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How to apply for installment payments? What information and documents are required for application?

If the taxpayer encounters financial difficulties and you are unable to settle the tax payment on time, you can apply for tax payment in instalments to tide over the tax difficulties. The following will introduce the application qualifications, application period, application method, etc. of the instalment tax payment one by one, hoping to help you who are confused by tax issues.

Eligibility to apply for instalment payment?

According to the “Inland Revenue Ordinance”, as long as the taxpayer fails to pay the tax for the current year of assessment on time due to financial difficulties, reduced income, etc., he/she may consider applying for instalment payment.

What is the application period for instalment payment?

Since the Inland Revenue Department promises to reply to the applicant within 21 days after receiving the taxpayer’s tax instalment application, the applicant may consider submitting the tax instalment application at least 21 working days before the tax payment deadline.

Additional fee for instalment payment

Although applying for instalment payment can temporarily relieve tax and financial pressure, if a taxpayer applies to the Inland Revenue Department for instalment payment, and once there is an unpaid tax on the tax payment deadline, the arrangement may be cancelled.

Moreover, this part of the tax will be subject to a surcharge of not more than 5%; if there are still unpaid taxes and surcharges 6 months after the tax payment deadline, they will be levied on top of this No more than 10% surcharge.

Generally speaking, the government will implement relevant relief measures according to the overall economic situation of the year. For example, in 2021, the Hong Kong government will provide an additional tax on instalments for salaries tax, profits tax and personal assessment tax bills for that year. Fee waiver for one year.

How to apply for instalment payment

Taxpayers who want to apply for instalment payment can apply in writing from the following methods:

• Complete the application form (you can download the designated form from the IRD website):

• Individuals / Sole Proprietors (Form IR1360)

• Partnership (Form IR1360A)

• Corporation (Form IR1360B)

• Submit the form in person to 7/F, 6/F (Individuals), Revenue Tower (corporate, partnership and departure cases);

• By post to a dedicated mailbox (P.O. Box 28497, Gloucester Road Post Office, Hong Kong);

• Submit your application by fax to 2519 6757;

If you have any questions about tax instalment cases, you can call the Inland Revenue Department’s enquiry hotline: 187 8033.

Supporting information and documents required for instalment payment

Regardless of the above application method, taxpayers who wish to apply for instalment payment should remember to provide a “daytime contact telephone number” when submitting the form so that the authorities can follow up, and submit the following supporting information and documents to the taxpayer Bureau:

Individuals/Sole Proprietors:

• Completed “IR1360” form:

• Specific tax instalment advice:

• It is recommended to apply for tax payment in 6 instalments or above, with a minimum monthly payment of HK$10,000;

• Explain the reasons for financial hardship.

• Copy of bank statement/passbook for the last 3 months;

• Details of income and expenses for the last 3 months;

• Debt repayment information.

Partnership business:

• Completed “IR1360A” form:

• Specific tax instalment advice, explaining the reasons for financial difficulties.

• Copy of bank statement/passbook for the last 3 months;

• Details of income and expenses for the last 3 months;

• Debt repayment information;

• Management accounts (including income statement and balance sheet) for the last 3 months.

Corporation:

• Completed “IR1360B” form:

• Specific tax instalment advice, explaining the reasons for financial difficulties.

• Copy of bank statement/passbook for the last 3 months;

• Debt repayment information;

• Management accounts (including profit and loss statement and balance sheet) for the last 3 months;

• Cash flow position and forecast table.

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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