housing alowance cathay
 

hi
I am trying to get some info about the housing allowance.
I read its 3000 us dol the first 2 years and goes to 6000 after that.
It can be paid towards rent or mortgage.
if i buy a house and i pay it off in 5 years, do I still receive the allowance if i buy another house?

thanks

Yes you can, however, you must actually live in the apartment you claim the allowance for. In practice people pay down the mortgage to the point that the rent will cover all the expenses and then move out and do it all again.

When you have 4 houses, you can buy a hotel :)

property tax, government rate, management fees
 

Sidetrack the topic a little bit... what are the various homeowner expenses in HK? I've read conflicting information on whether owner-occupied housing pays property tax (since its based on "rental income")? What about government rate and management fees. I'm looking at maybe 750 sq ft (2 bedroom) in Discovery Bay for approximately 1.75 mil - 2mil. HKD.

As an owner you will need to pay:
Government Rates and Rent (maybe $2500/qtr)
Management fees ($1.6/sqft/month in DB)
Income tax on the allowance (max 16.5%)

All of this will need to come out of your salary, as the housing allowance can only be used to cover the mortgage costs.

You can set your mortgage payment to the housing allowance ceiling, and lock it in for 2 years. On the size of apartment you mention, it will pay off super-fast.:D

It is a bit of a sore point that CX PNL insist to the IRD that the housing allowance is a cash allowance, so is considered as taxable income, even though it is not strictly speaking cash - as you must spend it on mortgage/loan repayments. Many owner-occupiers have questioned this in the past with the IRD but CX PNL insist it is cash.:ugh:

I think there is mileage to push this matter further, but I am reluctant to bite the hand that feeds me.:rolleyes:

Just remember before you jump in boots and all that you will have to come up with a deposit. In our case it was about $600,000HKD. Not exactly pocket change! We did alright on our house but we bought during SARS. Today it is a gamble. For Gods sake don't buy straight a way. Find out whether you are going to be able to hack HK first. Trust me it ain't for everyone. The last thing you want is to be a Swire prostitute, with NR as your pimp!

Thanks
 

Thanks for the informative reply, Busbert. I think I would wait about 6 months to settle through training and make sure all is working out before I would buy. But, I'de have to get the job first...

Thanks for the info guys.

How about if you are based in europe or the usa?

You are on your own to finance any accommodation