South Asia and Far East WannabesA forum for those applying to Cathay Pacific, Dragonair or any other Hong Kong-based airline or operator. Use this area for both Direct Entry Pilot and Cadet-scheme queries.
I am looking for information on the take home monthly pay for a CX SO. The pay stated on the CX website is around 45k HKD per month. The tax is stated to be 12-15%. Am I correct in thinking that at the end of the month I will take home between 38250-39600 HKD? Why is it around 45k a month? Is there different rates for different experience on joining? Are there any little surprises I should know about that catch people out? Pollution levy or some other silly thing?
On the subject of money I would also like to know roughly how much you would be paid per month in per diems for layovers. I know that this shouldn't be taken into account when budgeting but I really would like to know what you could expect.
Last edited by pilotchute; 20th Sep 2012 at 12:31.
Another question while I'm here is when do you actually start getting the 45k? Is it when you graduate from FTA or when you finish your check to line? The time between both could be considerable which is why I ask.
You will get paid when you arrive in Hong Kong, it could take 6 months to be checked to line, you couldn't live that long without being paid, but CX could change their policy from time to time. You could reasonable expect:
Salary 36000 iCadet allowance 10000 Per Diems 3000-4000
You'll spend 10000 -15000 Rent 9000 Tax + Provisional tax could be another 9000 1000 phone 2000 Utilities 1000 transport 3000 - 4000 Food 5000 - Socialising 1000 - Maid
Laugh if you will, a night out on the turps will easily cost you 1000 bucks. Do it once a week (most likely 3 or 4 because you suffer peer group pressure and you're so bored) and it'll easily cost you 5000 per month. Been there done that. Don't ask if you don't want answers.
For a change, try to stop posting about things you have no idea about.
You're taxed on the cash element alone. If you do the long course, you have no tax liability. The manner in which you're taxed for the cash element is helpful; as extra monthly income each month for the 6 years. In the case of an AE cadet, about 7.6k a month.
So, make your own decisions, but don't listen to clowns like Underpants. 330k lump sum...haha
Actually Underpants is correct in that the entire forgivable loan is taxed. The loan is for HK$1.2m, not just the cash portion. In the eyes of the IRD it is irrelevant how the loan is spent. Under HK taxation law if a loan is forgiven it becomes income and is taxed at the highest applicable marginal tax rate. You are correct though in saying it is taxed over the six years as the loan is written down progressively over that time. That may change though as it appears CX has changed the contract and it appears now that it is forgiven only at the completion of six yearsí service which would mean that it would be taxed in the sixth year only.
So what you are trying to tell me is that if an iCadet decides to resign the day after he/she is checked to line all they have to pay back the company is the cash portion of the forgivable loan? If this is the case then you donít have any arguments from me. If on the other hand they have to pay back the entire HK$1.2m then it is most definitely 100% taxable and it is irrelevant what the company puts on their tax returns. The company has a very poor track record when it comes to employee tax advice. Based pilotís springs to mind.
I don't know, because I'm not in that position, however, what I do know is that the tax returns show the cash element of a loan as being classed as income spread over the 72 month period.
Again, second hand info, but my source was asked to sign the new contract, the reasoning given was so that you're only liable to be taxed on the cash.
Will this guy (AE) get a shock when he gets his 6th tax bill for the 550k non-cash element? Well, apparently not; it isn't shown anywhere on your payroll, hasn't passed through your account, and consequently isn't reported income when CX send off their gubbins to the IRD in April.
Conjecture, but thats how I see it, and how it has been explained to them (I appreciate your point re. taxation advice), caveat emptor as always.
Itís irrelevant what the company is reporting to the IRD. The company has already been down this road when they didnít report the income to the IRD of all the based pilots. Look where that got them and the based pilots that took their advice? I can assure you that if itís the companyís position that an iCadet must repay the entire HK$1.2m if they resign the day after they check to line, the company has just opened up a can of worms for themselves and a whole world of pain for the unwitting kids that are signing up to this. As an accountant in my previous life, the whole forgivable loan issue is likely to come back and bite the company on the back side. The way it has been managed is like watching an episode of Faulty Towers.
The way tax works here is the HKIRD want a years worth of your tax in their pocket so your first year in HKG you have to pay the current tax you owe + next years tax they think you will owe. The second year in HKG they already have the tax they thought you would pay for that year which is usually not enough so you pay the remainder of the tax for the second year plus what they now think you will owe for the 3rd year based on your 2nd year tax.
Basically the 1st year you pay tax for 2 years and then it is about 15% a year after that.
We all spend a lot of time in HKG, you don't need to convert to US$ to help us understand the value of the HK$.
In response to crwjerks "one size fits all and let me put you all off" budgetary requirements, let me add a more realistic view.
Apart from the socializing and the food, everything else he has priced can be halved, maid not needed.
In terms of tax- very loose and inaccurate figures here- as usual from the naysayers. If you go onto the hong kong tax calculator and type in 552'000 hkd you will find that you are not paying anywhere close to 15% tax for the year.
In the spirit of prune ( where anyone can win an argument based on THEIR own figures) let me add some interesting comparisons.
The starting salary including monthly allowances is an easy 50'000 HKD per month. This is equal to £3950pm or $6400pm.
Let us use sterling for some comparisons. In uk we can use 30% tax made up of 20% income tax and 11% national insurance. Therefore you will be earning the equivalent of £4500 pm or £54510 per annum- first year salary.
This is frankly not bad- if we can for one split second play devils advocate and understand Cathay have no reason to recompense us for the fact that HK " can be expensive" then you ain't doing to bad.
WARNING- my post is just a positive eye opener. There is one basic thing you need to remember: the package is not good enough for those with 1500 hours+, and purely a short term job for newbees.
1500 hours guys- you are worth more than CX and don't you forget it. Do not lower yourselves to this paltry insulting offer.
Newbees- best gig in town for the short term I.e 6 years. Get yourselves the rating, some right seat time (1 year is sufficient) , enjoy S.E Asia and staff travel then F**k off somewhere else.
betpump A little simplistic, but some valid points, especially about it being insulting to anyone with experience and secondly, about bring a stepping stone to much better things.
etops, as for me not knowing what I'm talking about, fyi I'm in my 3rd decade with CX. I'll defend my knowledge on the subject of this deal and the HKG taxation system. I'll guarantee I know more about HKG tax than the recruitment office (not difficult) and the mangers (sic) that devised this idiocy (again, not a difficult thing)
I'm not starting an argument with you, but I really think I'm in a much better position than you to pass comment.
The USD conversion I had on my post was for my benefit not yours. I realise a lot of guys on here have been in HK for many years but I have no idea what normal is in HKD so I have to convert it to a currency I know.
Betpump5 comments that everything apart from food and socializing can be halved sounds a bit more like it. I assume the rent is around right after a look on Squarefoot.
I am trying to get a realistic picture of cost of living in HK because there seems to be a lot of people on here claiming they have to eat packet noodles to survive due to the SO wage being so inadequate. I am starting to think this is either not really the case or some people have very poor budgeting skills.
Thanks for the help and if I do get a job with CX I will be leaving a fair chunk of the forgivable loan in the bank just in case the tax man does come knocking!
Laugh if you will, a night out on the turps will easily cost you 1000 bucks.
I'd like to think you are joking, if not you have a serious alcohol problem. HK$1,000 will buy you 30 or 40 units of alcohol in Lan Kwai Fong, more in Wanchai. That's a lot more than the safe limit for a week and you do that much in one night?