[Ponge]

I'll be moving to Hong Kong at the end of the month and I'm just trying to work out how much money I have to live on and what standard of life I can expect. So I've worked out this budget and i'd like some advice on whether you think it's feasible or whether I've made some glaring ommisions/errors.

For information I'm 22 years old, planning on renting an approx 600sqft apartment, no real need for a landline telephone.

Basic Info:
Salary:$215,000
Accomodation Allowance:$8,500

Taxable Income: 10% of $215,000 = 21500,
215,000+21500=$236,500
Tax due (according to Salaries Tax Computation )$9845
Mandatory Provident Fund (@5%) $10750

Net Salary - $194,405
Monthly Net Salary - $16,200
Monthly Housing Allowance - $8,500


Monthly Expenses:
Groceries - $2500
Mobile Phone - $120
Broadband - $200
Electricity - $400
Gas - $400
Water - $150
Transport - $500
Gym - $200 (My employer pays up to $240 for membershup)

Monthly total after expenses - $11,730
Daily total - $418

Does this all seem about right? I've not factored in any entertainment expenses (drinking, going out, eating out etc) as I'm not too sure on how much these things actually cost.

With my housing allowance quite low at $8500 I think I'd like to put some more money towards that to get a bit nicer place so my monthly total after expenses may be more like $10,000.

Also, a few questions regarding taxes.

1. Have I made my calculation regarding salary tax correctly? It seems quite low.
2. Am I right in thinking that taxes are paid annually and are not automatically taken out of your bank account?
3. Am I right in thinking that on your first salary payment they expect a double payment of 2 years worth of tax?
4. This Mandatory Provident Fund is about 5% yes?
5. What is to happen if (hypothetically) I were to return to the UK the month before taxes are to be paid? I assume they would just be payable if I ever returned to HK?


Thanks for your help guys! If anyone has actually read through all of that then I owe them a beer! (Budget permitting of course!)

[leghk]

2. Yes, taxes are not taken directly from wages. Usually you will not pay anything until Summer next year.
3. No. The advance payment is usually taken in your second year of employment.
4. MPF is usually not paid until your 2nd year of employment.(min. employee contribution is 5%)
5. No, before leaving the country you will need to settle your taxes with the IR. Otherwise, you may have problems when entering HK in the future.

* Am sure there are far more knowledgable people in this area on here who can answer your questions in more detail.

Your expenses

Add cable tv? - approx 150-400
Gas, too high - 100 per mth should be plenty
Transport too low (dependant on where you live) - check centamap.com or mtr website for commute costs.

Don't worry, you will be able to live comfortably out here on your salary.

[PDLM]

1 Yes, but note that your employer must exercise "proper control" in order for you to benefit from that tax treatment of housing allowance. That means keeping copies of your lease and receipts (which must be for at least the amount paid as allowance) and filling in forms appropriately for the Revenue. If you are planning to spend, say $10,000 then it would be tax advantageous (all other things being equal) to get your housing allowance put up to $10,000 and your salary down by $18,000.

2, 3 as leghk says.

4. It depends on the length of your contract. If it is for only one year then you would only pay MPF if it is renewed for a second year. If it is initially 2 years of more then you pay MPF from the second complete calendar month. It is 5%, capped at $1000 per month. You can get it back when you leave (once in your lifetime).

On expenses, gas is too high, as is water (perhaps $50/month). Electricity a little low perhaps for the summer but maybe you could keep it below $250 in winter. It depends on how hard you run your aircon.

Transport really depends on where you live and work, and how often you get lazy and take a cab. It is perfectly possible often to live within walking distance of the office (particularly if in Central and you live near the mid-levels escalator).

5. As leghk says. Your employer has a duty to inform the Revenue that you will be leaving and to withhold your last paycheck until they have confirmation from the revenue that you have settle your account. There was a first hand account here recently of someone being detained at immigration for tax avoidance.

[araucaria]

Do you get paid for this? Your dedication to the cause is truly awe-inspiring.

[PDLM]

Only very occasionally in beer by KIA.

[YvonneHau]

Other things to consider, if your renting a place you will need to pay at least 3 months in advance so will the monthly allowance cover that? Are you planning to live near work, wherever that maybe, or in the NT or DB where the rent is cheaper than say in Central? Will you need to furnish the place or will it already be included in the rent?

For gym membership you can go to the majority of the gyms but if you want to go to places like Pure then it would more likely be double that.

I agree with leghk that the transportation costs is a little on the low side, I would consider doubling it as it really is dependant on where you live, work and go out.

Do you need to buy any content or medical insurance?