Hong Kong is the investors’ paradise: a powerhouse tested and proven to act as firing canon for businesses that want to snowball in Asia and globally. It is a global financial hub run by a pro-business administration that is willing to do anything to see every business succeed. In the last World Bank’s ease of doing business Index, Hong Kong shot to the third position.
Benefits of Business Registration in Hong Kong
Before we can tell you the steps needed for business registration in Hong Kong, it is vital to start by understanding the core benefits. Here are some of them:
- Hong Kong, together with Singapore, has made a name for being the most liberal jurisdiction in the globe. With this fact, business registration in Hong Kong is simple, fast, cheap, and convenient.
- You can run your company incorporated in Hong Kong from anywhere in the globe. Using an agency, your business will be able to operate professionally on a daily basis and grow progressively. Well, if you get experts to run the company, it will grow even faster to become the multinational you always dream of.
- One of the core targets of any business is having a ready market for its products. So how do you like a market of 1.3 billion people for your product? That is what Hong Kong has to offer. It acts as the best gateway to Mainland China that opens a market of 1.3 billion people. And that is not all. Once you are through with business registration in Hong Kong, your enterprise will also enjoy preferential treatment from more than 30 states that have signed bilateral trade agreements with Hong Kong.
- Although Hong Kong is a province of the Democratic Republic of China, it enjoys huge autonomy that includes running an independent administration. Since the island lacks land for agriculture or mineral exploration, it has adopted a unique business-based model. The administration does everything possible, from simplifying the tax system to running business incubation programs, to ensure your enterprise succeeds after business registration in Hong Kong.
We can go on and on; these are only a few pros that you will enjoy after business registration in Hong Kong. Now, we will tell you how to incorporate a private limited liability company.
Useful Facts about Business Registration in Hong Kong
In Hong Kong, company incorporation is guided by the Companies Ordinance of Hong Kong. This article provides full details about registering a company in the Special Administration Region (SAR) of China. These details include the requirements for business registration in Hong Kong, post-incorporation requirements, and other details. With that said, here are some crucial facts that you need to know about company incorporation in Hong Kong.
Any Hong Kong private limited liability company is required to have at least one shareholder to a maximum of 50. No residency requirement is imposed on shareholders.
When registering a company in Hong Kong, the minimum number of directors needed is one. However, you can have as many as you want. The company needs to have at least one individual shareholder (no restrictions/requirements on nationality or residency).
Every limited liability company must have a company secretary who resides in Hong Kong. The secretary is required to maintain the company’s statutory books and records. He is also charged with the responsibility of ensuring the company is compliant with Hong Kong laws.
When you incorporate a company in Hong Kong, it has to meet its tax obligation. So what are these obligations? In 2017, Hong Kong introduced a two-tiered profit tax regime meant to make taxation simple and spur economic development. Under the two-tiered tax system, the profits tax rate for the first $2 million of the assessable profits is pushed down to 8.5%. Then, the profits tax for the assessable revenue above $2 million remains 16.5%. Note that Hong Kong uses the territorial basis of taxation, which implies that you will only pay the corporate tax on business done in Hong Kong.
Once you register a company in Hong Kong, you must prepare and maintain accounts properly. The company’s accounts have to be audited on an annual basis by a Certified Public Accountant in Hong Kong. Then, the audited accounts must be submitted to the Inland Revenue Department.
What Documents are required for Business Registration in Hong Kong?
When registering a business in Hong Kong, you need to prepare an assortment of documents and submit them to the registry. These documents are:
- Articles of Association for your company. These are documents that clearly specify a company’s operation regulations. For example, they show how different tasks such as handling of financial records and appointing directors in the company will be done.
- A duly filled company registration form that includes the following details.
- The name of your company.
- The company’s registered address.
- A description of the company’s activities.
- Details of the company’s directors, shareholders, and the resident company secretary.
- If your company has directors and shareholders who are non-residents, make sure to provide copies of their passports and proof of residence in their countries.
- In the case of local directors and shareholders, you need to provide copies of their identity cards.
- In the case of corporate shareholders, you need to provide a copy of the company registration for the parent company.
- Liabilities of the company directors.
- The share capital.
If the documents are provided in a different language other than English, you need to provide a translated document in English.