What does IRD do if I do not file the return or audited accounts?

What IRD's materials say

• The BIR51 notes list failing to comply with a notice to make a return, without reasonable excuse, among the offences. IRD's Penalty Policy says failing to furnish a return in time is prosecuted under s.80(2): a fine of HK$10,000 plus treble the tax undercharged, and the court may order the return to be furnished. Evasion is more serious: a fine of HK$50,000 plus three times the undercharged tax, and imprisonment for up to three years.
• IRD may also impose additional tax (s.82A) under the loading scales in its Penalty Policy, which depend on the type of case.
• When no return is filed, IRD may raise an estimated assessment under s.59(3). To object, you must file a completed return with your objection letter, and the objection must reach IRD within one month of the notice.

What you can do

1. File the return on time, using the block extension if a tax representative is acting.
2. If the audit will not be ready, ask your representative about a further extension before the due date; out-of-time requests are generally refused.
3. If an estimated assessment arrives, you have one month to object, so act at once and seek advice.

Pointer Tax computation and objection procedures are profits tax topics outside this lesson.

This answer relates to tax filing only; it does not remove the Companies Ordinance audit duty.