Hong Kong is one of the leading international financial and trade centers, an important strategic gateway for investment and business. Therefore, a lot of foreign investors open companies in Hong Kong. In this article, we will outline the process of setting up a company in Hong Kong.
1. Things you should do to open a company in Hong Kong
A private limited liability company is the most common type of business entity registered in Hong Kong.
Limited liability companies have:
- A distinct legal personality;
- Limited liability for their owners;
- A positive public image, and a long-lasting structure.
Compared to other business arrangements such as sole proprietorships and partnerships, limited liability companies are better-suited to raise money and transfer ownership. Foreigners who wish to establish a limited liability company (LLC) or an offshore corporation in Hong Kong must examine the following:
- In Hong Kong, foreigners are allowed to be the sole directors and shareholders of a corporation.
- Foreigners who are anywhere in the world are able to run their Hong Kong offshore company. They can enter Hong Kong on a visitor visa whenever they like.
- Although physical presence is not necessary at the time of business registration, it may be required for the purpose of creating a bank account, depending on the bank chosen. Please contact Global Link Asia Consulting for more details.
- Managing Directors: A minimum of one individual director is required, with an unlimited number of directors permitted. The director must be a natural person of any country who can be a Hong Kong resident or anywhere in the world. Directors must be at least 18 years old and have never been bankrupt or convicted of fraud. It is not necessary for the directors to be stockholders. In addition to the individual Director, nominee Corporate Directors might be appointed. Directors Meetings of the board of directors can be held anywhere in the world.
- Owners of the company: A Hong Kong private limited corporation can have as few as one (1) shareholder and as many as fifty (50). A director and a shareholder may be the same person or maybe different people. The shareholder must be at least eighteen years old and of any country. A person or a corporation can be a shareholder.
- Company Secretary: It is necessary to appoint a company secretary. If it is an individual, the secretary must typically reside in Hong Kong; if it is a corporation, the secretary company must have a registered office or a place of business in Hong Kong. It is important to note that a solitary director/shareholder cannot also serve as the company secretary. The company secretary is in charge of keeping the business’s statutory books and records, as well as ensuring that the company complies with all statutory obligations.
- Although there is no minimum share capital requirement, firms registered in Hong Kong are required to have at least one shareholder and one ordinary share issued at the time of incorporation. The capitalization of a company can be indicated in any major currency and is not limited to the Hong Kong Dollar. Shares can be freely transferred, but a stamp duty cost must be paid. Bearer stocks are not permitted.
- Corporate tax (sometimes known as profits tax) is fixed at 16,5 percent of assessable profits for companies incorporated in Hong Kong. Hong Kong has a territorial tax system, which means that only profits earned in or derived from Hong Kong are taxed there. Hong Kong has no capital gains tax, dividend withholding tax, or GST/VAT.
- Continuous Compliance – Accounts must be prepared and maintained by businesses. In Hong Kong, accounts must be audited by Certified Public Accountants on a yearly basis. Annually, the audited accounts and tax return must be filed with the Inland Revenue Department.
2. Documents are necessary for Hong Kong company formation
The following documents are usually necessary to form a Hong Kong limited liability company:
- A copy of the company’s Articles of Association (Global Link Incorporation can help to provide this).
- A properly completed incorporation form that includes the following information (Global Link Incorporation will assist you to fill out):
- o Company name
o Registered address
o Brief description of business activities
o Particulars of shareholders, directors and company secretary
o Liability of members
o Share capital registered on incorporation
o Number of shares taken up by subscribers
- Non-resident shareholders and directors must provide a copy of their passport, proof of their overseas residential address, and a bank reference letter.
- Resident shareholders and directors Copy of Hong Kong must provide identity card and copy of residential address evidence.
- Corporate shareholders and directors must provide a copy of parent business registration documents, such as the Certificate of Incorporation and Articles of Association.
Note that any non-English documents must be accompanied by official certified translated copies.
3. Global Link Incorporation’s process to help you set up a company in Hong Kong
Global Link Incorporation will:
- Assess your business needs and provide a comprehensive business strategy for you before opening a company
- Review and prepare all required documents to register a company in Hong Kong
- Pay all required incorporation fees to the Hong Kong’s government
- Provide a registered office address for 01 (one) year
- Provide all corporate documents and a company stamp set
- Assist to open a bank account in Singapore (or an online bank account in the United States (“the US”). Please note that the application outcome depends on the bank’s assessment.
4. Business Support & Assistance
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:
SPECIAL: Free perks that come with this package:
- A free responsive website design for the newly incorporated company
- A free registered domain name (.com) for the first year (note: hosting fee is not included)
- 30-day FREE trial of QuickBooks Online – an international accounting solution for companies to track expenses, manage cash flow & create invoices better
- Consultation on international payment solutions such as PayPal, Stripe, etc.