Hong Kong Ordinances

INLAND REVENUE ORDINANCE - SECT 11D

Receipt of income

For the purpose of section 11B-

   (a)  income which has accrued to a person during the basis period for a
        year of assessment but which has not been received by him in such
        basis period shall not be included in his assessable income for that
        year  of assessment until such time as he shall have received such
        income, when notwithstanding anything contained in this Ordinance, an
        additional assessment shall be raised in respect of such income:
        Provided that for the purposes of this paragraph income which has
        either been made available to the person to whom it has accrued or has
        been dealt with on his behalf or according to his directions shall be
        deemed to have been received by such person;

   (b)  income accrues to a person when he becomes entitled to claim payment
        thereof: Provided that-

        (i)    any lump sum payment received on or after 1 April 1966, being a
               lump sum payment or gratuity paid or granted upon the
               retirement from or termination of any office or employment or
               any contract of employment of an employee or a lump sum payment
               of deferred pay or arrears of pay arising from an award of
               salary or wages, whether such a payment is paid by an employer
               to a person during employment or after that person has left his
               employ, shall upon the application in writing of the person
               entitled to claim payment thereof within 2 years after the end
               of the year of  assessment in which the payment is made be
               related back and shall then be deemed to be income which has
               accrued during the periods in which the services or employment,
               in respect of which the payment was made, were performed or
               exercised, or, if the relevant periods of service or employment
               exceed 3 years, the payment shall be deemed to be income
               accruing at a constant rate over the 3 years ending on the date
               on which the person became entitled to claim payment thereof or
               ending on the last day of employment, whichever is the earlier;
               and, notwithstanding section  70 , an application made by any
               person under this proviso for the adjustment of an assessment
               shall, to that extent, be regarded as a valid objection to the
               assessment under section 64; and

        (ii)   subject to proviso (i), any payment made by an employer to a
               person after that person has ceased or been deemed to cease to
               derive income which, if it had been made on the last day of the
               period during which he derived income, would have been included
               in that person's assessable income for the year of assessment
               in which he ceased or is deemed to cease to derive income from
               that employment, shall be deemed to have accrued to that person
               on the last day of that employment. (Added 8 of 1973 s. 5.
               Amended 71 of 1983 s. 7)