Hong Kong Incorporation
Company Incorporation in Hong Kong : an Overview
Hong Kong is one of the leading business markets in the world. Most global companies have their headquarters in Hong Kong and are flourishing. Company formation is easy and affordable in Hong Kong. A third party can readily register for company registration in Hong Kong without the owner or directors residing in Hong Kong. Any adult in Hong Kong who is older than 18 can start a business. Online Hong Kong company registration typically takes 5-7 working days.
What Types of Business Structures Can You Register In Hong Kong?
Although Hong Kong allows for the establishment of a wide range of businesses, you must first choose whether you want to run your activities from Hong Kong or another location. You will gain from this decision in terms of taxes and other areas as well. We've outlined each business structure below to make it easier for you to choose the one that is best for you:
A sole proprietorship is a company with just one owner, who bears full financial responsibility for both profits and losses.
A partnership with a minimum of two and a maximum of twenty participants is formed to split profits. In a general partnership, each member is responsible for the business's profits and debts personally. Another option is to create a limited partnership, in which general partners are responsible for their total investment and limited partners are just responsible for their initial investment.
Companies Limited by Shares Individually
A private limited company having a maximum of 50 shareholders by shares is treated as a completely different legal entity apart from its owners and shareholders.
Public Limited Company
Large businesses should choose this option if they want to list on a stock exchange to raise money. If there are more than 50 shareholders, this firm can subscribe to its shares and is often listed on the SEHK.
Limited Liability Company
Organisations that are charitable and non-profit can use this corporate structure. Every member of the company has to guarantee that a predetermined amount will be paid in case of company liquidation. The predetermined amount will be stated in the company's Article of Association (AoA).
The admission office is nothing but a foreign corporation that is provided permission to function in the city of Hong Kong. It is not necessarily treated as a separate legal entity in the City.
An expansion of a foreign business that is restricted from conducting profitable commercial activity. It is suitable for non-commercial operations like human resources and marketing.
Advantages of Registering a Company in Hong Kong
Registering a company in Hong Kong comes with its own set of advantages. Some of them are discussed below.
Greater business freedom:
Hong Kong has established a reputation for being the freest jurisdiction on the planet, along with Singapore. This makes registering a business in Hong Kong easy, quick, affordable, and practical
You can manage your Hong Kong-incorporated business from any location in the world. Your business will be able to run professionally every day and advance through the help of an agency
Hong Kong serves as the most effective entry point into Mainland China, opening up a market of 1.3 billion people. Once you have completed the business registration process in Hong Kong, more than 30 countries that have bilateral trade agreements with Hong Kong will also treat your company more favorably
Hong Kong is a special administrative region in the Republic of China. It has greater autonomy and the ability to administer its government.
Eligibility Criteria for Company Registration in China
A potential applicant must meet the following requirements to be eligible for the company registration process in China:
- Directors Required: The company needs a minimum of 3 to 13 directors
- Chairman and Deputy Chairman: There must be a chairman and a deputy chairman for the company
- Business Locations: The business must have a registered address for the company to conduct operations in China
- Legal Representative: To complete the steps involved in registering a company in China, a legal representative must be designated there
- Reserved Name: In addition to this, the company's name needs to be protected.
Compliances for Company Registration in China
A Chinese-incorporated corporation must adhere to the following regulations:
- Chinese-language financial statements must be filed. Such Statements must be submitted every month
- The SAMR must receive the annual report. This needs to be done within the acceptable time frame (01 January to 30 June)
- The overall business tax rate is stationed at 25%. The corporate tax rate is 15% for businesses covered by the Chinese Government Business Scheme, though
- Every company is required by law to hold an annual general meeting. Typically, private corporations have their annual general meetings nine months following the conclusion of the fiscal year
- The Chinese Accounting Standards must be followed by all businesses when updating their books of accounts. This has to be done every month
- A business must submit a quarterly corporate income tax return
- VAT Returns must be filed by the 15 of every month, or earlier.
Documents Required to Register a Company in Hong Kong
- Company name (as approved)
- Registered office address
- Legal representative's tax ID
- The company supervisor's ID
- Information about shareholders and directors
- Shareholders' documents notarized
- Memorandum of Association (MoA)
- Articles of Association (AoA)
- Capitalization schedule of the company