Question 1 (15 marks) Mr Pang is a director and shareholder of two Hong Kong companies, AA Company and BB Company. BB Company is a wholly owned subsidiary of AA Company During the year ended 31 March 2014, you have been supplied with the following information in respect of Mr Pang: AA Company (S) BB Company ($) (1) Salaries 600.000 120,000 (2) Bonus 75,000 10,000 (3) Dividend 150,000 100,000 (4) Mr Pang rented a flat for his residence at a monthly rent of $30,000. BB Company refunded $28,000 to him. (5) On 15 August 2013, Mr Pang received a notice of salaries tax assessment from the Inland Revenue Department with salaries tax of $88,000 and $13,000 due on 3 January 2014 and 3 April 2014 respectively. AA Company paid the tax for Mr Pang on the due dates. (6) Mr Pang earned a gain on share options of $375,000. (7) Mr Pang paid the following expenses: Allowable outgoings and expenses: $8,000 Salary to domestic helper $36,000 REQUIRED: (a) Compute Mr Pang's salaries tax liability for the year of assessment 2013/2014. Ignore provisional salaries tax and tax rebates or reduction, if any. (10 marks) (b) What are the salaries tax implications on rent refund and housing allowance? (5 marks) Question 1 (15 marks) Mr Pang is a director and shareholder of two Hong Kong companies, AA Company and BB Company. BB Company is a wholly owned subsidiary of AA Company During the year ended 31 March 2014, you have been supplied with the following information in respect of Mr Pang: AA Company (S) BB Company ($) (1) Salaries 600.000 120,000 (2) Bonus 75,000 10,000 (3) Dividend 150,000 100,000 (4) Mr Pang rented a flat for his residence at a monthly rent of $30,000. BB Company refunded $28,000 to him. (5) On 15 August 2013, Mr Pang received a notice of salaries tax assessment from the Inland Revenue Department with salaries tax of $88,000 and $13,000 due on 3 January 2014 and 3 April 2014 respectively. AA Company paid the tax for Mr Pang on the due dates. (6) Mr Pang earned a gain on share options of $375,000. (7) Mr Pang paid the following expenses: Allowable outgoings and expenses: $8,000 Salary to domestic helper $36,000 REQUIRED: (a) Compute Mr Pang's salaries tax liability for the year of assessment 2013/2014. Ignore provisional salaries tax and tax rebates or reduction, if any. (10 marks) (b) What are the salaries tax implications on rent refund and housing allowance