Taxpayer who is about to leave Hong Kong

What supporting documents are required to substantiate the claims made in the tax return for speedy tax clearance?

The following are documents required to support some common claims:-

Exemption of Income:
(Item 2 of Part 4.1 of BIR60)

Please read "Application for Full or Partial Exemption of Income or Claim for Tax Credit under Salaries Tax".

Deduction Claim:
(Part 4.3, 8, 9, 10 & 11.4 of BIR60)

Outgoings & Expenses	invoices/receipts, employment contract, etc.
Self-education Expenses	receipts, course outline, details of the recognized/accredited courses, etc.
Approved Charitable Donations	receipts
Interest payments for producing rental income	annual interest statement issued by the bank, loan agreement/approval letter, etc.
Home Loan Interest	annual interest statement issued by the bank, loan agreement/approval letter, etc.
Domestic Rents	rent receipts, copies of tenancy agreements, etc.
Qualifying premiums paid under the Voluntary Health Insurance Scheme Policy	invoices/receipts, copies of the insurance policies,etc.
Qualifying Annuity Premiums and Tax Deductible MPF Voluntary Contributions	invoices/receipts, copies of policies,etc.
Elderly Residential Care Expenses	invoices/receipts and a copy of the dependent parent´s Hong Kong Identity Card

Allowance Not Claimed Before:
(Part 11 of BIR60)

Married Person´s Allowance	a copy of each of the Marriage Certificate and spouse´s Hong Kong Identity Card
Child Allowance	a copy of the child´s Birth Certificate, etc.
Dependent Parent Allowance	a copy of the dependent parent´s Hong Kong Identity Card

Having furnished the tax return required, what is the earliest time I can expect to collect my tax demand note for tax clearance purpose?

If a properly completed tax return with supporting documents is furnished in person directly to the assessing officer handling your case and early tax clearance has been requested, the earliest date on which you can collect the tax demand note is, in general, the date following the date of furnishing the tax return. However, special treatment will be given in urgent circumstances.

Under what circumstances will the Inland Revenue Department raise estimated assessment for leaving Hong Kong cases?

If the tax return is not received by the Inland Revenue Department within the specified period or if it is impracticable for the Inland Revenue Department to issue tax return to the taxpayer having regard to the impending expiry of the statutory money withholding period obliged on his employer or the close departure date, estimated assessment will be raised based on available information. The estimated assessment may be excessive and you may have to lodge objections. To avoid going through the above process, it is advisable for taxpayers to arrange tax clearance with the Inland Revenue Department at their earliest convenience.

If my salaries tax is borne by my employer, do I need to clear my tax before departure?

While every taxpayer leaving Hong Kong is required to clear his tax liabilities before his departure, this is of no exception to those taxpayers whose employers undertake to bear their Hong Kong tax. Hence, employers, tax representatives and taxpayers should furnish tax returns and the supporting evidence as timely as possible so as to avoid the issue of estimated assessments.

I am a government servant. I do not have the Form IR56G. What documents should I bring to the Inland Revenue Department to arrange tax clearance? What will be issued upon my tax clearance?

If you are leaving Hong Kong, your department/bureau would upon your notice of departure prepare a Form IR56J for reporting your income from 1 April to your last day of employment. You could come to our office to arrange tax clearance with a copy of Form IR56J and monthly income statements for the latest year. Upon tax clearance, a Release Memo will be issued to the Treasury.

I am a government pensioner and shall emigrate to Canada 2 months later. My only income is a pension from the Government of the Hong Kong Special Administrative Region. Do I need to clear my tax before departure?

You need not finalize your tax liabilities before leaving Hong Kong. Instead, you should inform the Inland Revenue Department of your overseas postal address so that future correspondence including demand notes and tax returns can be sent to you at the correct address.

I have cleared my tax before departing Hong Kong. However, my employer now tells me that a bonus will be paid to me. What should I do? Is my employer required to file another IR56G and withhold payment of the bonus?

If you are entitled to additional emoluments giving rise to further salaries tax liabilities after tax clearance, you and your employer have to go through the tax clearance process again. Therefore, your employer is required to file an additional/revised Form IR56G to report the bonus and not to make any payment of money or money's worth for a period of one month from the date of giving notice. A fresh Letter of Release will be issued to you after you have paid the additional tax. For the purpose of sending to you the additional salaries tax demand note, you are reminded to notify the Inland Revenue Department of your latest correspondence address.

I have already emigrated to USA. My ex-employer in Hong Kong has previously granted me with some share options, of which I have not exercised before my departure from Hong Kong. Do I have to pay Hong Kong Salaries Tax on the share option gain if I exercise the options in the future?

If share option has been granted to you by virtue of your employment or office in Hong Kong, a gain realized from its subsequent exercise, assignment or release after your permanent departure from Hong Kong is nonetheless chargeable to Salaries Tax. Both you and your employer have to report the share option gain even after your departure.

With a view to finalizing your salaries tax liabilities prior to your departure, you may elect to have the liability ascertained on the basis of a notional exercise of the option. The Inland Revenue Department would calculate the gain as if it is realized had the share option been exercised on a day within 7 days before the date of submitting your tax return for the year of assessment in which you permanently depart from Hong Kong.

If you have not made such election before your departure, the Inland Revenue Department is prepared to accept an election made within 3 months from the date of permanent departure from Hong Kong. In this case, the date of departure will be taken as the date of the notional exercise for purposes of calculating the gain.

In the event that you have a non-Hong Kong employment and the option in question is a conditional one in respect of which the vesting period has not expired on the date of notional exercise, the gain would be calculated on the basis that the vesting period would be deemed to end on that date.

Should you wish to make such an election, please attach a statement to the tax return to the effect that the gain is offered for assessment on the understanding that no further liability will arise when the option is actually exercised, assigned or released after departure from Hong Kong. On the other hand, if the gain in respect of the actual exercise, assignment or release subsequently turns out to be less than the amount assessed in respect of the notional exercise, you may apply for appropriate re-assessment based on the actual gain.

For further details, please refer to the followings: