How to Compute Tax on Salary | PAANO MAG COMPUTE NG TAX SA SWELDO

Summary

This video script discusses the intricacies of withholding taxes on various forms of employee compensation, including overtime pay, hazard pay, and profit sharing. It provides a detailed explanation of the tax implications for employees in Hong Kong from 2023 onwards, using a case study to illustrate how withholding tax is calculated. The video also touches on the statutory minimum wage and offers a comparison of the tax rates for 2022 and 2023, emphasizing the importance of understanding tax obligations for both employers and employees.

Takeaways

• 📅 The video discusses changes in withholding tax regulations for 2023 and onwards, indicating a shift from previous years.
• 💼 It covers various forms of employee compensation, including overtime pay, director's fees, profit sharing, and hazard pay, which are subject to withholding tax.
• 🌟 The video highlights the importance of understanding how to calculate withholding tax on supplementary compensation.
• 💰 It provides a specific example of how withholding tax is calculated for an employee earning 27,000, illustrating the process for both 2022 and 2023.
• 📊 A comparison is made between the withholding tax rates for 2022 and 2023, showing a decrease from 15% to 13.35% for certain income brackets.
• 📈 The script mentions a new withholding tax table effective from January 2018 to December 2022, and an updated one for 2023 onwards.
• 💡 The video emphasizes the need for accurate computation of withholding tax to ensure compliance with tax regulations.
• 📋 It mentions the use of a certificate of compensation payment or Form 2316 for recording tax withheld.
• 🚫 The script clarifies that certain benefits, like hazard pay, are taxable and subject to withholding tax.
• 🎉 The video encourages viewers to engage with the content by liking, sharing, and subscribing for more informative videos.

Q & A

What is the topic of the video called 'The discus'?

The video discusses withholding tax on compensation, covering various forms of employee remuneration such as overtime pay, director's fees, profit sharing, and other benefits.

What types of employee benefits are mentioned in the video as being subject to withholding tax?

The video mentions benefits such as hazard pay, 13-month pay, and other remunerations received from an employer-employee relationship as being subject to withholding tax.

What is the significance of the term 'withholding tax on compensation'?

Withholding tax on compensation refers to the tax that is deducted from an employee's salary or wages by the employer and remitted to the tax authorities on behalf of the employee.

What is the difference between the withholding tax treatment for 2022 and 2023 as per the video?

The video highlights a change in the withholding tax computation for the years 2022 and 2023, with specific rates and computations detailed for each year.

What is the statutory minimum wage mentioned in the video, and how does it relate to withholding tax?

The statutory minimum wage is a legal minimum amount that employees must be paid per hour, and it is a factor in calculating withholding tax, especially for minimum wage earners.

How does the video explain the withholding tax computation for someone earning a basic pay of 27,000?

The video provides an example of how to compute the withholding tax for an individual with a basic pay of 27,000, detailing the steps and resulting tax amount.

What is the purpose of Form 2316 mentioned in the video?

Form 2316, or the Certificate of Compensation Payment on Tax Withheld, is used to report the amount of tax withheld from an employee's compensation.

What is the relevance of the terms 'not taxable era' and 'downtown' in the context of the video?

The terms 'not taxable era' and 'downtown' are used to explain specific periods or areas where certain types of income might be exempt from tax or where tax regulations might differ.

How does the video encourage viewers to engage with the content?

The video encourages viewers to give a thumbs up, share the video, subscribe, and enable notifications to support the creation of more informative videos.

What is the role of the speaker, Kirari, in the video?

Kirari is the presenter of the video, providing information and guidance on withholding tax and its implications for employees and employers.