In Hong Kong, the term personal (income tax) is replaced by the salary tax. Why people are really interested in the taxation structure of Hong Kong is because they are some of the lowest in the entire world. It becomes a matter of interest how income tax return hong kong is filed. Hong Kong as a progressive slab of tax rates for salary. These tax slabs are 2%, 7%, 12% and 17%.
After calculation an individual’s net chargeable income (i.e. assessable income after deductions and allowances), they are put into the four slabs mentioned above. If the 15% of net income (i.e. income after deductions) is lower, then that is the income (salary) tax they are charged. The concept of capital gains tax, dividend tax, and inheritance tax does not exist in Hong Kong.
In Hong Kong, people are taxed only on the income that has been derived in Hong Kong.
If you are a citizen of Hong Kong and you wish to reduce your tax burden, you can do so by choosing personal assessment. In this method, your aggregated income from all sources is put into progressive tax slabs. This can cut down on your taxes.
The period of tax calculation is from April 1st to March 31st of the next year.
The Tax Slabs
The distribution of a person’s net chargeable income into different tax slabs is as following:
- Net Chargeable Income (in HKD currency) Rate
- 0 – 40,000 HKD. 2%
- 40,001 – 80,000 HKD 7%
- 80,001 – 120,000 HKD. 12%
- Above 120,001 HKD. 17%
Submit annual return hong kong by referring to a good agency.