HKICPA QP Module 9 Principles of Taxation key terms
HKICPA QP Module 9 Principles of Taxation · Get comfortable with the vocabulary.
- Year of assessment
The reference tax period relevant to the charge and applicable rules, distinguished from assuming every receipt belongs to the date a worksheet was prepared.
- Assessable income
Income brought into the relevant tax computation under its applicable rules before assuming that every deduction or allowance has already been subtracted.
- Net income
The relevant income after allowable deductions in a salaries-tax computation, distinguished from net chargeable income after personal allowances.
- Net chargeable income
The salaries-tax base after the relevant deductions and personal allowances for the progressive calculation, distinct from the standard-rate comparison base.
- Personal allowance
A qualifying reduction used in the relevant individual tax calculation, which is not automatically a cash refund equal to its face amount.
- Standard-rate comparison
The comparison calculation using the applicable standard rates and base, distinguished from adding that amount to the progressive tax result.
- Tiered rate
A rate structure applying different rates to defined portions of the base, rather than retrospectively applying the highest rate to the entire amount.
- Assessable profits
The profits brought into a relevant profits-tax computation under the applicable rules, which need not equal the accounting profit shown in financial statements.
- Source of profits
The location determined through the relevant profit-producing facts and legal framework, not necessarily the place of incorporation or receiving bank account.
- Statutory deeming
A rule supplying a legal treatment where its conditions apply, which must be checked rather than ignored because a receipt has a foreign-source label.
- Tax adjustment
An explained change connecting accounting records with the applicable tax basis, distinguished from concealing a difference by altering the original transaction.
- Capital allowance
Relief determined under the applicable asset and tax rules, distinguished from automatically accepting the financial-reporting depreciation charge as the deduction.
- Net assessable value
The property-tax base determined after the relevant permitted adjustments and statutory allowance, rather than gross rent without examination of the conditions.
- Irrecoverable rent
Rent that meets the applicable conditions for treatment as irrecoverable, distinguished from a voluntary waiver automatically assumed to be deductible.
- Owner-paid rates
The relevant rates agreed to be paid and paid by the owner in the property-tax computation, distinguished from every management or government-rent payment.
- Statutory property allowance
The defined allowance for repairs and outgoings in the property-tax computation, which is not automatically supplemented by every actual repair bill.
- Personal Assessment
An eligible individual election involving a combined calculation under its conditions, whose benefit should be compared rather than universally assumed.
- Provisional tax
An amount charged in advance under the applicable process and credited to the relevant final liability, which may produce a balance or excess credit.
- Notice of assessment
A formal assessment record relevant to the charge and review process, distinguished from merely preparing a return or making a payment.
- Objection
A challenge through the applicable process with relevant grounds and timing, distinct from uncommunicated disagreement or simply editing a private copy.