Home rent tax returns

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  1. #1

    Join Date
    Dec 2009
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    Home rent tax returns

    hey guys..

    Quick one..

    I am on a local contract with my company and am wondering how it works in terms of getting a tax return on the house rent that you pay monthly..

    I want to know what percentage of the rent paid will be returned to me. This would help me decide if it is worth me including it when I do my taxes (as I have heard that the paperwork for this can get quite tedious)....

    Thanks...


  2. #2

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    Question 18: Completion of Tax Return - Individuals

    You have to give your rental receipts to your employer.


  3. #3

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    Unless you are getting a housing allowance, which I assume you are not because being on local terms, then no part of your rental is tax deductible.


  4. #4

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    The paperwork is easy. All you need is to keep the receipt from your landlord to show how much rent you pay.

    It is definitely worth it. Basically whatever you pay in rent is taken off your income. So if you pay $10,000 per month, thats a $120,000 deduction for the year.

    There is one more thing. After taking away the $120,000, you have to calculate 10% of your income and add that back on. I never really understood the logic of this very well. But still it is definitely worth doing.


  5. #5

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    Quote Originally Posted by jaykay:
    Unless you are getting a housing allowance, which I assume you are not because being on local terms, then no part of your rental is tax deductible.
    I dont get a 'housing allowance'. But my company structures my salary in a way that minimises the tax payable and allows my rent to be tax deductible. Its perfectly legal and both locals and expats can do it.

  6. #6

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    Then they structure it as housing allowance!


  7. #7

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    Quote Originally Posted by jaykay:
    Then they structure it as housing allowance!
    OK, yes. For tax purposes they structure it as a housing allowance. But in effective terms, it is not really seen that way by both me and the company.

    Any reasonable company should do this for you whether you are expat or local. It costs the company nothing and saves the employee a lot.

    For example, lets say my salary is 50k per month. If I find an apartment that is 10k, then they simply state my salary as 40k and housing as 10k. If I want a 20k place, then they state it at 30k and 20k.

    Isnt this what everyone does? I just naturally assumed. If not, why on earth doesnt your company do it for you?

  8. #8

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    No, because there is a lot of paperwork involved for the company and this arrangement has to be audited as such.

    If this was so then of course employees at McDonalds would do it! You have an expat package as such, if you were on completely local terms then no you would not be able to do it.


  9. #9

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    OK fair enough. I am not aware of the paperwork on the company end. They have never complained about it and I have even moved to a more expensive apartment part way through the year and they automatically adjusted my salary down and housing allowance up.

    If you are not getting it, I would certainly ask your company if its possible.


  10. #10

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    Quote Originally Posted by bdw:
    For example, lets say my salary is 50k per month. If I find an apartment that is 10k, then they simply state my salary as 40k and housing as 10k. If I want a 20k place, then they state it at 30k and 20k.
    Using the above example, will MPF contributions be calculated based on the lower salary that's declared? Of course, this is assuming your company pays MPF based on a fixed % which is over and above the stated cap of HKD1K.

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