The Hong Kong Inland Revenue Ordinance (“IRO”) requires that the employer of an employee who is chargeable to Salaries Tax and is about to leave Hong Kong for a period exceeding one month due to emigration, study or work abroad to give notification to the Hong Kong Inland Revenue Department (“IRD”) not later than 1 month before the expected departure date, except for employees who frequently travel in the course of their employment. The following are the frequently asked questions regarding tax clearance to be done by an employer:

Q:	How should the employer notify IRD of employee’s departure?
A:	The employer should notify the IRD in writing by completing and filing the relevant IRD Form not later than 1 month before the expected departure date and provide a copy of it to the employee.
Q:	What should the employer do aside from filing the relevant IRD Form?
A:	The employer should also withhold all payment of money or money’s worth to that employee for a period of one month from the date on which the relevant IRD Form was given or until IRD issues a “letter of release”, whichever is earlier.
Q:	What should the employer do if the employee fails to pay up his taxes?
A:	In such case, IRD will issue a garnishee notice to the employer requiring the employer to pay the money withheld to IRD. The employer’s compliance with IRD’s garnishee notice will constitute sufficient defence at court against any claim for non-payment of salaries to that employee.
Q:	Does the employer need to file the relevant IRD Form again if additional remuneration will be paid to an employee?
A:	Yes, the employer must go through the tax clearance process again. The employer should file an additional IRD Form if additional remuneration is paid and withhold all moneys payable to that employee for a period of 1 month from the date of filing the relevant additional IRD Form.
Q:	Does the employer need to notify IRD if the employee exercises the share option which the employer has previously granted him after his departure from Hong Kong?
A:	Yes, the employer must submit IRD Form for the relevant year of assessment if that employee exercised share options previously granted after the tax clearance, except when the employee has previously elected for a notional exercise for those share options.