GEN1000 Perspectives on General Education / Subject to discretion of Module Coordinator
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This module aims to introduce students with the fundamental tax knowledge and ethical principles, and to apply them in scenarios commonly encountered by individual and corporate taxpayers, such as employment, self-employment, deduction claims, tax planning and stamp duty issues. Through a combination of lectures and scenario-based class discussions, students examine a range of contentious tax issues in various scenarios based on the relevant tax principles and evaluate the tax decisions with ethical considerations.
Upon completion of this module, students should be able to:
a. Understand the philosophy of taxation, Hong Kong tax policy and system
b. explain the ethical theories and the importance of ethical consideration in tax practices
c. analyze various tax scenarios with relevant tax principles and identify possible tax issues
d. recognize ethics implications and dilemmas in various tax scenarios and critically evaluate the decisions from both tax and ethical perspectives
1. Understanding ‘Tax’
1.1 What is ‘tax’?
1.2 Why people get taxed?
1.3 Why people pay or fail to pay tax?
1.4 Is tax ‘fair’?
2. Hong Kong tax policy and system
2.1 Who are taxpayers?
2.2 How tax is collected and spent?
2.3 Hong Kong Tax System
2.4 What should taxpayers do?
2.5 What should Inland Revenue do?
2.6 What happens for non-compliance?
3. Ethical theories
3.1 Importance of ethics
3.2 Relationship between tax and ethics
3.3 Ethical theories and reasoning process
3.4 Professional Codes for Tax Practice
4. Tax scenario – related to tax on employment
4.1 Salaries tax and compliance
4.2 Housing arrangement
4.3 Onshore vs offshore employment
4.4 Dual contracts
4.5 Ethical implications of understatement of income from perspectives of individual employees and employers
5. Tax scenario – related to tax on self-employment
5.1 Profits tax and compliance
5.2 Self-employment vs Employment
5.3 Type II Service Company
5.4 Ethical implications of self-employed individuals to avoid tax
6. Tax scenario – related to deduction claims
6.1 Deduction rules
6.2 Personal allowance rules
6.3 Substance over form
6.4 Documentation
6.5 Fairness of taxation and tax non-compliance
6.6 Ethical implications of overstatement of expenses and related falsified documentation
7. Tax scenario – related to profits tax planning
7.1 Aggressive tax planning
7.2 Tax avoidance vs tax evasion (including contemporary cases)
7.3 Offshore establishment
7.4 Tax treaty shopping
7.5 Transfer pricing
7.6 Ethical conflict resolution process
7.7 Corporate social responsibility
8. Tax scenario – related to stamping
8.1 Stamp duty and compliance
8.2 Stampable instruments
8.3 No document, no stamp
8.4 Duty rate differentials
8.5 Ethical implications of aggressive stamp duty planning
1. Class participation (10%)
2. Case study report (25%)
3. Presentation (15%)
4. Examination (50%)
1. Ho, P.K.W. (2019). Hong Kong Taxation & Tax Planning. 18th edition. Hong Kong: Pilot Publishing Co. Ltd.
2. Lee, D. (2016). Advanced Taxation in Hong Kong. 18th edition. Pearson Education Asia Ltd.
3. Mackinnon, Barabara (2017). Ethics: Theory and Contemporary Issues. 9th edition. Australia: Wadsworth Publishing.
4. Lawrence, Anne (2019). Business and Society: Stakeholders, Ethics, Public Policy. 16th edition. McGraw-Hill Education.
5. Professional Codes of Ethics by Hong Kong Institute of Certified Public Accountants.
6. IRD website: http://www.ird.gov.hk/index.htm.
