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Volume 18 First Supplement

Publication Date: Jan 2004

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DIGEST OF CASES REPORTED

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  Decision No. Download
PENALTY TAX    

failure to report income - shares in exchange for option to acquire share - quantum - whether excessive  

D18/03 Download D18/03 (DOC) - English Download D18/03 (PDF) - English

failure to submit return as required - quantum - whether excessive  

D10/03 Download D10/03 (DOC) - English Download D10/03 (PDF) - English

incorrect return - a one-off understatement - a delay of about six years in collecting tax - no reasonable excuse - not remorseful but co-operative as investigation was concluded in about six months - liable to be assessed to additional tax - there must be an element of punishment for understating income - 72.8% was not excessive in the circumstances - assessment made on the basis of the compromise agreement reached between the Revenue and the appellant was final and conclusive - ss 68(4), 70, 82A(1)(a) and 82B(3) of the Inland Revenue Ordinance ('IRO')  

D31/03 Download D31/03 (DOC) - English Download D31/03 (PDF) - English

incorrect tax return - whether appellant can use mistaken reliance on tax representative as a reasonable excuse - whether or not due allowance has been given in assessing additional tax at 7.47%  

D15/03 Download D15/03 (DOC) - English Download D15/03 (PDF) - English

reasonable excuses for understating one's income - whether additional tax representing 14.46% of the amount of tax undercharged excessive - s 82A of the Inland Revenue Ordinance ('IRO')  

D6/03 Download D6/03 (DOC) - English Download D6/03 (PDF) - English

ss 51(2), 68(4) and 82A(1) of the Inland Revenue Ordinance ('IRO') - burden on taxpayer to make a return within the statutory period - whether mere oversight or carelessness can constitute 'reasonable excuse' from complying with s 51(2) of the IRO - whether or not the penalty is modest in view of the excessive delay and the amount involved  

D25/03 Download D25/03 (DOC) - English Download D25/03 (PDF) - English
PROFITS TAX    

income from employment or income from carrying on a business on own account - profits tax charging provision - salaries tax charging provision - onus of proof on appellant - fundamental test to be applied is the person who has engaged himself to perform these services performing them as a person in business on his own account - if 'yes', then the contract is a contract for services - if 'no', then the contract is a contract of service - relevant factors to be considered - no exhaustive list - ss 8(1), 8(1A), 14(1) and 68(4) of the Inland Revenue Ordinance ('IRO') - no appellant has the right to amend any statement of facts  

D16/03 Download D16/03 (DOC) - English Download D16/03 (PDF) - English

property - whether trading asset - instruction to sell shortly after purchase  

D20/03 Download D20/03 (DOC) - English Download D20/03 (PDF) - English

sale of property - intention at the time of acquisition - s 68(4) of the Inland Revenue Ordinance ('IRO')  

D14/03 Download D14/03 (DOC) - English Download D14/03 (PDF) - English

ss 14(1) and 68(4) of the Inland Revenue Ordinance - intention at the time of acquisition - onus of proof on the appellant to show that the intention of investing on capital asset was genuinely held, realistic and realizable. [Decision in Chinese]  

D23/03 Download D23/03 (DOC) - Traditional Chinese Download D23/03 (PDF) - Traditional Chinese

whether or not profits derived from trading were sourced outside Hong Kong - whether profits in question should be apportioned when the profits were derived partly from Hong Kong and partly outside Hong Kong - ss 66(3) and 68 of the Inland Revenue Ordinance ('IRO') - whether or not prejudice to respondent on the additional ground of appeal - burden of proof - frivolous and vexatious and an abuse of the process - order to pay costs  

D1/03 Download D1/03 (DOC) - English Download D1/03 (PDF) - English

whether the sale of a property was trading in nature - it was crucial to ascertain the intention of the appellant at the time of acquisition of the property - the stated intention of the appellant was not decisive - actual intention had to be determined objectively - direct evidence of those involved at the time of the acquisition would be highly relevant - burden of proof on the appellant - incumbent on the appellant to substantiate its contention - ss 29(6), 51(1), 51(2), 51C, 51D, 59(2), 59(3), 59(4), 60(1), 60(2), 63K, 68(4), 70A, 79 and 80 of the Inland Revenue Ordinance ('IRO')  

