge could be levied. The Department could also consider to applying to court for departure prevention practice preventing David from leaving Hong Kong.
2. Joseph has a property at Flat G, 8th floor, Tower 3, Whampoa Garden. He rents it to James at $10,000 per month starting from 1 October 2010 for 2 years. In the tenancy agreement, Joseph will be responsible for the repairs of the premises and James will pay the rates $1,200 per quarter and management fees $800 per month. In April 2011, some minor repairs were done to the toilet. The repair expense of $1,000 was paid by James.
Calculate the property tax of Joseph for years of assessment 2010/11 and 2011/12.
Ans. Joseph’s Property Tax are
|Year of assessment |2010/11 |2011/12 |
|Letting period |1.10.2010 to 31.3.2011 |y.e. 31.3.2012 |
|Rental Income | |$60,000 | |$120,000 |
|Repair
Hong Kong Taxation
Assignment 1
Answer the following questions. 25 marks each.
1. David’s salaries tax for year of assessment 2010/11 were due as follows:
1st instalment $10,500 due on 2 January 2012
2nd instalment $4,000 due on 4 April 2012.
However David failed to pay the 1st instalment by the end of January 2012. What actions will be taken by Inland Revenue Department to recover the tax from David?
Ans. When the tax was overdue after 2 January 2012, total tax $14,500 became due immediately. Inland Revenue Department would impose 5% surcharge on $14,500. The Department could take civil action to pursue the outstanding tax and surcharge in court. It could also issue a recovery notice to the employer of David or any third parties known to owe David money. If the tax was still outstanding for over 6 months, a further 10% surcharge could be levied. The Department could also consider to applying to court for departure prevention practice preventing David from leaving Hong Kong.
2. Joseph has a property at Flat G, 8th floor, Tower 3, Whampoa Garden. He rents it to James at $10,000 per month starting from 1 October 2010 for 2 years. In the tenancy agreement, Joseph will be responsible for the repairs of the premises and James will pay the rates $1,200 per quarter and management fees $800 per month. In April 2011, some minor repairs were done to the toilet. The repair expense of $1,000 was paid by James.
Calculate the property tax of Joseph for years of assessment 2010/11 and 2011/12.
Ans. Joseph’s Property Tax are
|Year of assessment |2010/11 |2011/12 |
|Letting period |1.10.2010 to 31.3.2011 |y.e. 31.3.2012 |
|Rental Income | |$60,000 | |$120,000 |
|Repair