Opening a Company in Hong Kong

Our company formation experts in Hong Kong can help you open any type of company here. 

What types of companies can I open in Hong Kong?

The most important types of Hong Kong entities are:

1. Limited liability companies: these can be public or private, and they are separate legal entities; the founders are thus protected against business risks and have limited liability. 
2. Sole trader: the simplest business form and also the one with the highest degree of liability; it is incorporated by a single individual.
3. Partnership: a business structure formed between two or more partners in which at least one of them has full liability.

We invite you to watch this video about the process of opening a company in Hong Kong:

Should I incorporate a PLC / LLC in Hong Kong?

Most foreigners do. Small and medium companies are set up in the form of the private limited company, the most widely used business form. Here are its advantages and the particularities:

• It is a separate legal entity and the founders have limited liability, as previously stated; should the business not succeed, the shareholders lose their investment in the company (the shares they hold);
• The company’s share capital is divided into shares that correspond to a certain class; these classes are described in the company’s constitutive documents (the Articles of Association);
• The company’s shareholders are entitled to a percentage of the company’s profit in the form of dividends, distributed accordingly;
• It can easily raise capital; it is also easy to transfer its ownership.

What company formation packages do you offer in HongKong?

Examples of packages for one-time company formation are listed below:

Core services for company formation in Hong Kong with a secretary office address – USD1,000:

• USD 700: includes the preparation of the company formation documents, the government registration fee, and the issuance of the certificate of incorporation;
• USD100: first-year secretary service in Hong Kong (mandatory according to law);
• USD 100: the first-year registered address fee;
• USD 50 each for the first-year electric signboard service and the ultimate beneficial owner registration (for the first year).

Company formation package in Hong Kong with an independent office for one year – USD 1,800. In addition to the services presented above, this package includes:

• An independent office address in Hong Kong for USD 800 for the first year of the company’s existence.

Bank account opening services are taxed separately, as follows:

• USD1,000 for physical bank account opening – with mandatory attendance on the part of the company founder(s);
• USD500 for digital bank account opening.

In addition to the setup packages, our agents can also offer annual compliance and maintenance packages.

What are the main steps for company formation in Hong Kong?

We present the necessary procedures for investors who start a business in the HKSAR:

1. Choose a company name: the company name must be an original one; a name checkup can be performed.
2. Draw up the company documents: the Articles of Association and any other company Resolutions are drafted during this step.
3. File for registration: the documents and a filled-in application form are submitted to the Companies Registry; among the required documents, the founders will also need to include copies of their identification documents. If the documents are submitted as per the current requirements, the Business Certificate is issued in approximately one week.
4. Register with the Inland Revenue Department: for investors who open a company in Hong Kong, an important and mandatory step is that it needs to be registered for tax purposes.
5. Obtain any other permits and licenses: this step will depend on the chosen business field; special arrangements for hiring employees must also be made.

What documents do I need to open a company in Hong Kong?

When working with our local team of company incorporation agents, we will ask you to provide us with the following:

• The passport copies of the new company’s shareholders and directors;
• Recent proof of address for each director and shareholder (such as a utility bill or a bank statement issued in the past 3 months);
• Your proposed company name preferences (we ask you to provide us with 2 or 3 options to avoid the situation in which one name is not available for use);
• The authorized share capital for the business (the standard amount is HKD 10,000 or about 1,100 USD/1,275 EUR; please see below for more details);
• A description of the business scope (in English or Chinese, as our team will have to stipulate the main object of activity for your new company).

Once our agents receive the aforementioned documentation, the company’s constitutive documents can be drafted.

How long does company formation take in Hong Kong?

You can expect 8 to 10 working days for the company registration process, provided that:

• There are no government processing details (such as public holidays in the chosen time period);
• All the documents are correct and complete (there are no invalid documents, and the name reservation process moves forward with one of the first proposed names).

Does my company require an address in Hong Kong?

Yes. This is mandatory for company creation. Options include:

1. Registered office address: tenancy agreement, as per the local rules, to maintain a local address for the Hong Kong registered company;
2. Premium business address: tenancy agreement for a professional address with utility bill and company signage;
3. Virtual office address with a co-working desk that allows access to a physical workspace, ideal for companies that schedule meetings.

How are companies taxed in Hong Kong?

Company formation in Hong Kong is attractive for many reasons; however, an important one remains the attractive taxation regime for companies.

Below, our team highlights the most important taxes for companies:

• The standard corporate income tax rate is 8.25% for corporations and a lower rate of 7.5% applies in the case of unincorporated businesses; these corporate income tax rates are in place for the first HKD 2 million of the company’s assessable profits;
• The remaining assessable profits are taxed at 16.5% or 15% for unincorporated businesses;
• Hong Kong does not impose a withholding tax on dividend payments;
• Hong Kong does not impose value-added tax or sales tax;
• The employer and the employee make mandatory social security contributions of 5% of the employee’s income;
• Hong Kong does not impose a payroll tax ;
• Hong Kong has signed approximately 45 double-taxation agreements with countries around the world.

Do I need special permits and licenses for my company in Hong Kong?

For some activities, yes. Special permits and licenses are required for businesses that sell or prepare food (restaurants and other food shops), those that sell non-food goods (electrical appliances, firearms, chemicals, materials, and others) as well as for those companies that provide various services (amusement, construction, education, financial services, land and air transport and others).

Furthermore, companies that perform activities related to offering nursing home care services and those engaged in activities that have an impact on the environment are required to obtain more than the regular business registration permit. These special permits or licenses are issued by the relevant Hong Kong authorities, and one of our agents can help you apply for these.

Please ask our specialists in company formation in Hong Kong for more details about setting up a company in this jurisdiction.