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IRD grants one-month extension to all eTAX filers


The Inland Revenue Department (IRD) will grant an automatic extension of one month to all e-filers in an effort to encourage online filing of tax returns.

Announcing this today (May 5), the Commissioner of Inland Revenue, Mrs Alice Lau, said that more than 1.97 million individual tax returns had been issued last Friday (May 2). She reminded taxpayers to file their tax returns on time.

"As a one-month period is allowed for filing individual tax returns, the deadline falls on June 2 this year," Mrs Lau said, adding that eTAX users filing their tax returns online could have the deadline extended to July 2.

"For sole proprietor of un-incorporated businesses, a three-month period is allowed and the filing deadline is August 2," she said.

In this year's Budget, the Financial Secretary proposed a tax reduction of 75% for 2007-08, subject to a ceiling of $25,000 per case.

Mrs Lau said that salary earners should complete this year's tax return as usual. No application was needed for the tax reduction.

"Individuals with rental and/or business income will enjoy such reduction whether they elect personal assessment or not. However, the amount of reduction they will get might be different when assessed under each type of tax or personal assessment. The exact position will need to be evaluated case by case.

"Individuals having business and rental income and eligible for personal assessment may make such election in their tax returns. IRD will check, in each case, whether the personal assessment election will reduce the amount of tax payable, and assess each taxpayer in the way to his advantage," she said.

Other tax relief measures for 2008-09 proposed in the Budget included raising the personal allowances, widening the tax bands, lowering the standard rate and corporate profits tax rate, raising the deduction ceiling for charitable donations and accelerating tax deductions for capital expenditure on environment-friendly facilities.

The Government has initiated the law amendment process. After enactment of the relevant legislation, IRD will effect the 2007-08 tax reduction in this year's tax bills, and will automatically apply the new allowances, tax rates and bands in calculating the 2008-09 provisional tax.

To encourage more generous charitable donations to support disadvantaged groups, it was proposed in the Budget that the deduction ceiling for approved charitable donations will be raised to 35% of the taxpayer's income. That is, if a taxpayer makes a generous donation of one third of his income, the amount will still be fully deductible for tax purposes.

"To guard against abuse, IRD will step up audits on donation claims," Mrs Lau said.

She stressed that only donations made to tax-exempt charities were tax deductible. A list of these tax-exempt charities can be found on the IRD website. Donation receipts should be kept for seven years and submitted for IRD's examination when called for.

If taxpayers have a problem when completing their tax returns, they may visit the IRD website for the e-Seminars. They may also seek help in the Q&A corner or call the enquiry hotline 187 8022. The service hours of the operators of this hotline will be extended, from May 2 to June 2, from 8.15am to 7pm on weekdays, and from 9am to 1pm on Saturdays. There is no operator service on public holidays.

Mrs Lau said that this year, Internet filing had been enhanced by a new function enabling the users to have their e-return data saved in their personal computers. The system has also been updated with the tax concessions proposed in the 2008-09 Budget. When filing their returns online, taxpayers will instantly know the amount of tax payable in the coming bill after the tax concessions.

Describing eTAX as one's tax secretary, Mrs Lau said it was a convenient, safe and environment-friendly service. "Hong Kong people lead hectic lives and some travel a lot. I would recommend eTAX, enabling them to attend to their tax business anywhere around the clock," she said.

On revenue collection, Mrs Lau said that $200.6 billion had been collected during 2007-08, an increase of some $45.5 billion over last financial year. Following are the detailed figures:

2007-08 revenue collection (provisional figures)

Tax Type 2006-07 2007-08 Difference
  ($million) ($million)  
  ──── ──── ────
Profits Tax 71,919 91,423 +27%
Salaries Tax 38,586 37,479 -3%
Property Tax &
Personal Assessment



  ──── ────  
Total Earnings
& Profits Tax
115,318 133,730 +16%
Estate Duty 778 353 -55%
Betting Duty 12,047 13,048 +8%
Stamp duty 25,076 51,551 +106%
Others 1,882 2,016 +7%
  ──── ────  
Total Revenue
155,101 200,698 +29%

Ends/Monday, May 5, 2008
Issued at HKT 15:01