Are you thinking of going worldwide with your business? Nothing can be better than an offshore company for that purpose as it gives new opportunities, various benefits, and is a good diversification step as you will have assets to rely on if something happens in your home country.
Hong Kong is not a typical offshore island that has nothing but palm-fringed beaches for tourists and company registration services for entrepreneurs. However, the conditions it offers for business are nearly just as good as those you can expect in well-known tax havens, while the reputation of your business will be higher.
If you are not an expert in the offshore world, we invite you to our portal where you will find loads of information on the topic before you focus on opening an offshore in Hong Kong. We offer a team of seasoned consultants that will help you quickly launch your company (and also open a current account abroad, obtain second citizenship for the whole family, or invest in foreign real estate).
Why Hong Kong?
Typical offshore jurisdictions, like the BVI or Nevis, do have their advantages. Why should you prefer Hong Kong? This is a question that we answer on a case-by-case basis. The choice of a destination will depend on the activity you are going to engage in, the location of your counterparties, your citizenship, prospects of company development, and many other factors.
A typical offshore may bring certain problems with opening a corporate account, making payments (the transaction may be frozen), and difficulties in working on international markets. Moreover, the jurisdiction may be suddenly blacklisted, and you will have to face the consequences. These are the risks that are sometimes outweighed by the pros of offshores, of course. Hong Kong may require more costs, but you will not encounter these drawbacks.
Weigh all the advantages and disadvantages to make a decision – or request a consultant’s help on our portal.
Here are the obvious pros of Hong Kong as a midshore jurisdiction:
- Your company will not be formally registered in an offshore jurisdiction, and still you will take advantage of many features typical of tax havens
- An offshore entity incorporated in Hong Kong is a short bridge to Chinese markets
- The city provides legitimate opportunities to optimize your taxes
- Hong Kong is a major financial hub with excellent banking services
- The jurisdiction takes every effort to simplify conducting real business and support entrepreneurs
- Hong Kong has a very high reputation in the business world, and your company may have its share of all the related benefits
- Benefit from well-developed infrastructure
- The taxes are imposed on a territorial principle, and it means that you will not have to pay any taxes in Hong Kong if your profits are derived elsewhere
- You can own foreign property without any restrictions
As you see, Hong Kong has a lot to propose, and it may be a perfect jurisdiction for you if it is in line with your priorities. Do not hesitate to ask any questions to our experts by following the link above.
Hong Kong Company: Basic Requirements
Let’s look at some peculiarities of company formation in Hong Kong:
- Name. Think of several options as the name should be unique and it may turn out that the best variant is unavailable. Make sure your name does not violate any intellectual property rights.
- Shareholders. The number may vary between 1 and 50 persons, and these can be residents of any state, natural persons or legal entities. The general meetings can be held at any place in the world, and the company director can be a shareholder at the same time.
- Director. You will need at least one director, an individual or a legal entity. A natural person that occupies this position should be no less than 18 years old and have no previous criminal record.
- Secretary. This is an obligatory position that could be occupied by an individual or a legal entity as well. If this is an individual, he/she should be a permanent resident of Hong Kong. If this is a legal entity, it is required to possess a registered office in Hong Kong. The person holding this position cannot be a director or a shareholder at the same time.
- Registered office. This is an obligatory requirement for a company formed in Hong Kong: you will need to rent a physical office, and you are not allowed to just have a mailbox to be a properly established company.
- Taxation. You will have to pay 16.5% of corporate tax, but different benefits and subtractions can make this figure much smaller. Hong Kong has territorial taxation – as a result, you will not be liable for any taxes with regard to the profits generated outside the region. You are free from VAT or capital gains tax.
- Share capital. No minimum requirements are imposed, so you can start your company with 1 shareholder that possesses just 1 ordinary share (bearer shares are prohibited). You can use any currency to denominate your share capital, and shares can be transferred free of charge (stamp duty is payable, however).
- Information disclosure. As soon as your company has been registered, you will have to submit the relevant information to the register of companies. You can use the services of nominees if you want to as this is officially permitted. A Significant Controllers Register may be required to be filed in some instances.
- Compliance procedures. Companies are obliged to keep financial reports and have them readily available. If they are executed by an internal accountant, a review by a third-party specialist in Hong Kong is mandatory.
- Business Registration Certificate. This document has to be renewed no later than 30 days prior to expiration (on an annual or three-year basis).
If you are a foreigner:
- You are not required to be physically present to set up your business in Hong Kong.
- You will later be able to run your company online.
- You can be a sole director or a shareholder.
Do you still have any questions or doubts? Visit our portal by clicking on the above link to obtain much more information and get in touch with our experts who will do their best to provide a smooth company registration process to you!