Relief Measure: Conditional waiver of surcharges for instalment settlement of demand notes for the Year of Assessment 2019/20

Who can apply

Taxpayers who encounter financial difficulties in settling their tax bills on time may apply to the Inland Revenue Department (IRD) for payment of tax by instalments before the due date of the tax demand notes.

The Inland Revenue Ordinance provides that a surcharge of not exceeding 5% on the amount of tax outstanding after the due date may be imposed and a further surcharge of not exceeding 10% may also be imposed on the amount remaining unpaid (including tax and 5% surcharge already imposed) after 6 months from the due date.

In light of the economic downturn and the financial difficulties that some taxpayers (including individuals and companies) might be facing, the Government announced on 12 August 2020 a relief measure on tax payment. For instalment plans approved by the IRD allowing taxpayers in financial difficulties for settlement of Salaries Tax, Profits Tax and Personal Assessment demand notes issued between August 2020 and August 2021 for the Year of Assessment 2019/20, provided that the instalment plans are duly adhered to, no surcharge will be imposed for a maximum period of one year counting from the respective due dates of the demand notes. On 18 June 2021 and 22 June 2022, the above relief measure was further extended to cover relevant demand notes issued respectively between September 2021 and May 2022 and between June 2022 and May 2023.

If the tax demanded under the first instalment of the demand note has been settled on or before the due date and instalment plan is only granted for settlement of the tax demanded under the second instalment, the one-year period will count from the due date for the second instalment.

If payments are not made according to the approved instalment plan, the instalment arrangement will be cancelled and a surcharge of not exceeding 5% on the amount then outstanding will be imposed. A further surcharge of not exceeding 10% may also be imposed on the amount of tax and 5% surcharge remaining unpaid 6 months after the date of imposition of the 5% surcharge.

The above relief measure is not applicable to taxpayers who have to settle their tax liabilities before departing Hong Kong, taxpayers paying Property Tax and demand notes issued after May 2023.

How to apply

Application can be made:

• by completing the application form

  For Individuals/ Sole Proprietorships
  Download Form IR1360 (Y/A 2019/20)

  For Partnerships
  Download Form IR1360A (Y/A 2019/20)

  For Corporations
  Download Form IR1360B (Y/A 2019/20)

• in person at the Collection Enforcement Section at:

  4/F, Inland Revenue Centre, 5 Concorde Road, Kai Tak, Kowloon, Hong Kong

  Address and Office hours

• in writing

Applicants have to produce the following information and documents in support of their applications:

To avoid delay in obtaining further information for processing the application, applicants should provide their daytime contact telephone numbers in their applications.

Frequently asked questions on Relief measure on conditional waiver of surcharges for instalment settlement of demand notes for the Year of Assessment 2019/20 
 

Facilities provided by the IRD

To facilitate taxpayers to make instalment applications, the IRD provides:

• Enquiry Hotline 187 8033;
• Designated Fax Lines for applications by fax 2519 6757 (Individuals / Sole Proprietorships) and 2845 8850 (Partnerships / Corporations);
• Designated Post Box for applications by post (P.O. Box 28497, Concorde Road Post Office, Kowloon, Hong Kong)

The IRD pledges to reply to the applicants within 21 working days after receipt of the applications.