Posted by
skywalkers
17 yrs ago
I would like to find out from anyone who has experience from this matter. I'd worked here in Hong Kong in 1995 for a American company and was under their payroll. The time frame was for about 6 months, I did not pay any local HK taxes. Now I am back in Hong Kong working again, they have been trying to get me to pay back taxes from 1995. Is there a statute of limitation on this matter, or is this even legal?
Thanks for any help.
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lmcf
17 yrs ago
IF the Tax assessment was issued in 2002 or earlier for 1995, then you are liable. IRD must issue all tax assessments within 7 years of the tax year; afterwards it is past the limitation.
If IRD is chasing you, it is almost 100% likely that the 1995 assessment was issued. Your former employer reported your earnings, and then the assessment was generated by IRD as standard procedure. It was never paid and they had no means to contract you. Now that you have resurfaced, IRD will chase the due taxes. You may object to the tax amount if you have due reason. Otherwise you need to pay, since they will take you to district court for recovery ..... and they will win.
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Thanks lmcf.
They had ask me for my W2's from the US during that period which I produce to them. They then proceeded to send me a letter telling me that "Suitable arrangements had been made", because they were trying to hold my wages about 1 year ago. So, they cleared it and now they are contacting me and telling me that it was a mistake and the person that was taking care of my case is no longer with IRD. I think that they are unaware of that I have that letter from IRD. Does this letter have any weight? I am going to talk to them in person.
Thanks.
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you say "about 6 months" i think you are liable if you work in HKG for more than 6 months but not LESS than 6 months, best to check. of course it also depends on what kind of visa you were on at the time. as you said, best to arm yourself with any paperwork you have and count the number or days you spent in HKG just to help out!
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lmcf
17 yrs ago
If you were seconded to HK for under 6 months and still paid USA taxes, then you may be exempt. There could be some confusion from IRD on this point. On the other hand, if this is the case, it is really odd that a US company reported HK income to IRD.
"Suitable arrangements have been made" does not mean that you owe nothing in IRD language. It only tells your current employer or yourself that no deduction and action will be taken at this moment. If an assessment has been cancelled, you will receive a notice that specifically states cancellation.
You need to speak to IRD in person and find out if there is a tax assessment. If there is a tax assessment, then you can request waiver due to the secondment. The rules of 1995 will apply rather than today.
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