Its time for Tax Assessment

[skyislimit]

Yes correct. Seems cannot be amended.

I am thinking of filling the form without rental reimbursement and explain IRD why I made that choice on a separate email. not sure what else I can do.

[freeier]

Can someone please advise me on this?

I had elected for rental reimbursement. However while filing returns realised that I will be paying higher tax if I fill in as rental reimbursement instead of using the new rent deduction.

Is this a decision i can make at the time of filling form to participate in rental deduction instead of rental reimbursement.

Since due date is passed company cannot change my reimbursement details on the employer statement to IRD.

Any advice would be helpful. Thanks

I got screwed by that once. I filled in according to the company table where my rental is actually less than 10% of gross.. and IRS dully charged me more.. Anyway to cut it short went thru a whole few correspondence with IRS and had physical letters in and out, before they finally agreed that I should not pay so much and allocated the items retrospectively.

I have never tried, but technically if you can work out the numbers yourself you might want to key in the correct numbers and drop the rental reimbursement allocation entirely. They will query you then you can tell them your basis for putting it this way. If you enter according to company's numbers you will eventually want to challenge their assessment as well.

[skyislimit]

Thanks, that's very useful to know. Glad you could sort that out. But sounds like a lot of back and forth.

[Peaky]

With the talent attraction scheme going on, why not revisit and sweeten the deductions for expats. Ultimately, expats only have MPF and Rental deductions.

and yes, GENERALLY speaking, HK has one of the lowest taxations already. But with the number of exodus and limited number of talents coming to HK, why not just sweeten the deal further. Tax deductibles are beneficial to the overall economy too. It means the individual is spending back into the economy. Off the top of my head, why not allow full Rental deduction instead of capping it at 100k? This can help boost the incentive for those who wish to rent more expensive flats.

So, you're suggesting that it would be smart to push HK into a singapore style expat area rental demand/price hike frenzy to help out all the poor disadvantaged landlords owning properties in prime locations? That's going to be zero sum (at best) for your takehome pay very very quickly.

More broadly, nearly 100% of any income tax reduction for expats would surely be saved rather than spent, so I don't see any wider benefit to the HK economy either. I'm sure it would help attract some additional talent at the margin, incl. those possibly considering SG or Middle East, but

i) it would end up being targeted at whatever outdated fad “industry” HK has decided to become a hub in each year, and therefore right now only apply to random headset wearing people with Web3 credentials, and

ii) helping out foreigners while subjecting mainland expats to 35% tax is rather off-message politically...

[D.YU]

ii) helping out foreigners while subjecting mainland expats to 35% tax is rather off-message politically...

Why would mainland expats be treated differently compared to other expats? That is not what I was suggesting. With tax incentives, it only works if the tax payer spends money, which in turn will benefit the overall economy. My example was just one suggestion, there could be hundreds of different deductions that is beneficial to expats and the general economy.

If HK wants to attract more talents, whether mainland or others, they need to sweeten the deal. Of course, it needs to be handled carefully.

[Peaky]

China is essentially applying US style extra territorial taxation on global income for mainlanders, so it isn't in HK's hands. HK could waive all their taxes here but all that would happen is that they'd take a lower double tax relief deduction and pay the benefit over to the mainland authorities.

[D.YU]

China is essentially applying US style extra territorial taxation on global income for mainlanders, so it isn't in HK's hands. HK could waive all their taxes here but all that would happen is that they'd take a lower double tax relief deduction and pay the benefit over to the mainland authorities.

Ah I see.. but like you said, if its global taxation then its not something HK can control.

However, there are always ways to "sweeten" the deal. Just a matter of how desperately we need expats.

On a separate note- I dont see many companies proactively hiring expats (especially non-Chinese). Its actually harder to get a job a non-canto/non-mando person. Even technical roles in my company is seeking canto/mando fluent staff.

As a P&L owner, I too cannot justify hiring an expat that cost 50-150% more than a local/mainlander. Unless there are some subsidies from the gov, it is difficult keep the bottom line sound. But then if the gov starts subsidizing large corps, I can imagine the "fairness" gets more outta control.

[RobRoy]

As a P&L owner, I too cannot justify hiring an expat that cost 50-150% more than a local/mainlander. Unless there are some subsidies from the gov, it is difficult keep the bottom line sound. But then if the gov starts subsidizing large corps, I can imagine the "fairness" gets more outta control.

On the other hand, if the company is western, if you bring over a competent expat with connections to head office, the 50-150% extra in key positions can often really be worth its salt. Just breaking up the local working style and thinking with someone with a very different mindset is worth a lot as well. Of course if you can get the same thing for a basically local salary that is great, but often not possible.

[GentleGeorge]

When I came over I looked much more closely at the headline rates than all the various allowances

If they want to attract expats, better to kill off some of the allowances/rebates/refunds and just chip away at the top rates.

Probably less hassle for all involved as well.

[D.YU]

On the other hand, if the company is western, if you bring over a competent expat with connections to head office, the 50-150% extra in key positions can often really be worth its salt. Just breaking up the local working style and thinking with someone with a very different mindset is worth a lot as well. Of course if you can get the same thing for a basically local salary that is great, but often not possible.

I agree. That is why I am here.

However, most working level needs to work with internal and/or external stakeholders (including business partners) which are mostly Chinese. As much as I want to add more western minds into the team, it doesnt really meet the day to day responsibilities. Unless we are talking about very senior staff which is scarce compared to the junior or mid management level roles.