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Self-employed Person

Reporting relevant income


Irrespective of whether you choose to contribute on a monthly or a yearly basis, you should report to the trustee your relevant income at least 30 days before the end of the financial year of the scheme. This will be used as a reference for calculating your mandatory contributions for the next financial year. You should also choose between monthly or yearly contributions for the next year at least 30 days before the end of the financial year of the scheme. Your trustee would provide a specific declaration form to facilitate your reporting.

As an SEP, you may use your assessable profits calculated in accordance with the Inland Revenue Ordinance as your relevant income for calculating mandatory contributions. Therefore, you can submit your most recent notice of assessment as proof of your relevant income.
If you cannot present your most recent notice of assessment - if, for example, you have only become self-employed recently and have yet to file your tax return - one of the following can be taken as your relevant income:
  • the “basic allowance” defined under the Inland Revenue Ordinance if you satisfy your trustee that you are unable to provide evidence of your relevant income;
  • the income as declared in a written income declaration to your trustee (SEPs are reminded that it is a criminal offence to make a false or misleading declaration to the trustee and offenders may be prosecuted); or
  • the maximum level of relevant income of $360,000 per year if you do not produce evidence of relevant income.
If you are a partner in a business, your relevant income for the financial year of the scheme should be calculated by making a proportional adjustment of the profits according to your share of partnership for that year. If you are a partner in more than one business, your relevant income should be the aggregate of your income derived from all those businesses for that year.

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