Hong Kong is a city that has a lot of interesting business advantages for foreign investors who want to open a company. Its strategic location puts it close to Mainland China, a very important market, and also very close to another important market, the Asian one. Not only is Hong Kong located close to these important economic areas, but the city is highly connected to the rest of the world through its trade-friendly policies.
Investors can benefit from political stability and administrative transparency if they are interested in Hong Kong company formation. The company incorporation procedure is straightforward and there are many business options to consider.
Our Hong Kong company registration representatives invite you to watch a comprehensive video about opening a business in the city:
The Hong Kong company formation process
The first step for opening a business is choosing the appropriate business form. The Company Act in Hong Kong details the main types of companies available in the city, however, many investors interested in opening small and medium size enterprises choose to open a limited liability company because it is easy to set up and adaptable to many business fields.
Alternatively, foreign business owners can open a branch or a subsidiary in Hong Kong. The main difference between these two business forms suitable for multinational companies refers to the liability of the company and its dependence on the parent company outside of Hong Kong.
Companies in Hong Kong need to check the availability of their chosen name and then register at the Hong Kong Companies Registry and then at the Business Registration Office belonging to the Inland Revenue Department.
Our company formation agents in Hong Kong can help you with the company incorporation procedure so that your business will begin its activities in the shortest amount of time possible.
Business taxation in Hong Kong
Irrespective of the business field chosen for your company, you will benefit from a very attractive taxation regime. Moreover, Hong Kong also has an easy tax submission procedure and the city has a free trade port status, thus making export and import activities one of the top business choices in Hong Kong.
Companies incorporated in Hong Kong are taxed on their income produced in the city. The source of the profits is considered to be in Hong Kong if the main activities of the company take place in the city. When companies derive income both from a source that is located in Hong Kong and from a source outside the Special Administrative Region, then the expenses that can be attributed to the non-Hong Kong profit source are non-deductible. Those interested in company registration in Hong Kong can request specialized advice and tax consultancy.
The corporate income tax in Hong Kong has a rate of 16.5% and a lower rate of 15% for unincorporated businesses. There is no surtax or alternative minimum tax. Hong Kong does not impose withholding taxes on dividends or interest.
There are no special tax incentives for companies or targeted aid, however, the low tax regime and the duty-free status of the Special Administrative Region are attractive enough to determine foreign investors to open a business in Hong Kong.
Your business in Hong Kong
Hong Kong has almost no restrictions on foreign investment. Foreigners can hold 100% of the company, although in some fields like broadcasting foreign investors are conditioned to own no more than 49% of the company. Apart from the requirements for registration, as per the Companies Ordinance, there are no stringent or specific prior approval requirements for businesses. The basic law of Hong Kong allows for the free movement of capital, intangible assets, and goods.
Because it is an international business destination, Hong Kong is also home to an important pool of skilled staff. Professionals from other countries and professionals from China and Asia all have a strong work ethic and are multilingual. Hiring staff for your business in Hong Kong will not be an issue.
Call us now at + 852 8191 3385 to set up an appointment with our company formation experts in Hong Kong. As a DM Advisory client, you will benefit from the joint expertise of local lawyers and consultants for opening an offshore company in Hong Kong.
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