Hong Kong Company Set Up




Hong Kong Companies Registration

Hong Kong(H.K.) is located in between Taiwan and China, therefore the earliest Cross-Strait trading is through Hong Kong. After 1997, Hong Kong was transferred back to China, became Special Administrative Region. HK Tax Rules came from British Common Law, therefore HK’s tax rules are adopted Duty-Free of Overseas Income. Normally, HK’s tax is Profits Tax which is 16.5%, it happens when you are having profits in HK, otherwise, you don't need to pay Profits tax. The standards of Profits Tax are very clearly, it depends on does your company is using HK resources if not, you have to avoid have a business connection with Local HK company.

Table of Contents

  • Introduction to Hong Kong
  • Relevant tax regulations
  • Advantages & Functions
  • Hong Kong company registration requirements
  • Notice for setting up a Hong Kong company



▎Introduction of Hong Kong  ▎

  • Hong Kong is one of the two special administrative regions of the People's Republic of China. It is located on the north bank of the South China Sea and the east side of the Pearl River Estuary. It is bordered by Shenzhen City, Guangdong Province to the north, and Macau and Zhuhai City, Guangdong Province are across the Pearl River to the west.
  • The other two sides are adjacent to the South China Sea. The entire territory of the Hong Kong Special Administrative Region is composed of Hong Kong Island, Kowloon, and the New Territories. Hong Kong Island is the core of Hong Kong’s development; geographically, it consists of mainland lands such as the Kowloon Peninsula and 263 islands, with a population of about 7.37 million.
  • Hong Kong's economy grew rapidly in the late 20th century, and gradually developed into a modern international metropolis and an international financial center with an important position in the Asia-Pacific region, dominated by industry and commerce, and is known as one of the four dragons in Asia. According to the Sino-British Joint Declaration, China has implemented the basic national policy of "One Country, Two Systems" in Hong Kong from July 1, 1997. Hong Kong is located between Taiwan and the mainland. Because it is located between the two sides of the strait, early cross-strait trade was conducted through Hong Kong.
  • After 1997, Hong Kong returned to China and became the Hong Kong Special Administrative Region. At present, most Taiwanese businessmen set up companies in Hong Kong, and the total number of companies registered in the Hong Kong company register in April 2018 has reached 10,434.
  • With many years of industrial and commercial experience, Inter Area can not only help customers to pay attention/services but also help them to establish and register companies and branches in Taiwan and open accounts.
  • Chinese investors investing in Taiwan can choose Inter Area because they have professional talents who are familiar with Taiwan's industrial, commercial affairs, set up procedures of Company in Hong Kong, and accompanied by a special person. Provided, designed to provide customers with the most complete, fast, and secure service. The focus is on the background and purpose of the customer's practical investment. Different products and services generate new experiences in determining future value.




▎Relevant tax regulations  ▎

After transferred back to China, the majority of offshore companies were chose set up in BVI and SAMOA. Why HK is a good option? Advantages as below:

  1. Suppliers and customers are not Hong Kong merchants;
  2. The signing process of the order is not in Hong Kong;
  3. The goods have not been declared, received, or shipped in Hong Kong;
  4. Registered Hong Kong company does not have a physical office in Hong Kong and employs Hong Kong employees;
  5. No business records have been kept in the Hong Kong Government.



▎Advantages & Functions  ▎

The advantages of Hong Kong company registration are described as follows:


Advantages Functions01  

1.The type of registration of a substantive company

Because Hong Kong company registration is not like a tax-free paradise such as BVI or
SAMOA, it is generally considered to be a PAPER COMPANY. It is necessary to change
the business registration certificate and submit an annual return every year.


Advantages Functions02  

2.Fresh image

As Hong Kong is an internationally renowned financial center, Hong Kong company       
registration is often used for brand management and international licensing.


Advantages Functions03  

3.Easy to authenticate

Hong Kong has multinational diplomatic embassies stationed, and it is easier and faster
to apply for international certification/investment certification.


Advantages Functions04  

4.Hong Kong exhibitors

Among the many taxes havens, only Hong Kong companies can register in Hong Kong 
to enjoy preferential treatment.


Advantages Functions05  

5.Import declaration

When goods need to be imported into Hong Kong for customs clearance, a business 
registration certificate is required, and a Hong Kong company has a business
registration certificate.


Advantages Functions06  

6.Opening a bank account

Registered companies in Hong Kong can open accounts directly at international
financial centers such as Hong Kong/Singapore and have high bank acceptance.          


Mainly positioned as a "holding" company. Example: The investment company used to invest in China/Vietnam/Taiwan is simple to set up and the company's document certification is relatively simple and fast, and the image of Hong Kong businessmen is better and can be applied for the purpose of applying for a trademark.



▎Hong Kong company registration requirements  ▎

  1. Registered Capital is HKD 10,000.
  2. Company’s English Name (Chinese if any).
  3. Must be a statutory secretary of a Hong Kong company.
  4. Set up a registered address.
  5. Minimum 1 Director/Shareholder Passport Copy.
  6. English Contact Address.



▎Regulation for setting up a Hong Kong company  ▎

  1. Hong Kong company naming rules:
    Registration of Hong Kong company name is free to choose, "company name" is allowed to contain regional and industrial nature, for example, China, Hong Kong, America, France, International... / Colleges, associations, groups, holdings Industry, investment, fund... etc., the English name must end in full. (Such as Limited, Group)
  2. Hong Kong company business scope:
    Hong Kong company has no special restrictions on the scope of business establishment. Any industry in Hong Kong can be our business scope, Hong Kong limited company can operate any business, except illegal business.
  3. Registered capital of Hong Kong company:
    The minimum registered capital of a Hong Kong company is HKD10,000, and the maximum is unlimited. The amount of capital does not need to be in place, but if the company’s equity is transferred or sold, a stamp duty of four-thousandths of the share capital is required.

Hong Kong tax law is derived from the common law of the United Kingdom, so it is the practice of exempting foreign income from taxation.
The basic tax for Hong Kong companies is 16.5% profit tax. Hong Kong adopts the principle of geographical origin for taxation, that is, only profits derived from Hong Kong are taxed in Hong Kong, and profits derived from other places are not subject to profits tax in Hong Kong.
In short, even if a limited company is established in Hong Kong, if the company's business profits are not derived from Hong Kong, the company can apply for "offshore income" to the Hong Kong Inland Revenue Department to be exempt from Hong Kong profits tax when reporting Hong Kong profits tax. Whether the profit is generated in Hong Kong or derived from Hong Kong is determined by the nature of the profit and the nature of the transaction that generated the profit. The general overseas tax exemption principles are as follows:

  • Neither the supplier nor the customer is a Hong Kong merchant;
  • The order signing process does not occur in Hong Kong;
  • The goods have not been declared, received or shipped in Hong Kong;
  • Do not have a physical office in Hong Kong and hire Hong Kong employees;
  • There are no operating records in the Hong Kong government.



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