Top reasons to open a Hong Kong company

Hong Kong is one of the world’s most important financial hubs, drawing a large number of investors to establish businesses here. Businesses are eager to set up shop in the country as a result of the government’s attempts to improve the economic climate. Here are some of the reasons why.

Many entrepreneurs opt to establish their businesses in Hong Kong to make it easier to enter a worldwide market and to take advantage of tax-friendly regulations. Hong Kong is regarded as one of the finest places to establish a business, since it excels in areas that are important to companies, such as:

• Strategic location
• Productive workforce
• A stable economic and political environment
• Attractive tax regime
• Pro-business environment
• World-class infrastructure
• Effective legal system

Hong Kong is ideally located at the Asian continent’s core. Most markets in the Asia-Pacific area are accessible through a five-to-eight-hour flight. If you need to get into the Mainland Chinese market, Hong Kong is conveniently located on the southeast coast of the mainland, bordering the Pearl River Delta’s mouth. This advantage allows for one-day travel between Hong Kong and Beijing, Shanghai, and other important Chinese cities.

Hong Kong is well-known for being a great place to start a business. In Hong Kong, you may start forming a business in as little as a week. The outstanding infrastructures and commercial spaces are readily available, according to the report. The protection of intellectual property is treated seriously, with strong rules in place. Businesses have access to a number of different dispute resolution options.

The city’s straightforward and business-friendly tax system is another factor attracting international investment. Hong Kong is regarded as one of the world’s lowest tax jurisdictions. For earnings over 120,000 HKD, personal income tax (also known as salary tax) ranges from 2% to 17%. Corporations pay 16.5 percent of their assessable profits (made inland) in corporate taxes, whereas unincorporated firms pay 15%. There are no capital gains taxes, no withholding taxes on profits and interest, and no social security payments are collected. In addition, Hong Kong has no sales tax or VAT.

The Hong Kong Special Administrative Region (HKSAR) is rated the freest economy in the Economic Freedom of the World 2020 Annual Report by the Fraser Institute. Hong Kong came out on top in all five categories (Size of Government, Legal System and Property Rights, Sound Money, Freedom to Trade Internationally, and Regulation).

Hong Kong now has a global reputation for its highly developed free-market economy, which is characterized by minimal taxes, almost unfettered port commerce, and a well-established international financial sector. To be more specific, there are NO:

• restrictions on inward and outward investments
• foreign exchange controls
• foreign ownership restrictions in Hong Kong.

Hong Kong’s status as a business-friendly location is bolstered by factors such as a stable banking system, practically no public debt, a robust legal system, large foreign exchange reserves, and a tough anti-corruption policy. As a result, many entrepreneurs choose to establish a business in Hong Kong in order to take full advantage of the world’s most liberal economy.

The Hong Kong government and private sector have created a number of initiatives to assist both local and international firms in growing and improving at every stage of their growth such as:

• Many business support programs and financial incentives to foster the growth of SMEs have been established. These programs assist Hong Kong’s small and medium businesses (SMEs) in obtaining finance for business installations and equipment, as well as fulfilling working capital requirements; expanding foreign markets; and improving overall competitiveness.

For the convenience of businesses, all of the financing programs are updated on Hong Kong government websites:

A Supportive Government | InvestHK

Government Funding Schemes at a Glance

Hong Kong has all along adopted an open immigration policy. Visa-free trips to Hong Kong are permitted for nationals of about 170 countries and territories for durations ranging from 7 to 180 days.

In Hong Kong, professionals and entrepreneurs are welcome to start a business and invest. Under the General Employment Policy, overseas professionals with valuable skills, expertise, or experience that are not easily accessible in Hong Kong, or who are in a position to make significant contributions to the economy, may apply to work here (General Employment Policy (GEP) 

Short-term travelers with a visiting visa or entrance permission can conduct business talks and execute contracts in Hong Kong. The government has put in place suitable work visa regulations to meet the demands of business owners who may desire to relocate to Hong Kong for company formation or recruit foreign specialists to work for them.
There are numerous policies and plans in place for international professionals, Mainland talents and professionals, and those looking to invest.

The legal system of Hong Kong is distinct from that of mainland China, and English common law prevails. Hong Kong has been a significant hub for arbitration in Asia since the creation of the International Arbitration Centre in 1985, and arbitration is now a common means of dispute settlement in Hong Kong.

Patents, copyrights, trademarks, and registered designs are all protected under the law, which includes rigorous rules for patents, copyrights, trademarks, and registered designs.

In addition, Hong Kong has established an Intellectual Property Department to oversee the IP system in the city, and this department is said to have significant expertise in dealing with IP issues. Trade and commerce, employment, taxation, and other business-related fields all have their own set of laws and regulations, making it an appealing environment to start and run a firm.

Most firms choose Hong Kong to establish a corporation because it is thought to be politically stable, with pro-business governance and free-market principles. It is also regarded as one of the world’s least corrupt economies. Hong Kong has even established an anti-corruption body, the Independent Commission Against Corruption (ICAC), whose goal is to combat corruption in both the public and private sectors.

Hong Kong has a workforce that is well-trained, educated, and competent. The workforce is made up of a local talent pool of experienced and entrepreneurial individuals who are well-versed in the fast-growing Mainland cities’ business culture.

Hong Kongers are typically thought to be hardworking, competitive, and always looking for ways to improve. Despite the fact that English is the primary language of business, the majority of the workforce speaks Cantonese and Mandarin as a result of the country’s ties to China.

Hong Kong has taken several steps to enhance its infrastructure in order to satisfy the increasing demands of companies. It is reputed to have one of the world’s best airports and busiest ports. All main centers are connected by transportation options that are both efficient and affordable.

Cyberport and the Hong Kong Science and Technology Parks are two world-class industrial/business parks in Hong Kong. These parks provide integrated infrastructure in one location, lowering per-business costs while also allowing businesses to function in a highly favorable, environmentally friendly environment.

Hong Kong has one of the most technologically advanced telecommunications infrastructures in the world. Almost all commercial and residential buildings have access to high-speed internet. Thanks to Hong Kong’s open marketplaces, there are several competing mobile phone and Internet service providers. In Hong Kong, almost 98 percent of homes have access to high-speed Internet.

The vast majority of international professionals and entrepreneurs who establish a firm in Hong Kong do so with their families. Hong Kong is well-known for its high standard of living. Hong Kong’s public transit system is well-connected, clean, safe, efficient, and, most importantly, inexpensive. With its extensive network of buses, trains, ferries, and taxis, getting around Hong Kong is simple.

Hong Kong is home to numerous foreign schools that follow the same curriculum as their home countries and provide world-class private and public health services as well as skilled medical practitioners.

Cleanliness, efficiency, safety, and affordability characterize the healthcare environment. There are several leisure activities to partake in, and Hong Kong is known as the “city that never sleeps” because of its bustling and entertaining nightlife.