Posted by
Mac-010
18 yrs ago
Hi !,
Started with a new company and they dont mind to declare part of package as Housing Allowance if it helps with tax. The CPA they use though says there is no advantage; this cant be right no ?. (or did something change this year ?).
Also; does anyone know if the company give a Transportation Allowance (usually 2 or 3k HKD a month); is that OK and legal etc ?. I've had it many years ago and it was not taxable. No accountant so not sure how it works though.
Company dont mind if its legal.
Thx for help; more in pocket is better ;)
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Not sure but here is my input :- (1) housing allowance : as far as I know it is calculated on a different scale. It is taxbale but the scale is not the same as your salaries tax. Dont know why yr CPA said no difference. It made a difference for us 3 years ago but may be now rules has changed. (2) Transportation allowance : one of our directors receives HK$3,000 per month in cash claiming as transportation allowance for about 10 years n so far no challenge. It of course depends on how much you earn and the transportation allowance shld be a balanced figure. Strictly speaking it is illegal, I would say, but Tax Dept somehow gives a blind eye to it.
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ltxhk
18 yrs ago
IRD is asking to see more employment contracts to verify housing. Housing allowance is no longer the correct term; should be defined as "rental refund". Transportation is only "allowable" if it is exclusively incurred in the the production of income. IE going to appointments, research, site vists; transport to and from home is taxable.
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Thx for feedback; love this site !.
I've asked our CPA in writing as well; think it was a juinor (Lazy) that gave us info.
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