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Salary Tax and Sole Proprietor

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  1. #11

    Join Date
    Jan 2014
    Posts
    1,391
    Quote Originally Posted by muzzdang:
    (1) HK salaryman set it up in HK (but server not in HK)
    (2) He performs some mod functions, like shri, in HK; but there are other mods
    (3) He along with other admins (not in HK) conducts the annual (or semi-annual) donation drive in HK, but entirely online.

    Looks like (1) and (2) is the activities performed in Hong Kong to generate some income, so these are likely Hong Kong sourced and taxable

    (3) potentially argue that some of the activities to generate income were performed outside of Hong Kong, so maybe a portion non-Hong Kong sourced - not sure you want to fight the IRD on this amount if not material

    However, if we take a step back, are you really running a business or just pursuing a hobby as you say? There are many case laws on this, you can refer to the document below where the courts rejected a claim that share trading was a business - though it references many case laws that deals with trade vs hobby

    https://www.info.gov.hk/bor/en/appea...s/v22_2nd5.pdf

    Thanks, very useful case!

    The taxpayer in that case did not take out a business registration.

    In our case, he will. This "hobby" will most certainly earn less than $7100 per month, so no need to do MPF.
    Last edited by nivek2046; 20-05-2024 at 03:51 PM.

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