Germany and Hong Kong are two important business destinations for investors worldwide. They both provide location advantages, one in Europe and the other in Asia and they are strategically positioned to allow for the existence of many types of business opportunities.
If you are interested in company registration in Hong Kong
our experts highlight the main differences regarding company formation, taxation, and management between these two business locations.
Company formation in Germany
Both Germany and Hong Kong allow for several types of companies which may be incorporated at the investors’ discretion and per his business needs. In Germany, a popular business form is the GmbH which is a private limited liability company, the equivalent of the LLC in Hong Kong. Large German businesses are incorporated in the form is a joint stock company.
A difference in company formation exists in respect to taxation and the number of days needed to set-up a new company. In Germany, the company formation will usually last around 10 or 11 days while company registration in Hong Kong is faster.
The corporate income tax in Hong Kong
is lower compared to that in Germany which has a low base value but is subject to a number of surcharges that bring it to an effective value of 30 to 33%.
Company formation in Hong Kong
The Hong Kong company formation process
is a very straightforward one which can be accomplished in about two workdays when all of the company’s constitutive documents are in order. After registration, the company will also need to obtain special permits and licenses for functioning but this is also a quick step as the investors can apply for many of these licenses via online portals.
Hong Kong has a low taxation regime
compared to Germany, having a corporate income tax of 16.5% and a lower one for unincorporated businesses. The city does not impose withholding taxes on dividends and has signed a number of double tax treaties. German companies can benefit from the advantages of these agreements if they open a branch in Hong Kong.
Foreign investors who choose to open a Hong Kong company will find that they benefit from a good location in Asia and a welcoming business environment, including one that is bilingual (both Chinese and English are recognized languages).