Register company in Hong Kong

Peculiarities and procedure of registration of company in Hong Kong

Hong Kong is the world's first administrative region by the number of registered offshore businesses. The financial center of China is attractive for business as well because it is not offshore in the territory of our state, i.e. it is not included in the list of offshore zones. However, before company registration Hong Kong, you should consider that:

  • The territorial principle of taxation applies here.
  • The issue of opening accounts should be carefully thought over.

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How to register a company in Hong Kong: Documents and terms

To open a company in Hong Kong, you should prepare:

  • Copies of documents: internal passport, foreign passport with confirmation of the address of representatives — shareholder, beneficiary, or director. The papers must be certified by a notary and translated into English.
  • Personal information: contacts, e-mail.
  • Scanned copies of all documents if the shareholder is a legal entity. Additionally provided copies of Incumbency Certificate (up to 3-4 months), passports of executives and shareholders with proof of place of residence.
  • If the shareholder is a nominee, trust declarations are prepared.
  • A description of the company's activities, detailing the sources of funds used by the beneficiary, which will be used for business activities.
  • A signed registration form and company name.

The time it may take to incorporate companies in Hong Kong depends on the form chosen:

  • Ready-made company Hong Kong registration takes up to 5 working days.
  • Registering a business in Hong Kong to order — from 4 weeks, depending on the chosen structure.

Taxation after company registration Hong Kong

Hong Kong company registration is attractive because here, the business is not subject to taxation if it does not make a profit from this administrative region. If a company is not physically present in Hong Kong and is only registered, it is considered offshore.

A registered company in Hong Kong is obliged to pay:

  • Annual tax — 320 USD
  • A fee to the budget — 65 USD

If the company opens a bank account in Hong Kong, it is automatically considered a resident, i. e. a legal entity liable to pay taxes. There is a two-tier progressive tax scale:

  • The first profit of HKD 2 million is taxed at 8.25%.
  • Profits over HKD 2 million are taxed at 16.5%.

In any case, if company incorporation in Hong Kong is successful, the local tax office makes the final decision on the form of taxation, which acts based on the company report.

There are several recommendations on how to successfully avoid taxation:

  • Do not specify Hong Kong as the place of execution or conclusion of contracts.
  • Realize business purposes in such a way that Hong Kong is not recognized as a place of business.
  • Do not open accounts with Hong Kong banks.

Company registration Hong Kong: Confidentiality and types of business activities

The most common are Limited Liability Companies or Private Company Limited by Shares.

When planning to register a company in Hong Kong, keep in mind that the main information about the organization is openly published in the relevant registry. In addition, as of 2018, any company is required to keep a register of beneficiaries and have a Designated Representative (DR) responsible for:

  • Preparing, maintaining, and updating background information.
  • Organizing feedback with the Hong Kong state authorities.

Financial reporting after incorporating a company in Hong Kong

In Hong Kong, there are strict rules concerning the keeping of financial records. All information generated must be kept for at least 7 years, a declaration must be filed every year, and the following documents must be provided:

  • Copies of receipts and bank statements
  • Invoices
  • Agreements with any partners, as well as other primary accounting documents

How to open a bank account when registering a business in Hong Kong

To get an exemption from paying taxes in Hong Kong, you should open an account outside of its territory. You can open an account in banks in European or Island countries.

Another option is to register an account with a payment system, which is easier and quicker.

Formation of company in Hong Kong: Cost

For those who are planning to set up a company in Hong Kong, the cost of the service is one of the decisive factors in this endeavor. By contacting our specialists, you will get a detailed plan of company registration Hong Kong, taking into account:

  • Company structure
  • Residence of the founders (director, shareholder)
  • Certification of documents
  • Individual requirements

Remember that the legislation of Hong Kong is periodically amended, and the working procedures of the banks, legal entities, and other subjects involved in the implementation of your goal change from time to time.

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