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HKD240k per year as a junior buyer ?

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  1. #21

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    The calculator on the government site is, of course, correct.

    But the lowtax.net site is also correct (though it is for the 2009/10 tax year) - you simply haven't understood it. What it is saying is that your marginal tax rate on earnings over (allowances + $120,000) would be 17%, not that you would be taxed at 17% on your entire income. (Again, those were the figures for the 2009/10 tax year).


  2. #22

    Join Date
    Nov 2011
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    Quote Originally Posted by raph873:
    Hi every one

    I'm coming back on my post.

    I've discussed again with the boss about the salary. I'm going to earn more, but he said that I am also going to pay the max rate for taxes.

    So I've checked again, because it wasn't the result of the tax calculator!

    As for now, I should be paid something like HKD337500 yearly.
    According to the calculator, I should pay HKD 24,975 that is to say 7.4%
    But according to charts on the Internet, over HKD120,000 we should pay 17% (example this site: http://www.lowtax.net/lowtax/html/hongkong/jhkpetx.html )

    So I don't understand what I am going to pay, and that's the double... So it's hard to establish a budget for my living.

    Thanks for your help



    For a salary of 300k-400k you should expect to pay an effective tax rate of around 7-8%. At that level your tax bill will be calculated using the progressive system but overall it work out at about 7-8% of your salary.

    If you will be renting a place by yourself. Even a cheap place (7000HKD monthly) on your salary (28000HKD monthly) will be 25% of your income. As such you should look into whether your employer can/will structure your pay as a salary and a housing allowance. For example using the figures above a 21k salary and a 7k housing allowance. Then you would not be liable for tax on your housing allowance but the tax department would gross up your salary by 10% giving you a taxable income of 21 x 1.1 = 23.1 k instead of 28k.
    Gruntfuttock likes this.

  3. #23

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    Good point, although the employer also needs to "exercise control" that the $7k (at least) is actually spent on housing and report accordingly to IRD on their annual return.


  4. #24

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    Quote Originally Posted by Gruntfuttock:
    Good point, although the employer also needs to "exercise control" that the $7k (at least) is actually spent on housing and report accordingly to IRD on their annual return.
    Which is easy enough, just give copy of lease to employer & give a monthly rental receipt

  5. #25

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    Yes indeed, if the employer cooperates.


  6. #26

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    Oct 2013
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    Quote Originally Posted by arrowsmith:
    by 10% giving you a taxable income of 21 x 1.1 = 23.1 k instead of 28k.

    Okay so that means that I'll have a tax of 7% on my taxable income (HKD23.1k), right ?

    Do you know guys how much will be my employer taxed on the 7k for housing ?
    What is by the way the social tax he's going to pay for a "normal" income of 28k ?

    Thanks all of you

  7. #27

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    Your employer will not be taxed on the $7K for housing any different from if it were salary.

    Using the calculator here: http://www.ird.gov.hk/eng/ese/st_com..._14/stcfrm.htm your salary tax for the year would be $14,724, which is about 4.4% on $28K per month if the housing allowance were set up as described.

    If by "social tax" you mean MPF then it's 5% from you and 5% from your employer, with a cap of $1250/month each.


  8. #28

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    Oct 2013
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    Quote Originally Posted by Gruntfuttock:

    Using the calculator here: http://www.ird.gov.hk/eng/ese/st_com..._14/stcfrm.htm your salary tax for the year would be $14,724, which is about 4.4% on $28K per month if the housing allowance were set up as described.
    How did you get that?
    For taxable income, I've written : 23.1k x 12months = 277.2k yearly
    For "Income for the year of assessment": 7k x 12 = 84k yearly
    But the calculator crashes and says "You input HK$84,000. The value of all places of residence provided cannot exceed 10% of your income"

    Thanks for the rest, I don't understand every thing but I'll deal with that lately

  9. #29

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    If you have salary of 21k plus housing allowance then you put $252,000 in the salary box and $25,200 in the "value of residence provided" box. It doesn't actally matter how much the housing allowance is provided that your employer checks that you spend at least that much on rent.


  10. #30

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    the point is..on a 21 or 28k salary...u will pay very very little tax.

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