Easy Guide To Set Up A Company In Hong Kong
Simple guide to help start your business in Hong Kong
Being one of the most competitive cities in the world, Hong Kong is the ideal location for setting up businesses. Having a company in Hong Kong has several benefits:Low tax rate
Hong Kong has a very low tax rate which is beneficial to building up your business.Strategic Location
Hong Kong is located near many well developed cities such as Singapore and Tokyo. Mainland China’s large market is also just one step away. This allows for many opportunities outside of Hong Kong.
Hong Kong’s business related laws are well-established and transparent. This creates a great business environment.
Things to notice before incorporating a new company
1. Propose company name
The company name can be in Chinese or English. It should be unique and should not allow people to associate it with governmental organizations.
2. Record business details
Record the nature and location of the business.
3. Register business address
Register a valid business address (excluding P.O box).
4. Appoint director
The director of the business can be anyone with any nationality. However, the director must be over 18 years of age.
5. Fill in shareholder details
A company incorporated in Hong Kong must have at least one shareholder. Full name and residential address should be provided. In the case that the shareholder is a company entity, the registered company name and company address should be provided.
6. Details of share capital structure
Class and number of shares, share capital to be subscribed and the amount to be paid up/remain unpaid should be declared.
7. Appoint company secretary
A Hong Kong resident should be hired as the company’s secretary. Companies hosting company services such as Link-proCPA can also be hired to act as the company’s secretary.
8. Forms and Documents
NNC1 form for company limited by share, or NNC1G form for company limited by guarantee
9. The company’s Articles of Association
Notice to the business registration office (IRBR1) – Must select whether a 3-year certificate is needed.
1. Decide on Company type
Different company types are available for different business purposes. The most common setup is Private company limited by shares. The company will be registered and incorporated in Hong Kong and can enjoy all tax benefits and concessions available to any business. The company is also a separate legal entity from its owners.
2. Decide on company name
The company name should be distinct from the registered company names in the index of Companies Registry and should reflect the business nature. All Hong Kong company names must end with limited. The company name is not limited to Chinese or English.
3. Decide on company management and governance
A Private Limited company requires the following:
Director: The director of the company can be a natural person of any nationality. A corporation can also act as a company’s director.
Company secretary: At least one Hong Kong resident or one Company that can provide company secretary service.
Designated representative: At least one person who is a shareholder, director or employee of the company and also a natural person resident in Hong Kong. Alternatively, the company can request an accounting professional, a legal professional, or a person licensed to carry on a business as a company service provider to be the designated representative of the company.
Business address: An office location that is in Hong Kong.
4. Determine the company share capital and ownership
There must be at least one shareholder, who can be a natural person or a corporation. Shareholders holding more than 25% or shares are considered a significant controller. Significant controller details have to be registered into the Significant Controllers registry and may be inspected by law enforcement officers upon demand.
Shares represent the contribution of funds from shareholders to the company. It can be in any currency and any amount. For starters, it can start with a nominal amount of HKD $1. Increasing share capital is allowed to be done anytime.
5. Determine financial year end
Companies in Hong Kong have to decide on their financial year end and prepare financial statements for that predefined period. The Hong Kong government fiscal year end is 31 March, such that, for most companies in Hong Kong, the financial year end period either follows the Hong Kong government fiscal year end, or ends 31 December or on 30 June.