D13/03 Download D13/03 (DOC) - English Download D13/03 (PDF) - English

whether trading activities - flats purchased and sold within short duration  

D9/03 Download D9/03 (DOC) - English Download D9/03 (PDF) - English
SALARIES TAX    

appeal out of time - whether reasonable excuse - s 66 of the Inland Revenue Ordinance ('IRO')  

D2/03 Download D2/03 (DOC) - English Download D2/03 (PDF) - English

assets betterment statement - ss 66(1) and 68(4) of the Inland Revenue Ordinance ('IRO')  

D3/03 Download D3/03 (DOC) - English Download D3/03 (PDF) - English

extension of time - busy work schedule and oversight - s 66 of the Inland Revenue Ordinance - whether income derived from employment of profit. [Decision in Chinese]  

D4/03 Download D4/03 (DOC) - Traditional Chinese Download D4/03 (PDF) - Traditional Chinese

new or continuous employment - 60-day exemption - ss 8(1), 8(1A), 8(1B) and 11B of the Inland Revenue Ordinance ('IRO')  

D30/03 Download D30/03 (DOC) - English Download D30/03 (PDF) - English

restructuring of a bank leading to the closure of a department where the appellant was employed - assessability of a sum paid by the bank on the cessation of the employment of the appellant - onus of proof on the appellant  

D36/03 Download D36/03 (DOC) - English Download D36/03 (PDF) - English

source of income - whether arising in or derived from Hong Kong - statutory exemption - whether all services rendered outside Hong Kong - 60 day grace period - visits - s 8, 8(1A) and 8(1B) of the Inland Revenue Ordinance ('IRO')  

D27/03 Download D27/03 (DOC) - English Download D27/03 (PDF) - English

taxability of income arising from employment with constituent members of multi-national groups of companies - s 8(1) and 8(1A) of the Inland Revenue Ordinance ('IRO')  

D37/03 Download D37/03 (DOC) - English Download D37/03 (PDF) - English

whether a sum paid by an employer to an employee on the completion of contract was a gratuity - whether it is chargeable income - onus of proof on appellant - ss 8(1)(a), 9(1)(a) and 68(4) of the Inland Revenue Ordinance ('IRO') - ss 31B(1), 31B(2) and 31D(1)(b) of the Employment Ordinance ('EO')  

D12/03 Download D12/03 (DOC) - English Download D12/03 (PDF) - English

whether a sum received by the appellant was income derived from an office or employment of profit - whether chargeable for salaries tax - appeal out of time - onus of proof on the appellant - s 66(1) and 66(1A) of the Inland Revenue Ordinance ('IRO'). [Decision in Chinese]  

D7/03 Download D7/03 (DOC) - Traditional Chinese Download D7/03 (PDF) - Traditional Chinese

whether income derived from services rendered in Hong Kong - sum paid in consideration of a restrictive covenant - s 8(1) and 8(1A)(a) of the Inland Revenue Ordinance ('IRO')  

D139/02 Download D139/02 (DOC) - English Download D139/02 (PDF) - English

whether or not the appellant rendered outside Hong Kong all the services in connection with his employment with the employer - s 8(1A)(b)(ii) and 8(1B) of the Inland Revenue Ordinance ('IRO') - meaning of the word 'days' in s 8(1B) of the IRO  

D11/03 Download D11/03 (DOC) - English Download D11/03 (PDF) - English

whether the sum of money is a rental refund or a salary - s 9(1A) of the Inland Revenue Ordinance ('IRO') - whether or not landlord and tenant relationship is crucial in a claim under s 9(1A)(a)(ii) of the IRO - whether or not it is necessary to have a nexus between the payment by the employee and his or her use of the property for which the rent is paid  

D35/03 Download D35/03 (DOC) - English Download D35/03 (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 30.11.2003), please click here.

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