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Property owner fined for failure to notify chargeability

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A property owner was today (April 28) fined for failing to inform the Commissioner of Inland Revenue (CIR) in writing of his chargeability to Property Tax for the years of assessment 1997-98 to 1999-2000, contrary to Section 80(2)(e) of the Inland Revenue Ordinance.

The defendant pleaded guilty to three charges in the Kwun Tong Magistrates' Courts and was fined HK$10,000 on each charge and a further fine of HK$100,000, making a total fine of HK$130,000.

The defendant was one of the owners of the shop located at Kowloon (the Property). The defendant received rental income from letting of the Property during the years of assessment 1997-98 to 1999-2000. The rental income assessable to Property Tax was HK$3,153,000.

The defendant was chargeable to Property Tax for the years of assessment 1997-98 to 1999-2000 in respect of the rental income. However, he did not inform CIR in writing of his chargeability to tax until the Inland Revenue Department (IRD) issued an enquiry letter and subsequently the tax returns. The court was told that the defendant's failure to notify chargeability had resulted in tax undercharged of HK$401,232.

A spokesman for IRD reminded people that every person chargeable to tax for any year of assessment must inform CIR in writing that he is so chargeable not later than four months after the end of the basis period for that year of assessment unless he has already been required to furnish a tax return. A person who fails to notify chargeability without reasonable excuse shall be guilty of an offence and is liable to a maximum fine of $10,000 for each charge and a further fine of three times the amount of tax undercharged.

Ends/Thursday, April 28, 2005

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