Self Assessment for income in Hong Kong

Hi, I had migrated to UK with BNO visa in August 2021 and continued my original contract with my employer in Hong Kong as remote staff. My salary is paid in Hong Kong with Hong Kong Dollar. For taxation year 2021-2022, I have to pay income tax in Hong Kong as I was there from April to July 2021. Should I have tax return to HMRC for the income after I moved to UK in period August 2021 to March 2022? Or the income from this taxation year is considered taxed in Hong Kong and exempted for UK tax return under UK-Hong Kong tax treaty? Moreover, if I go to have tax return in UK by Self-Assessment, should only the take-home pay be considered? Part of my salary is deducted for Mandatory Provident Fund (MPF), which is a compulsory pension contribution in Hong Kong eligible for tax exemption. Thank you very much.

Hi,

Please see the double taxation treaty between the UK and Hong Kong. Article 14 suggests this income would remain taxable in Hong Kong. However, if you are a UK resident for tax purposes for the 2021/22 year then you are required to declare your worldwide income on a Self Assessment form.  

Hong Kong: tax treaties

With regards to the MPF and if this qualifies for tax exemption, you would need to check if this is a qualified overseas pension by checking the recognised overseas pension schemes notification list:

Check the recognised overseas pension schemes notification list

Any further information on whether your pension scheme is a qualified one or not will need to be directed to our pension scheme services.  

Once the facts are established this will allow you to decide if the gross or net of pension contritbutions figure is declared as your taxable income. 

Thank you.
 

Hi HMRC Admin I am filing my tax return and am in a similar situation. May I further clarify that when you say "Article 14 suggests this income would remain taxable in Hong Kong", you are referring to the income before Eastern moved to the UK (April to July 2021). On the other hand, should the income after he moved to the UK (Aug 2021 onward) be taxable in the UK because he is a UK tax-resident in year 21-22? Even though that income was earned by working remotely for his Hong Kong employer, he was physically present in the UK while producing his work so his work is still counted as "Duties performed in UK" and is considered as UK income. Is it correct? Thank you.

Hi smallfishba,

If you are UK tax resident then you need to declare any foreign income to the UK.
Article 14 suggest this and may also be taxed in Hong Kong if any of the duties are carried out there, unless the income is paid through the UK subsidiary and through a UK payroll. 

Thank you.

Dear HMRC Admin, I would like to seek your help also. I migrated to UK from Hong Kong with BNO visa in June 2021. I received a bonus from my former employer in Hong Kong end of 2021. As I had quitted the job before coming to UK, do I still have to file this income in fiscal year 2021/2022? I really appreciate your help. Thanks for your advice in advance.

Hi,

As the income relates to duties wholly carried out in Hong Kong, you do not need to declare it in the UK.

Thank you.

Dear HMRC Admin 19, thanks for your advice. It's very helpful. I really appreciate that.

Dear HMRC Admin, I have similar case with Eastern , that is, work remotely for my Hong Kong employer as employee after I moved to UK since Jun 2022, the payroll in paid into my Hong Kong Bank Account. There is no establish in UK for my Hong Kong employer. No company clients in UK. I still paying tax to Hong Kong tax department. May I know: 1. is it qualified to apply remittance basis for my employment income? (I am UK Tax resident but non-domicile in UK at this moment) 2. If employment income is not eligible for remittance basis. Then I will choose to use arising basis. May I clarify do I need to pay NI if the employment is from Hong Kong company? 3. If no need pay NI, so I just submit the tax return for self assessment under "not self employed" once a year. Right? 4. If need to pay NI, how to do? Thanks in advance and look forward to receiving your reply!

Hi grace31,

Article 14 of the UK / Hong Kong double taxation agreement covers employment income.  

Who you are employed by and how much time you spend in Hong Kong can determine where your income is taxable. Guidance can be found here-

2010 Hong Kong-UK Data

If your income is taxable in the UK, it should be reported on a self assessment tax return.  

You will need to review the guidance on resident, domicile and remittance here -

Guidance note for residence, domicile and the remittance basis: RDR1

to determine if the remittance basis is appropriate and beneficial to you.

You will also need to contact National Insurance: general enquiries

Thank you.

 

Dear HMRC Admin, I’m from Hong Kong and are living in UK for over 1.5 year with BNO visa. I’m a UK tax resident now. However, I work for a Hong Kong employer with business in Hong Kong only. As my income tax and employee NI contribution are not deducted monthly from my salary, may I know how can I pay employee NI contribution per month? Do I need to apply for a PAYE employer account to pretend my employer to report my salary each month for employee NI contribution? Or I just need to fill in the self-assessment form to report my annual salary once per tax year? Thanks

Dear HMRC Admin, According to treaty I am a resident in Hong Kong and the UK for the last five years. However, I spent over 200 days in Hong Kong and received full-time employment income from a university in Hong Kong. I have certificates of residency issued by the Hong Kong Tax Office for the last five years. My understanding of Article 14, I pay Hong Kong Tax on my Hong Kong employment income and UK tax on my UK employment income. Is this right interpretation? If it is the right interpretation, do I need to report my Hong Kong employment income in my UK self-assessment? Thanks 

Hi Wing,

Please refer to guidance at Tax on foreign income

Thank you.

Hi David Wong,
If you are tax resident in the UK you need to declare your worlwide income.
Credit can be given for the tax paid in Hong Kong:
Tax on foreign income
Thank you.