Hong Kong

About the Country

The Hong Kong Special Administrative Region of the People’s Republic of China (Hong Kong) is an autonomous territory on the Pearl River Delta of China and world’s most significant financial centers having highest Financial Development Index score. It ranks as the world’s fourth most densely populated sovereign state or territory. The below content will explain you in detail about the requirements for the company formation in Hong Kong, know more about the process of trademark registration in Hong Kong and understand the Hong Kong Legal Compliance requirements.

Hong Kong

Doing Business Introduction

Hong Kong has one of the highest per capita incomes in the world, however there is severe income inequality.  The Country is having very high Human Development Index ranking and the world’s longest life expectancy. As per Doing business report of The World Bank –Hong Kong ranks 4 for 2017 survey.

YourGlobalPro professionals are able to assist its client with any type of company formation in Hong Kong, trademark registration in Hong Kong and other recurring services for your business in Hong Kong.

Incorporation - Types of Business Entities

The various types of entity that can be incorporated in Hong Kong are as mentioned below:

  • Representative Offices (ROs)
  • Equity Joint Ventures (EJVs)
  • Cooperative Joint Ventures (CJVs)
  • Wholly Foreign Owned Enterprises (WFOEs)
  • Joint Stock Companies (JSCs)

Time Frame for Incorporation of Company in Hong Kong varies from depending on the type of entity selected. Each business type has its own advantages and disadvantages. YourGlobalPro estimates the time required for the process of Company formation in Hong Kong to be 2-5 working days.

Benefits of Registration of a Company

Below are few advantages of company formation in Hong Kong:

  • Strategically located
  • World’s Freest Economy
  • Asia’s second largest and the world’s third largest Foreign Direct Investment recipient
  • Ranks 3rd in terms of ease of starting business as per world Bank survey
  • No policy to protect the local industry against foreign competitors
  • A free port and generally imposes no customs duties on imported goods
  • Policy of minimum intervention towards the regulation of the territory’s business and industry, investors

Tax Registration and Filing

The fiscal year runs from 1 April to 31 March and the Companies make two payments of profits tax during a fiscal year. The foreign tax credit is available under the full comprehensive double tax treaties.

Corporate Income Tax Rate 16.5%
Capital Gains Tax Rate 0%
Branch Tax Rate 16.5%
Dividends 0%
Interest 0%
Royalties from Patents, Know-how 4.95% / 16.5%
Branch Remittance Tax 0%

Double Tax Treaty

Double Tax Agreements regulates the tax treatment of income or capital gains in situations where the same taxpayer is taxed twice in two countries for the same subject. Hong Kong has signed double taxation treaties with countries all over the world as mentioned below: Austria, Belgium, Brunei, Canada, China, Czech Republic, France, Hungary, Guernsey, Indonesia, Ireland, Japan, Jersey, Kuwait, Liechtenstein, Luxembourg, Malaysia, Malta, Mexico, Netherlands, New Zealand, Portugal, Qatar, Spain, Switzerland, Thailand, U.K., Vietnam

Trademark registration

In Hong Kong, the Intellectual Property Department reviews and grants approval for trademark registration and intellectual property rights. Trademark Registration in Hong Kong is valid for 10 years from the date of application and can be renewed for further 10 years before expiration date. It is recommended commence the trademark registration in Hong King as soon as possible to ensure adequate protection. The time frame to complete the trade mark registration in Hong Kong takes approximately 9-10 Months.

YourGlobalPro is fully equipped to assist you with the process of trade mark registration in Hong Kong for business. For assistance or advise in the matter of the trademark registration in Hong Kong or intellectual property – please feel free to write or contact us.

Secretarial Compliance

Before setting up company a foreign company should review its current investments and future business plans.

  • The Companies are required to be registered with required to be registered with the State Administration of Industry and Commerce (SAIC) or its local counterparts
  • directors of every company must lay before the shareholders in the annual general meeting audited financial statements
  • Every company incorporated in Hong Kong must appoint one or more independent auditors who must be a member of Hong Kong Institute of Certified Public Accountant (HKICPA) and hold a practicing certificate issued by the Institute.

Accounting Services

All the Hong Kong incorporated companies are required to prepare financial statements that give a true and fair view in accordance with Hong Kong Financial Reporting Standards (HKFRSs) issued by the Hong Kong Institute of Certified Public Accountants (HKICPA).

YourGlobalPro professionals can assist you with the entire bookkeeping and accounting services for your Hong Kong Business Setup as per your business needs including implementation of financial accounting software, accounting records preparation and time to time preparation of budgets, forecasts.

Auditing service

The Hong Kong law requires the annual financial statements of all companies to be audited.  Also, the financial statements under Hong Kong Standards on Auditing issued by HKICPA and needs to be laid before the company in the annual general meeting.

YourGlobalPro provides you auditing services for your business as required by your business.

Banking

The documentation requirement differs from Bank to Bank and need to be complied for the Bank account opening. It is recommended to compare commission rates for money transfer to and from Hong Kong at the time of Bank Account opening. The Bank requires disclosure of the beneficial owners of the company.

YourGlobalPro professionals can facilitate all the paper work in relation to banking need and can assist you in opening bank account for your business plan in Hong Kong.

Legal and Compliance

Below is the various Hong Kong legal and compliance requirement to be followed by incorporated entities:

  • The branch of foreign corporation is doing business in Hong Kong, it is required to file a profits tax return annually, and the Inland Revenue Department
  • The companies in HK are required to make a mandatory contribution of 5% of employees’ relevant income up to a maximum of HK$1,250 per month to the Mandatory Provident Fund (MPF) scheme
  • The companies in HK require to obtain valid insurance policies for the employees
  • All business to be registered under the Business Registration Ordinance regulated by the Inland Revenue Department
  • no restriction on entry or repatriation of capital or remittance of profits from investments

YourGlobalPro professionals can assist in all Hong Kong Legal and Compliance requirements.

HR and Employment Law and Immigration / VISA

Below are some of the important points in relation to HR & employment law in Hong Kong:

  • All the employees are governed by various ordinance implemented by the Equal Opportunities Commission which includes the Employment Ordinance, Mandatory Provident Fund (‘MPF‘) Schemes Ordinance, Employees‘ Compensation Ordinance, Occupational Safety and Health Ordinance and four ordinances.
  • contract of employment can be made orally or in writing
  • prohibits the employment of children aged under 15 in all industrial undertakings
  • young persons are not allowed to work more than eight hours a day, 48 hours a week and 6 days per week and overtime, night work, rest days and work on statutory holidays are prohibited.
  • wage period should not be less than the statutory minimum wage rate of HK $28 per hour
  • The other nationality employee must obtain an employment visa in order to work in Hong Kong

Country Statistics

Area Total 2,755 Sq. Km.
Population 7,374,900
Density 6,544/Sq. Km.
Currency Hong Kong Dollar (HK$) (HKD)
Government Multi-party system
Official Language Chinese, English
Religion Main religions are Buddhism, Taoism and Confucianism 64% of Hong Kong residents do not believe in any religion
Business Offices Hours 08:30 to 17:30
Banks and Exchange Houses Hours Monday to Friday between 9:00 am and 4:30 pm Saturdays from 9:00 am to 12:30 pm

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