Buying a flat is more a decision of how than whether
Question: I have recently been offered the option to buy the flat I am now renting. A friend mentioned to me that I could arrange to buy it through a company. How would this benefit me? Answer: If you are currently receiving rent reimbursement from your employer, then you should consider acquiring the flat through a private service company. You may then continue to enjoy the beneficial tax treatment afforded to employees whose employer meets the cost of their accommodation.
The tax saving through the application of the rental value (i.e. gross taxable income x 10 per cent) for salaries tax purposes would not apply if you purchase the property in your own name and any accommodation allowance would then be fully taxable.
Question: My firm has decided to dismiss a member of staff now in the post of 'senior executive' and thereafter such a post will no longer exist.
Should we pay the dismissed staff member severance payment or long service payment? How is the amount payable calculated? Answer: In addition to the other entitlements upon termination of employment, you are required to pay the dismissed person a severance payment because he is to be dismissed by reason of redundancy.
The staff member will not be entitled to any long service payment.
According to the Employment Ordinance, an employee who has worked continuously for his employer for a period of not less than 24 months immediately prior to dismissal is entitled to severance pay at the rate of two-thirds of one month's pay or two-thirds of HK$15,000 - whichever is less - for every year of service.
An incomplete year of service at the time of redundancy will be calculated on a pro-rata basis.
The maximum severance payment should not exceed the total amount of wages earned during the period of 12 months, or $180,000 (whichever is less) immediately prior to dismissal or lay-off.
The severance payment needs to be reduced by the amount of any contractual gratuity or retirement scheme payment payable to the employee (excluding the portion contributed by the staff member himself).