If a taxpayer maintains his parent, he can claim the allowance.
To qualify the allowance, the parent must ordinarily reside in Hong Kong and be 60 or above; or if under 60, he is disabled. From 2005/06 onward, the age limit is reduced to 55.
According to Section 2 of IRO, “parent” means:
1. a parent of whose marriage the taxpayer or his spouse is the child;
2. the natural father or mother of the taxpayer or his spouse;
3. a parent by whom the taxpayer or his spouse was adopted;
4. a stepparent of the taxpayer or his spouse; or
5. a parent of his deceased spouse.
Maintaining the parent means paying the parent at least $12,000 during the year of assessment or living with the parent “not for full consideration” for at least 6 months. The phrase “not for full consideration” means the taxpayer subsidizing the living costs of the parent; the allowance can still be granted even if the parent contributes to pay his own living expenses or some of the household expenditure.
In addition, a person may claim Additional Dependent Parent Allowance if he lives with his parent “not for full consideration” throughout the whole year of assessment.
Full allowance is granted for the whole year of assessment in which the parent or grandparent reaches 55. Also, full allowance is granted for the year of death. No time apportionment of the allowance is required.
No double dependent parent allowance for the same parent is allowed. If two or more persons claiming the allowance, they should reach an agreement as to who can get the allowance. If no such agreement is made, no one can get the allowance.
In addition, a person may claim Disabled Dependent Allowance in respect of his disabled parent. The condition for the claim is that the parent must be eligible to claim Disability Allowance from the Social Welfare Department.
A person may claim the allowance in tax return. If he forgets to do so, he may claim it by an objection when he receives the assessment. Even if he misses the objection deadline, he can still claim it by a Section 70A claim (because it is an omission — to claim the allowance).