Frank Fan is the general manager of MOET $($HK$)$ Limited $("$MOET$"),$ a company carrying on business in

Hong Kong. Frank oversees MOET's office in Beijing and travels to Hong Kong on a regular basis. The

following information is available in respect of Frank for the year ended $31$ March $2021$:

Frank's basic salary is $$80,000$ per month.

During the year, Frank spent eight months in China. Two$-$thirds of his salary was attributable to

services rendered in China, upon which he was required to pay $$140,000$ income tax to the

Chinese authority. The Chinese income tax was paid and borne by MOET.

For the month of April $2020,$ Frank was given a cash allowance of $$15,000$ to cover his

accommodation costs. From $1$ May $2020$ to $28$ February $2021,$ he was provided with a house

owned by MOET in Beijing, rent$-$free. On $1$ March $2021,$ he purchased the house from MOET

for $$800,000.$ The market value of the house at that date was $$1$ million.

MOET gave Frank an allowance of $$30,000$ to spend during his holidays in France. He actually

spent $$26,000$ and retained the balance.

On $1$ September $2020,$ Frank was given an option to purchase $10,000$ shares in MOET

$($International$)$ Ltd$,$ a company listed on the London Stock Exchange, at a price equivalent to

$$15$ per share. The market price on $1$ September $2020$ was $$15\mathrm{.}50$ per share. He exercised the

option on $30$ December $2020$ when the share price reached $$18$ per share.

Frank is studying for the MBA degree at the Tsinghua University, Beijing. During the year, he

paid a tuition fee of $$80,000,$ half of which was reimbursed by MOET.

Frank's wife is a Chinese resident employed by a Chinese company. Her salary is $$10,000$ per

month.

Frank has two children, aged $10$ and $12.$

Frank maintains his mother, aged $68,$ who lives with his family in Beijing. His mother has a Hong

Kong identity card and travels frequently to Hong Kong.

During the year, Frank made mandatory contribution of

Frank Fan is the general manager of MOET $($HK$)$ Limited $("$MOET$"),$ a company carrying on business in

Hong Kong. Frank oversees MOET's office in Beijing and travels to Hong Kong on a regular basis. The

following information is available in respect of Frank for the year ended $31$ March $2021$:

Frank's basic salary is $$80,000$ per month.

During the year, Frank spent eight months in China. Two$-$thirds of his salary was attributable to

services rendered in China, upon which he was required to pay $$140,000$ income tax to the

Chinese authority. The Chinese income tax was paid and borne by MOET.

For the month of April $2020,$ Frank was given a cash allowance of $$15,000$ to cover his

accommodation costs. From $1$ May $2020$ to $28$ February $2021,$ he was provided with a house

owned by MOET in Beijing, rent$-$free. On $1$ March $2021,$ he purchased the house from MOET

for $$800,000.$ The market value of the house at that date was $$1$ million.

MOET gave Frank an allowance of $$30,000$ to spend during his holidays in France. He actually

spent $$26,000$ and retained the balance.

On $1$ September $2020,$ Frank was given an option to purchase $10,000$ shares in MOET

$($International$)$ Ltd$,$ a company listed on the London Stock Exchange, at a price equivalent to

$$15$ per share. The market price on $1$ September $2020$ was $$15\mathrm{.}50$ per share. He exercised the

option on $30$ December $2020$ when the share price reached $$18$ per share.

Frank is studying for the MBA degree at the Tsinghua University, Beijing. During the year, he

paid a tuition fee of $$80,000,$ half of which was reimbursed by MOET.

Frank's wife is a Chinese resident employed by a Chinese company. Her salary is $$10,000$ per

month.

Frank has two children, aged $10$ and $12.$

Frank maintains his mother, aged $68,$ who lives with his family in Beijing. His mother has a Hong

Kong identity card and travels frequently to Hong Kong.

During the year, Frank made mandatory contribution of $$1,500$ monthly to the Mandatory

Provident Fund. Also, he made tax deductible voluntary contribution of $$5,500$ each month.

Required:

b$)$ Calculate the Hong Kong salaries tax payable by Frank Fan for the year of assessment $2020/2021,$

giving explanations of the treatment you have accorded for tax purposes to items $3.$ to $9.$ above.

$($Note: ignore tax rebate and provisional taxes$)$

$(16$ marks$)$