Hong Kong located at the south-east of China, a former British colony, is now a part of the Republic of China. It became a part of China in 1997. Hong Kong has long been a favored destination for international businesses. Hong Kong has its own republic system separate from that of China. Hong Kong has followed in the tradition of the British system in its legal affairs. It has two official languages being Chinese and English.
Hong Kong has simplified legislation that makes incorporation of easier. It has a single process for both onshore and offshore companies. A key feature is that companies that do not have sources of income in Hong Kong do not have to pay taxes. This facility is useful for offshore companies. Hong Kong has a robust regulatory framework and excellent infrastructure that makes it an excellent destination for starting a business.
World’s financial companies have their regional headquarters in Hong Kong. The country follows one of the most business-friendly policies in the world as indicated by the Economic Freedom index. The jurisdiction of Hong Kong invites businesses to set up their offices.
There are various advantages of incorporating a company in Hong Kong. They include:
- Hong Kong has free trade agreements with various countries. Incorporating a company in Hong
- Kong is considered to be legitimate and not recognized as a vehicle for tax avoidance
- Since English is the official language, foreign businesses can experience a hassle-free process.
- Reporting of financial information can be done in English
- The registration process in Hong Kong is straightforward. It can be easily understood
- Foreigners can act as shareholders in a Hong Kong company. There is no restriction as in other countries.
- Incorporation of the company can be done within days
- Share capital investment is not required
- For setting up a limited liability company, only one shareholder and director is enough
- Hong Kong does not have capital gains tax
- There is no tax on dividends, interest, and royalty
- There are no taxes on foreign dividends
- Trade profits from foreign sources are not taxed in Hong Kong territory
- Subject to certain conditions, a tax credit is available for foreign tax paid by companies
- Net worth tax is not present in Hong Kong
- The communication systems and the banking infrastructure available in Hong Kong are world class
How to register a company in Hong Kong
If you are not planning to stay in Hong Kong, you need to open a limited company. The company needs to have a secretary and an office based in Hong Kong for registration. This can be done with the help of agencies that can provide this service at 5000 HKD per year. This option is affordable for many new companies. Hong Kong government allows for e-registration hence you don’t need to travel there to open the company. You can avail the services of a reputable agency who can coordinate all activities by mail or phone call or by clicking www.onlinecompanyregister.com.
First of all, you need to select a name for your company and an agency to help you with the process. The agency then checks whether the name you have chosen is available. You need to send your passport, proof of residential address such as drivers license copy and information about your company’s shareholders, nature of the business, etc. for a simple company structure, e-registration can be used for setting up the license. This process takes less than two hours to get the certification of incorporation. The business registration certificate is available once the passport is verified.
For companies with few layers, original documents of incorporation form (NNC1 form) needs to be signed by all the shareholders and sent to the licensed agency by courier. The total cost of incorporating a company can come up to 12,000 HKD. Some agencies offer discounts in the range of 3000 HKD. There will be maintenance fees of 7800 HKD per year for maintaining the company.
With the help of an honest agency, it is possible to incorporate a company in a hassle-free process. It is necessary to verify the credentials of the agency before paying them. The best way to get referrals from friends who might have incorporated a company.