2. What are the current rates for salaries tax?
Tax rates for the year of assessment 2009/10 and onwards (also applicable to Personal Assessment):
|
Net chargeable income |
Progressive rate |
|---|---|
|
on the first $40,000 |
2% |
|
on the next $40,000 |
7% |
|
on the next $40,000 |
12% |
|
upon the remainder |
17% |
Net total income (Total Income – Deductions) < Standard rate: 15%
Salaries Tax is chargeable on your net chargeable income at progressive rate OR your net total income at standard rate, whichever is the lesser. Base on the above table, progressive rate is more advantageous to people with relatively lower income. On the other hand, standard rate will give more concession to people earning relatively higher income (since progressive rate will charge 17%, but not 15%, on the income after the first $120,000).
Please go to the next question for an illustration of how to compute salaries tax.
For more details on tax rates, you may also refer to the Inland Revenue Department's "Allowances, Deductions and Tax Rate Table".
Print
Email