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2022 tax filing tips: When should you file your taxes? Under what circumstances do I have to pay tax?

Tax filing season is here again, and every salary/wage earner may have to face the tax return sent by the Inland Revenue Department, commonly known as the “green bomb”. Before filing a tax return, many people want to know more about tax filing. Whether it is your first time filing a tax return or not, the following comprehensive frequently asked questions can help you who are troubled by your tax return. Please refer to this article for more tax filing information.

When is Salaries Tax due (2021/22)?

In each tax year, that is, from April 1st to March 31st of the next year, within the 12-month period, all actual income has the opportunity to be levied salaries tax. Assuming you start working on a certain day in the year of assessment, you should file a salaries tax return on your income between that day and 31 March next year.

Referring to the situation of the Inland Revenue Department in previous years, tax returns will be issued from the first working day of May and will be delivered to taxpayers one after another. From June to July, taxpayers need to return the completed tax returns to the taxpayer on time. Afterwards, the Inland Revenue Department will issue a tax payment notice in October; taxpayers are required to pay the first instalment of tax in January and the second instalment in April.

How to calculate salaries tax?

The calculation of salaries tax is very simple. In the year of assessment, the income is calculated in two ways, whichever is lower.

1) Net taxable income: total income – total deductions – total allowances

2) Net Income: Gross Income – Total Deduction

How much annual salary should I pay salaries tax?

As long as your annual salary/income in the year of assessment does not exceed the basic allowance of HK$132,000, you basically do not need to pay tax. However, if you still receive a tax return from the Inland Revenue Department, you still need to fill in the information truthfully and return it on time to notify your income.

What if you are a first-time taxpayer?

If you enter the workforce for the first time and become an employee of a company, the Inland Revenue Department will set up a file for you in advance, so that you can handle the tax return. Therefore, the tax return for the first tax return is generally not sent out on a fixed date. The employer should also submit the form IR56E to the Inland Revenue Department within 3 months of the new employee’s entry into the office, as well as the notice of paying salaries tax, and send the tax return to you within 5 months for the first tax return.

Do you have to file a tax return if you are part-time, have no income, and do not receive a tax return?

Even if you are not a full-time employee, whether you are part-time, freelance, or self-employed who run a trade, buy or sell goods, or provide professional or personal services to earn income, you need to file a tax return.

In the year of assessment, taxable income actually includes salaries, allowances and bonuses, etc. If the annual income is less than HK$132,000 of the basic tax-free allowance, or the expected income does not exceed the tax-free allowance, as long as you receive a tax return, you need to declare it.

If you do not receive tax returns, and you often need to file tax returns in previous years, you are actually responsible for contacting the Inland Revenue Department within 4 months after the end of the tax year. You can also obtain a duplicate tax return and use the online eTAX service to inquire and review all tax and tax return matters.

The above information is for reference only. If you have any questions about tax declaration and accounting, we welcome your inquiries.

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