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Volume 16 Second Supplement

Publication Date: Apr 2002

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DIGEST OF CASES REPORTED

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  Decision No. Download
PENALTY TAX    

submission of incorrect tax returns and failure to file any tax return for several years of assessment without reasonable excuse - serious case of understatement - repeat offender - the weight to be attached to a relevant factor depends on the facts of each particular case - the degree of lateness was the primary consideration for a late but correct return - 100% is the appropriate percentage for cases where the taxpayer has filed no return for a number of years - no reason to restrict citation of authorities to cases reported in the past four years as long as it is relevant - maximum penalty was 300% of the amount of tax undercharged or which would have been undercharged - penalty imposed ranged from 106.7% to 150% of the tax undercharged - ss 51(4)(a), 68(4), 82A, 82B(2)(c) and 82B(3) of the Inland Revenue Ordinance ('IRO')  

D85/01 Download D85/01 (DOC) - English Download D85/01 (PDF) - English

submission of incorrect tax returns for four years of assessment without reasonable excuse - standard practice to use as a starting point penalty equivalent to 100% of the tax underpaid - s 82A of the Inland Revenue Ordinance ('IRO')  

D75/01 Download D75/01 (DOC) - English Download D75/01 (PDF) - English

whether a reasonable excuse for omission in returns - whether risk of offence being repeated factor for reduction - least serious category for additional tax  

D88/01 Download D88/01 (DOC) - English Download D88/01 (PDF) - English
PROFITS TAX    

accounting adjustment - whether error - managing fee - whether having commercial basis - s 70A of the Inland Revenue Ordinance ('IRO')  

D62/01 Download D62/01 (DOC) - English Download D62/01 (PDF) - English

intention at the time of purchase - whether or not subsequent purchase relevant to determining the intention - s 68(4) of the Inland Revenue Ordinance ('IRO') - onus of proof on the taxpayers  

D77/01 Download D77/01 (DOC) - English Download D77/01 (PDF) - English

property - whether for the purpose of trade  

D64/01 Download D64/01 (DOC) - English Download D64/01 (PDF) - English

property - whether investment or trade  

D63/01 Download D63/01 (DOC) - English Download D63/01 (PDF) - English

real property - whether the gains arising from the disposal of properties were liable for profits tax - ss 2, 14(1) and 68(4) of the Inland Revenue Ordinance ('IRO')  

D74/01 Download D74/01 (DOC) - English Download D74/01 (PDF) - English

sale of property - whether profits derived from the sale of the property assessable to profits tax - intention at the time of acquisition - whether previous sales transactions indicative of trading intention - whether financial ability as sole factor to test the trading intention. [Decision in Chinese]  

D76/01 Download D76/01 (DOC) - Traditional Chinese Download D76/01 (PDF) - Traditional Chinese

whether decoration expenses deductible. [Decision in Chinese]  

D71/01 Download D71/01 (DOC) - Traditional Chinese Download D71/01 (PDF) - Traditional Chinese

whether the sale of a property was trading in nature - absence of taxpayers in the hearing - three options available to the Board under such circumstances - ss 68(2B) and 68(2D) of the Inland Revenue Ordinance ('IRO')  

D83/01 Download D83/01 (DOC) - English Download D83/01 (PDF) - English
SALARIES TAX    

employment - source of income - whether liable to salaries tax - ss 8(1), 8(1A), 8(1B) and 68(4) of the Inland Revenue Ordinance ('IRO') - costs - frivolous and vexatious and abuse of the process - s 68(9) of the IRO  

D73/01 Download D73/01 (DOC) - English Download D73/01 (PDF) - English

failure to report additional earnings - whether or not employer's agreement to pay tax for the taxpayer relieved the taxpayer of his responsibility to pay tax on his earnings - s 68(4) of the Inland Revenue Ordinance ('IRO') - onus of proof  

D79/01 Download D79/01 (DOC) - English Download D79/01 (PDF) - English

income - lump sum received from employer on cessation of employment - ss 8(1), 9(1)(a), 11D and 68(4) of the Inland Revenue Ordinance ('IRO') - rental allowances - ss 8(1), 9(1)(b), 9(1)(c), 9(1A), 9(2), 61 and 68(4) of the IRO  

D70/01 Download D70/01 (DOC) - English Download D70/01 (PDF) - English

property agent - whether independent contractor carrying on his own business  

D61/01 Download D61/01 (DOC) - English Download D61/01 (PDF) - English

s 8(1) of the Inland Revenue Ordinance ('IRO') - two-contract arrangement - whether an employment income arose in or was derived from Hong Kong - s 61A of the IRO - whether the Board a proper forum to consider the refusal to accept late objection - s 9(1)(d) of the IRO - whether the exercise of share option is liable to tax  

D67/01 Download D67/01 (DOC) - English Download D67/01 (PDF) - English

single parent allowance - ss 2(3), 32(1), 32(2) and 68(4) of the Inland Revenue Ordinance ('IRO')  

D42/01 Download D42/01 (DOC) - English Download D42/01 (PDF) - English

whether a sum was severance payment - a sum paid to the taxpayer on termination of his employment does not necessarily follow that the amount cannot be liable to salaries tax - test for salaries tax liability was whether the sum arose from the employment for services past, present or future - whether ex gratia payment or 'gratuity' - whether arose from the employment - whether being made for past services - an extra emolument paid upon the conclusion of a contract of employment - ss 8(1) and 9(1) of the Inland Revenue Ordinance ('IRO')  

D87/01 Download D87/01 (DOC) - English Download D87/01 (PDF) - English

whether 'prevented' from giving the requisite notice of appeal - what are the conclusive factors in determining the location of an employment - the 60-day rule - ss 8(1)(a), 8(1A)(b)(ii), 8(1A)(c), 8(1B), 66(1A) and 68(4) of the Inland Revenue Ordinance ('IRO')  

D82/01 Download D82/01 (DOC) - English Download D82/01 (PDF) - English

whether the long service payment forms part of the gratuity payment - ss 31V and 31Y of the Employment Ordinance ('EO') - whether long service payment should be exempted from salaries tax under the EO  

D81/01 Download D81/01 (DOC) - English Download D81/01 (PDF) - English

 

Note: The latest position of unsettled appeals is shown in either (a) Table of Appeals to Court of First Instance or (b) Table of Appeals to Court of Appeal/Court of Final Appeal. When the final outcome of an appeal is known, the position is set out in either table and will disappear in the next issue of Board of Review Decisions.

To view "Table of Appeals to Court of First Instance/Court of Appeal/Court of Final Appeal" (position as at 28.2.2002), please click here.

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