Editor’s Note: This article was published in April 2019. It has been updated in March 2021 by Nan An and Jesslyn Phoon. It has also recently been updated in February 2023 by Hern Yee, Wong to reflect the latest updates to the Hong Kong Tax Filing/Submission process.
There are two kinds of people in this world: those who file taxes early and those who file their taxes as early as a day before the deadline. As tax season gets off to a start in Hong Kong, many SMEs and first-time business owners will be scrambling to get their accounts and numbers in order. This is especially hard if you have to do it all by yourself.
So, we’ve put together everything you need to know about IR56B submission. Whether you’re filing it for the first time or for the seventh consecutive season, you’ll find something useful in this article.
What is IR56B?
It is a form that helps the Inland Revenue Department (IRD) to calculate the tax contribution for your employees. The form requires the following information for each employee:
- Personal particulars
- Job position in the company
- All salary, benefits and pensions they receive
IR56B submissions must be done every year in April, and IRD will calculate the taxes pertaining to the salary earned from 1st April of the previous year to 31st March of the current year.
(Example: When filling in April 2023, you are filling based on payroll records from 1st April 2022 to 31st March 2023.)
When is the submission period?
1st April – 30th April.
If an employer fail to file the tax returns, he/she can be charged under Hong Kong law by IRD. Depending on the severity of the offence, the Inland Revenue Commissioner can require that:
- the company pay additional tax as a penalty,
- the company pay a fine, or
- the person authorised to complete the tax return forms is imprisoned.
What are the requirements for filing IR56B?
According to the tax obligations stipulated by IRD, you’ll have to report your employees’ income tax for 2022/23 if she or he is:
- single and paid an annual income of $132,000 or more
- married (regardless of amount)
- a part-time staff (regardless of amount)
- a director (regardless of amount)
As an employer (with regards to filing an Employer’s Return in Hong Kong), you’ll need to record the following information for your employees immediately upon hire:
- Personal particulars (e.g. name, address, Hong Kong identity card or passport number, marital status)
- Nature of employment (i.e. full-time or part-time)
- Job title
- Amount of salary paid
- Non-cash or additional benefits (e.g. housing or accommodation, vacation allowances, stock awards and share options)
- Employer’s and employee’s contributions to the Mandatory Provident Fund (MPF) or its equivalent
- Employment contract and amendments to terms of employment
- Period of employment
You should keep these records for at least 7 years, and update the Inland Revenue Department accordingly if there are any changes.
Additional information the form submission
|Form||Employment Condition||Statutory Period for Notification||Reference in Inland Revenue Ordinance (IRO)||Remarks|
|IR56B||Still under employment as at 31 March||1 – 31 April 2023||section 52(2)||Must be submitted together with BIR56A|
How to file IR56B for free on Talenox
In this day and age, you don’t have to download the payroll history report from your payroll system for reference as you manually fill in the IR56B form for each employee.
Check out the video below on how you can easily fill in IR56B forms in a few clicks, using a Talenox Free Plan. Do note that:
- As long as you’ve ran payroll on Talenox for the past financial year, you can easily print out IR56B forms from Talenox to mail to IRD.
- If you’ve not ran payroll with Talenox in the past financial year, you can still sign up for a Talenox FREE account anytime and process payroll for the entire financial year first, and then generate the form immediately.
Talenox even has a Tax module for your employees to view and download their tax forms directly from their Talenox account. This eliminates the manual step of having to print out the tax forms to share with each of your employee for reference.
Additional reading on IRD and IR56B
- Electronic filing of employer’s return
- Tax information for employers
- Notes and instructions for IR56B (PDF)
- A Brief Guide to Employee Tax Submission in Hong Kong
- Hong Kong Employer’s Return and IR56 – The Basics