Tax at payment.

Taxable amount is amount of the cash payment.

Generally, yes, provided subsidiary bears the cost of award.

Income Tax:
No withholding required. Reporting required.

Social Insurance Contributions:
Employer and employee Mandatory Provident contributions apply, unless contribution ceiling already met. Employer must withhold employee contributions.

None.

None.

Awards paid in cash through local payroll generally have increased plan entitlement risks, as well as other increased labor law risks such as the need to include amount when calculating termination indemnities, obligation to consult works council, etc.

Discrimination against part-time employees is problematic if predominantly women.

ORSO legislation may treat cash awards as retirement scheme subject to registration/ exemption process if payment made upon termination of employment for certain reasons.

Need to comply with Hong Kong's Personal Data (Privacy) Ordinance which includes providing notice to employees and obtaining employee consent to collection, use and transfer of data.