What is the IR6036B Form in Hong Kong?

If you’re running or managing a company in Hong Kong, you’re no stranger to the myriad of responsibilities that come with it. From keeping your team happy to ensuring everything ticks along smoothly, there’s a lot on your plate. And let’s not forget the paperwork – oh, the paperwork! Alongside having to file countless tax forms like IR56B (for annual salaries), IR56E (for new employees), and the ever-important IR56F and IR56G (for departing employees), there’s one form that often prompts a lot of questions – the IR6036B. It’s like that mysterious term that not many talk about openly, but should. Let us help you break it down in layman’s terms.

So, what exactly is IR6036B?

When you go to the IRD website, it terms the IR6036B as the “covering letter for notification of remuneration paid to persons other than employees”. Umm, okay… but why do we need to have a covering letter of remuneration paid to non-employees?

Well, this form comes into play when your business pays individuals who aren’t on your regular payroll – think freelancers, consultants, or contract workers. They may include agents that you work with, brokers, entertainers, sub-contractors, and writers. etc. The list is quite extensive so it is best to check with Inland Revenue Department (IRD). 

IR6036B is similar to IR56M, as IR56M is the “notification of remuneration paid to persons other than employees”. 

The key difference between IR56M and IR6036B is that one is a form documenting remuneration amounts, while the other a cover letter that accompanies the form. 

To give you a pictorial comparison, these are example screenshots of IR56M and IR6036B.

In addition to Forms BIR56A and IR56B which are applicable to employees’ remunerations, you may need to enclose Forms IR6036B, IR6036C and IR56M for you to furnish information about payments made to these non-employees.

Talenox’s tip: Submit the whole set of completed Forms IR56M to the Inland Revenue Department (IRD) with the IR6036B cover letter.

Where can I download the relevant forms?

For all tax forms, you may download them from the official Inland Revenue Department (IRD) website here. These forms may be updated and changed over time, so I strongly recommend that you give the Inland Revenue Department’s (IRD) website a quick check every time you plan to submit a form. 

Real-world applications of IR6036B and IR56M

Engaging a Freelance Graphic Designer:

Imagine you’ve hired Alex, a freelance graphic designer, for some upcoming advertising campaigns. Once the project is completed and Alex is compensated, you’ll use IR603B as a cover letter to notify the IRD about the remuneration paid to Alex for his services.

In addition, you will file IR56M which documents his particulars (i.e. company, business registration number, date of service rendered, etc). You will also submit the amount of remuneration paid to Alex in the form.

Consulting with a Business Strategist:

You bring on Jamie, an independent business strategist, for a three-month consultancy. After successfully enhancing your business strategy and receiving her payment, you’ll file IR603B to report the fees paid to Jamie.

You will also fill out IR56M and fill out the consultancy/management fees paid to Jamie. 

Contracting with a Temporary IT Specialist:

For an IT system upgrade, you contract Sam, a specialist for a short-term assignment. Upon completing the work and getting paid, Sam’s remuneration would be reported under IR6036B, acknowledging his contribution as a non-employee. 

You will also fill out IR56M and pay him under “Subcontracting Fees”. 

A copy of the completed Form IR56M should be given to each of the recipients above for completing his/her tax return. Once all these IR56M forms are filled out, you will then proceed to submit a single IR6036B form. 

How do I submit the IR6036B and IR56M forms?

For convenience’s sake, you may submit them in digital formats.

1. You may use a CD-ROM / DVD-ROM / USB storage device containing the IR56M. Create a label on the CD-ROM/ DVD-ROM/ USB storage device the name of Payer, Payer’s employer’s file number / Business Registration number / Hong Kong Identity Card number and the year of assessment. Put the storage device in an envelope. Then, staple the envelope securely to the Form IR6036B and a signed control list before filing. However, you will need to first seek approval from IRD on whether you are able to submit the records in this format. 
2. You may also file IR6036B and IR56M electronically via eTAX. Please visit www.ird.gov.hk/eng/tax/err.htm for details.

Talenox’s tip: Forms IR56M should be submitted in alphabetical order of the name of recipient.

Is there a minimum or maximum payment amount for IR56M Forms?

Yes.

Take note that local persons in respect of whom Forms IR56M should be submitted include:

-(a) Consultants, agents, brokers, freelance artistes, entertainers, sportsmen, writers, freelance guides, etc. to whom commission, fees or other remuneration paid exceeded a total of $25,000 per annum for the relevant year ended 31 March.
(b) Sub-contractors to whom fees or other remuneration paid exceeded a total of $200,000 per annum for the relevant year ended 31 March.

Talenox’s Tip: Form IR56M is not required for payments made to corporations or non-local persons. For payments made to non-resident entertainers and sportsmen, please complete IR623.

How Talenox can simply filing tax forms for you

Having a reliable software like Talenox is like having a digital HR ally, ready to:

• Organise Your Records: With intuitive design, Talenox helps you keep track of all payments to non-employees, ensuring that nothing slips through the cracks.
• Streamline Submissions: Talenox can guide you through preparing your IR 6036B submissions, making the process as painless as possible.
• Access Anywhere, Anytime: Being cloud-based, Talenox gives you the freedom to manage your IRD submissions on your schedule, wherever you may be.

What are you waiting for? Simply your tax filing and make your work easier. Get started on a free 30-day trial with Talenox today.