Company Formation Comparison: Hong Kong vs Australia

Updated on Sunday 30th April 2017

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Hong Kong is an international business and financial center in Southeast Asia while Australia is a country rich in natural resources, that has good infrastructure. Although both countries offer various options for investment and a choice between multiple business entities, investors should be aware that several taxation differences apply.

Company formation in Hong Kong can be compared to that in Australia in terms of taxation and the easiness for investments.

Opening a company in Australia

In order to be able to do business in Australia, foreigners are required to obtain a Business Innovation and Investment Visa. The time required to open a company in Australia will depend on the chosen business form and so will the initial business start-up costs.

The corporate income tax rate in Australia is 30% and a lower rate of 28.5% applied to companies that have an aggregate annual turnover below 2 million AUD. A value-added tax applies on the outputs and inputs of a company’s activities. Its rate is 10% and mandatory registration for the Goods and Services Tax is applicable.

Opening a company in Hong Kong

Hong Kong has a welcoming business climate and a very competitive tax regime. There are no withholding taxes on dividends and the corporate income tax rate is 16.5% with a lower rate for unincorporated businesses. Company formation in Hong Kong is accomplished in a few steps and businesses can commence their activities in a matter of days, if the documents are properly submitted and all the licenses are obtained.

Hong Kong offers a good location in Southeast Asia. Those who choose to open a Hong Kong company can afterward expand to other ASEAN countries. Another advantage is that the city is closely located to Mainland China, at the same time remaining autonomous in terms of its business regime and law for foreign investments.

The two locations offer access to different markets and present varied business opportunities.

Investors who want to know more about the requirements for investment in the Special Administrative Region can contact our Hong Kong company formation experts.

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Company Formation Comparison: Hong Kong vs Australia

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