Hong Kong is an attractive market for investors and entrepreneurs from all over the world, with China and the Asia-Pacific region right on its doorstep.
The city consistently ranks as the world’s freest economy as an international economic centre with excellent technology infrastructure. The administration’s pro-business attitude, tax incentives for startups, a productive legal system, and world-class tech infrastructure have all contributed to this.
The first step in taking use of Hong Kong’s potential is to establish a company in Hong Kong. Continue reading to learn everything you need to know about business registration in Hong Kong.
Before we go into the requirements of business registration in Hong Kong, it’s crucial to understand the advantages of forming a company in the territory. These advantages are listed below:
It’s critical to choose the right company type when starting a business in Hong Kong. The following are the main business types:
The Companies Ordinance of Hong Kong can help anyone who want to register a business in Hong Kong. This is an official document that outlines the legal parameters within which businesses can operate in Hong Kong.
Here are some other facts concerning Hong Kong company registration that individuals and corporations should be aware of:
There must be at least one individual director, with no limitations or restrictions on the director’s location or country. The maximum number of directors is also uncapped.
In Hong Kong, a limited liability company must have at least one shareholder and a maximum of 50. Shareholders are not subject to any residence requirements.
In Hong Kong, there is no minimum share capital requirement for registration. With this in mind, the most frequent approach is to establish a company with HKD 10,000 share capital. Because one share in Hong Kong has a minimum paid-up capital of HKD 1.00, this capital is represented by 10,000 ordinary shares of HKD 1.00.
Hong Kong levies taxes on a territorial basis. That is, registered companies only pay corporate tax on Hong Kong-based transactions. Furthermore, there is no withholding tax on earnings and interest, nor is there any collection of tax on social security benefits, nor is there any VAT sales tax.
In Hong Kong, there are two alternatives for profit tax rates. The first is the Single-Tier Corporate Tax System, which levies a 16.5 percent tax on assessable profits on corporations and a 15% tax on unincorporated businesses. The second alternative is the Two-Tier Profits Tax Regime, which lowers the tax rate to 8.5 percent for the first $2 million in assessable profits for both companies and unincorporated businesses.
A company secretary who lives in Hong Kong is required for any limited liability company. A company secretary serves as a company’s representative in Hong Kong, ensuring that the firm’s operations are conducted in accordance with local regulations. A company secretary is also responsible for keeping the firm’s statutory books and records.
After a company has been officially registered in Hong Kong, the owners, directors, and company secretary are responsible for ensuring that accounts are properly prepared and maintained. In Hong Kong, accounts must be audited by a certified public accountant every year. Audited accounts must then be submitted to Hong Kong’s Inland Revenue Department.
Companies that want to use reliable payment gateway providers like Stripe and PayPal should normally use banks in the same territory. The following documents are necessary to open an account in Hong Kong:
Several documents must be prepared when registering a company in Hong Kong. These are outlined below:
These are a set of rules that govern how a board of directors can run a business. It’s often viewed as a contract between employees members of the company and the company.
A company registration form must also be completed with the following information:
If any documents are provided in a language other than English, an English-translated document must be provided as well.
For any company trying to join the Asia-Pacific market, Hong Kong is one of the most important investment destinations in the world. The region’s advantageous tax system, world-class financial and technological infrastructure, and ease of company formation all contribute to this.
It is possible to form a company in Hong Kong in a few of days. There are simple rules to follow, including the presence of at least one director, shareholder, and resident company secretary. A corporate bank account is also essential for businesses.
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