- Hong Kong has a reputation as one of the most prestigious jurisdictions in the world.
- An alpha city has a simple tax system with low tax rates (basic income tax rate is 16.5%). Also, there is no taxation for companies operating outside the territory of Hong Kong and zero taxation on dividends and capital gains;
- There are no currency controls in Hong Kong;
- Clevver provides a simple registration of a company in the jurisdiction that does not require the physical presence of the owner at the most favorable price.
Hong Kong is a special administrative region of the People’s Republic of China, located on the Kowloon Peninsula. It is widely recognized as the center of trade and business in the Asia-Pacific region. Hong Kong’s economy is based on a free market, low taxation, and non-interference by the state. Thanks to very rapid economic growth, the region has become one of the four “Asian Tigers”, along with Singapore, South Korea, and Taiwan. The official languages are Chinese and English.
Registering a company in Hong Kong offers great opportunities for business development and prosperity. A favorable investment climate, stable legislation loyal to non-residents, and a developed economy make the jurisdiction especially attractive for foreign entrepreneurs to open a business here.
For those who want to form a limited company (LTD) in Hong Kong online, Clevver will gladly provide qualified assistance. Our specialists will incorporate a business entity remotely, you will not have to visit Hong Kong in person, and provide a full package of documents on the company registration in a digital form. Click here to find out more.
Taxation in Hong Kong
- Income Taxation. In Hong Kong, there is a territorial principle of taxation. It means that the income of Hong Kong companies is taxable only if it is derived from a source in Hong Kong or if the activity to derive such income was carried on in Hong Kong. If the company did not conduct activities in the territory of Hong Kong and did not receive income from sources in Hong Kong, income tax is not charged on it.
Income derived from sources in Hong Kong is subject to income tax under a two-tier system at the following rates:
|Amount of profit||Legal entities|
|Not more than HKD 2,000,000 (Hong Kong dollar)||8.25%|
|Over HKD 2,000,000||16.5%|
Where profit exceeds HKD 2,000,000 (approximately USD 257,000) the corporate income tax rate of 16.5% will not apply to the full amount of profit made, but only to that part of it that exceeds HKD 2,000,000.
- Dividends paid by a Hong Kong resident company to a foreign company are exempt from withholding tax in all cases. Also, dividends paid by a foreign company to a Hong Kong company will not be subject to Hong Kong income tax.
- Royalties paid by a Hong Kong resident company to a non-resident may be subject to Hong Kong withholding tax where the copyright and/or intellectual property is actually used in Hong Kong, or where the royalty is effectively deductible for income tax purposes. The effective rate is 4.95% for payments to parties that are not related to the Hong Kong company paying the royalty. If the parties are related, the standard withholding tax rate of 16.5% applies.
- Hong Kong law does not provide for VAT, and capital gains tax is not taxable in most cases.
8 Reasons to Open a Business in Hong Kong
- Developed and stable economy, Hong Kong is one of the most developed and advanced, stably existing economic regions in Asia.
- The country has minimal requirements of the state authorities to the procedure of opening a company and short terms for business registration;
- No taxes if profits do not originate in Hong Kong (the use of the territorial principle of taxation, where the income derived outside the country is not subject to taxation), or low tax rates if profits are made in Hong Kong;
- No restrictions on foreign investment, capital flows, and income.
- There are no currency controls in Hong Kong, the company can transfer funds for transactions relating to the business activities of the company at any time, in any currency, and to any country.
- There are no customs duties, Hong Kong is a free port.
- Firms registered in the territory of Hong Kong are entitled to conduct any legal activity. For such activities as credit, insurance, banking, investment consulting, a special license is required.
- Good geographical location close to mainland China.
Incorporation in Hong Kong with Clevver
Clevver experts will help register a company in Hong Kong remotely. We provide all the necessary advice on matters of interest to you in the process of opening your business in this alpha location. Our specialists will set up a company in Hong Kong cost- and time-efficiently, and save you from procedural and registration hassles on the way.
WHAT WE OFFER:
- The quality assistance of the highly-qualified legal specialists;
- Online procedure of registering a business in Hong Kong;
- An essential set of documentation on the company formation in a digital format;
- Possibility to receive many extra to business incorporation services (registered address in Hong Kong (link), mail-handling service, and many more)
- Competitive pricing for the business registration service;
- Consistent customer support and individual approach to each client.
Hong Kong — it is minimum prohibitions and costs, and maximum conveniences for business development. As a major financial center of Asia, Hong Kong is very attractive in terms of favorable conditions for trade and entrepreneurship. Business infrastructure, simplicity of taxation, and corporate legislation create opportunities for the arrangement and success of the international business.
Clevver legal team will register an LTD for you in Hong Kong, reach our legal team out for more information!