Hong Kong has low taxes and an easy corporate structure. It is no wonder that so many entrepreneurs prefer to establish themselves there. However, when considering incorporating here, you will want to know how easy it is. Here is a walk-through of how to set up your company.
Table of Contents
Select Your Company Structure
The options for company incorporation in Hong Kong include:
· Private limited company
· Sole proprietorships
· Partnerships
· Subsidiaries of foreign companies.
Depending on your business, you will need to decide between a limited liability company and a shareholding company. Most of the foreign investors choose a private limited company due to:
· The limited liability
· Good credibility
· Flexibility to expand.
The decision will be based on your business objectives, though, in terms of scalability and minimal compliance, you would typically go with a private limited company.
Select a Company Name
A unique company name is needed before incorporation. The name should not resemble or be too similar to another firm in Hong Kong. You may select an English name or a Chinese name. You can also have them combined in one name.
However, do not combine both languages. You can verify name availability via a quick check on the online portal of the Companies Registry.
Select Directors and a Company Secretary
Each company in Hong Kong should include at least one director. They can be a foreigner without necessarily being based in Hong Kong. But you must also designate a company secretary. They can either be a person or a firm that is a resident of Hong Kong, or is registered as an office in Hong Kong. The secretary is very critical in managing compliance and filings, so choose wisely.
Establish Your Registered Office
Your company has to have a registered office address in Hong Kong. The address shall be used in formal communication and record-keeping. Most foreign companies use corporate service providers, who provide registered office addresses with their incorporation package.
Prepare and File Incorporation Documents
The next stage is to prepare the core documents to be registered. They include:
· Articles of Association, which are the constitution of your company
· Form of incorporation (NNC1), which contains information about the directors, shareholders, and secretary of the company.
These are filed at the Companies Registry online or physically. And with approval, you will get a Certificate of Incorporation. This is the legal evidence of the existence of your company.
Incorporate With the Inland Revenue Department
You should also get a Business Registration Certificate from the Inland Revenue Department alongside incorporation. This certificate has to be renewed after every one year or every three years, as per your choice. Without it, you cannot legally operate.
Open a Business Bank Account
Banking is effective in Hong Kong, but needs preparation. The majority of banks require elaborate business plans, incorporations, and operational evidence. Due to the diversity of requirements, it is a good idea to do some research on banks. You can also work with a service provider who can make the process more manageable.
Enforce Continuous Compliance
Once incorporated, your company will have to satisfy yearly requirements such as:
· Filing annual returns
· Renewal of Business Registration Certificate
· Auditing of financial statements.
Being in compliance will guarantee a running business and credibility with investors and partners.
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