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Hong Kong Explains COVID-19 Reliefs For Tax Debtors

Friday, August 6, 2021

Hong Kong's Inland Revenue Department has explained COVID-19 tax concessions available for taxpayers struggling to pay their tax dues and has highlighted upcoming property tax obligations.

On support measures for tax debtors, the IRD said on June 18: "Taxpayers who encounter financial difficulties in settling their tax bills on time may apply for payment of tax by instalments before the due dates of the demand notes. For taxpayers who have obtained the IRD's approval for instalment settlement of the demand notes for Salaries Tax, Profits Tax and Personal Assessment for the year of assessment 2020/21 issued between May 2021 and May 2022, no surcharge will be imposed for a maximum period of one year counted from the respective due dates of the demand notes, provided that the instalment plans are duly adhered to."

Further, the IRD said it has extended a previous concession waiving the surcharge for instalment settlement of demand notes for the years of assessment 2018/19 and 2019/20, for demand notes issued between December 2019 to May 2022 for the 2018/19 year of assessment, and for demand notes issued from August 2020 to May 2022 for the 2019/20 year of assessment.

Separately, the tax agency released on June 17 a notice outlining the obligations on property owners in relation to property tax. The agency noted that property owners that receive rental income are required to inform the Department in writing that they are liable to tax and supply the particulars oft he property not later than July 31, 2021, unless they have already received a tax return. Taxpayers should notify the agency using "Notification of Letting of Properties" (IR6129).

The following tax return that should then be filed, within one month of it being issued, depending on the status of the taxpayer:

  • Form BIR60 for property owned by an individual;
  • Form BIR57 for property owned jointly or co-owned by individuals; or
  • Form BIR58 for property owned by corporations and bodies of persons.