What is Tax Representative, Tax Agent & Tax Accountant

What is Tax Representative, Tax Agent & Tax Accountant?

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Taxation

The roles and functions as a tax agent and a tax representative differ across countries and different terms are used in every countries. Broadly speaking, tax representative acts as a client’s own company, while a tax agent represents itself. Yet, both work for client and may decide not to perform the duties required by the client.

Tax Representatives vs Tax Agents

There are also authorized tax agents under the “Tax Agency Scheme” in Mainland China who are operated in the prescribed scope of either commission from taxpayer or withholding agents and offer various tax services in the form of tax verification, compliance and advisory.

Tax agents are crucial cooperators to help setup a business in China, and make sure you maintain your business free from irregularities as well as legal risks.

Certain European countries, among them the Netherlands and Germany, impose a legal obligation on non-EU organisations that are selling goods and services to appoint a VAT fiscal representative or tax agent for taking care of the registration, filing and payment formalities in relation to VAT.

The name of this role is fiscal representative, and it is very high in demand for the emerging companies that engage in the new digital economy outside their countries.

Related Article: 2024 Tax Filing Season: Tax Deadline 2024 in Hong Kong You Need To Know About

What Services Does a Tax Representative Provide in Hong Kong?

The tax representative is defined under the Cap 112 of the Inland Revenue Ordinance in Hong Kong, which is defined as a person who has been assigned in writing by any other person to act on his behalf for different tax matters, such as tax filing.

The tax representative helps client to comply with the tax filing requirements and also conducts tax planning and advising so as to help on the tax system of the business. Tax representative normally provides a full range of tax services, including but not limited to:

  • As your tax representative, we will liaise with the IRD on your behalf.
  • Processing tax returns and filing the returns with the IRD.
  • Responding to any letter from the IRD and managing related emails and enquiries on your behalf.
  • Handling field audits and investigations from the IRD.
  • Seeking pre-clearance tax rulings from the IRD.
  • Applying for time extension and inquiry for filing tax returns from the IRD.
  • Objections lodging with the IRD on the evaluated tax assessments / estimated tax assessments.
  • Explaining your tax compliance status and tax situation.
  • Crafting tailor-made tax strategies to reduce your liabilities and attain some tax efficiencies.
  • Preparation of balance sheets, profit and loss accounts and profits tax computation for sole proprietorship and partnership businesses.

Tax Accountant Duty

Besides, there is one shared feature of tax representative and tax agent and it is the fact that they are usually tax accountants. Unlike a normal accountant who is more focused on the client’s complete financial status, a tax accountant only specialises in taxation and looks into the client’s tax matters only.

A tax accountant can be regarded as having the specific tax knowledge to help clients comply with the tax laws, for instance by helping clients to fill tax return forms, and to give tax planning advice to clients.

Why Appoint a Tax Accountant?

As the owner of a business you may want to devote more time to developing your business than in entering the accounting journals or the tax returns which an experienced professional firm is likely to do better and with more accuracy. Besides, a tax representative can be of great help when it comes to the drawing up of a carefully constructed tax advisory strategy so as to either mitigate or reduce your tax liabilities or achieve tax efficiency.

Moreover, under the Block Extension Scheme operated by Hong Kong Inland Revenue Department (“IRD”), a taxpayer having a registered tax representative will be granted extra time for the submission of his or her tax returns.

The timelines can expect a slight change every now and then, and the final date is only usually disclosed by the IRD annually.

One benefits when a tax representative is appointed is that taxes can be filed from around 7.5 months after the end of the accounting period. Moreover, in case if a “solo entrepreneur” runs the business, then there is additional one or four months more for filing a tax returns.

How FastLane Group can Help?

If you want to be relieved of the time-intensive tasks of administration and tax filing, you can appoint FastLane Group as your tax representative in Hong Kong to take care of all tax-related and legal compliance and commitments of your business.

Using our deep knowledge of the tax laws and regulations of Hong Kong, we can design a unique tax strategy that will help you reduce your tax liability and be in full compliance with all the laws and regulations. The benefit of this approach is that you not only save money but also get peace of mind knowing that your tax matters are in order. Contact us now.

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