Salaries Tax (Professional Tax) is imposed on working income from employment or self-employment. Work income refers to all regular or occasional, fixed or additional remunerations, regardless of the form (money or tangible item), source, location, calculation and payment method or currency.
Working income includes income such as wage, daily salary, rewards, hiring fee, fee for presence, gratuity, bonus, commission, brokerages, shares or profits or any other similar kind.
Taxpayers subject to Salaries Tax (Professional Tax) are classified into two groups:
Group 1: Employees (those employed to render services to third parties in return for compensation on daily or monthly basis). In the case of employees, professional tax is deductible at source and the tax deducted by the employer must be paid to the tax department on a quarterly basis within the prescribed period.
Group 2: Self-employed (This group is composed of those self-employed professionals.) For Self-employed, the tax is based on the net profit of the previous year.
Salaries Tax (Professional Tax) is computed at progressive rates from 7% to 12%.
Declaration and Payments:
Group 1: Employees
Employers are required to file Form M2 with the Finance Department within 15 days after commencement of employment. Employers are required to file any changes with the personal details of employees with the Finance Department within 15 days the changes become effective.
Employers are required to deduct professional taxes from their employees’ salary incomes on a “pay-as-you-earn” basis, and remit these deductions to the tax authorities on a quarterly or monthly basis. Non-residents are required to pay tax on a monthly basis.
Group 2: Self-employed
Self-employed who work together with not less than four other professional practitioners or have an average turnover over the last three years of more than MOP1,000,000 are obliged to submit annually, before 15 April, Professional Tax returns in respect of the preceding year. The tax returns should be certified by Certified Accountant or Certified Public Accountant who are registered with the Macao Professional Committee of Accountants.
Other Self-employed are obliged to submit annually, between January and February, professional tax returns in respect of the preceding year. Certification of the tax returns by Certified Accountant or Certified Public Accountant is not required in these cases.
Reference:
Law Nº 2/78/M：Salaries tax (Professional Tax)
Macao SAR Government- Printing Bureau (Official Website): https://bo.io.gov.mo/bo/i/78/08/lei02_cn.asp