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How do I set up a HK company?

How do I set up a HK company?

Setting up a company in Hong Kong involves several steps:

  1. Preparation:

  • Familiarize yourself with relevant institutions like the Companies Registry and Inland Revenue Department (IRD).

  1. Company Structure:

  • Choose a company name following their guidelines.

  • Decide on the legal structure - most common is a limited liability company.

  • Appoint at least one director (can be a resident or non-resident).

  • Select a company secretary (can be a person or a company).

  • Determine a registered address in Hong Kong.

  1. Registration:

  • Prepare the incorporation documents, including a completed form, Articles of Association, and details of shareholders and directors.

  • Submit the documents and the fee to the Companies Registry.

  1. Post-Registration:

  • Obtain a Business Registration Certificate from the IRD.

  • Open a corporate bank account.

  • Acquire any necessary licenses or permits for your business activity.

  1. Ongoing Requirements:

  • Maintain statutory records and accounts.

  • File annual returns and tax returns.

Consider using a professional service firm to assist you with the process, especially if you're unfamiliar with Hong Kong regulations. They can handle the paperwork, ensure compliance, and advise on legal structures and tax implications.

Can foreigner set up company in Hong Kong?

Hong Kong is actually quite welcoming to foreign business ownership. Here's some good news for you:

  • Foreign Ownership: There is no restriction on foreign ownership in Hong Kong. You can set up a company with 100% foreign ownership.

  • Minimum Requirements: You only need one director and one shareholder, and neither needs to be a Hong Kong resident.

There might be a recent requirement you'll want to double check on: Since 2019, companies may need to appoint a Hong Kong resident to act as a company representative to maintain a "Significant Controllers Register". This helps with transparency.

Overall, setting up a business in Hong Kong as a foreigner is a feasible process.

What is the minimum capital for Hong Kong company?

The good news for setting up a business in Hong Kong is that there's no legal minimum capital requirement. This means you can establish a company with a very small initial investment.

However, there are a few things to consider:

  • Standard Practice: While there's no minimum, it's customary for companies to have an authorized share capital. A common amount is HK$10,000 divided into 10,000 shares of HK$1 each.

  • Capital Duty: There's a small capital duty of 0.1% payable on the authorized share capital, capped at HK$30,000. So, for a HK$10,000 capital, the duty would be HK$10.

So, technically, you could start with a capital of HK$1 (one share) but having a slightly larger authorized capital shows a level of seriousness and provides some flexibility for future growth.

How much does it cost to set up a company in Hong Kong?

The cost of setting up a company in Hong Kong can vary depending on several factors, but here's a breakdown to give you an idea:

Mandatory Fees:

  • Company Registration Fee: This is a one-time fee paid to the Companies Registry. It can be around HKD 1,500 for electronic application and HKD 1,700 for hard copy.

  • Business Registration Certificate: This is obtained from the Inland Revenue Department (IRD) and has varying costs based on the chosen duration (usually 1 or 3 years). It can range from HKD 2,150 to HKD 5,650.

Optional Fees:

  • Registered Address: If you don't have one in Hong Kong, you might need to use a service address provided by formation agencies, which can cost extra.

  • Company Secretary: A company secretary is mandatory in Hong Kong. You can act as your own secretary or use a professional service, typically costing between HKD 3,000 and HKD 10,000 per year.

  • Formation Agent Fees: Using a professional service to handle the registration process can cost anywhere from HKD 5,600 to HKD 30,000 or more, depending on the complexity and additional services offered.

Total Cost Estimation:

Taking the minimums, you could potentially set up a company with just government fees and a basic formation service for around HKD 3,695 (electronic registration + 1-year Business Registration Certificate). However, this is a bare-bones approach.

A more realistic range, including a registered address and professional secretary service, would be around HKD 8,500 to HKD 18,500.

Remember, this is just an estimate. It's always best to consult with formation agencies or lawyers for a more accurate quote based on your specific needs.

How Bestar can Help

How do I set up a HK company?

Bestar can assist you with setting up a Hong Kong company in several ways:

  • We can guide you through the process of company registration: This includes completing the necessary forms, liaising with the Companies Registry, and ensuring all requirements are met.

  • We can advise you on the most suitable business structure for your company: We can help you choose the right structure based on factors like liability, ownership, and tax implications.

  • We can help you obtain a Business Registration Certificate from the Inland Revenue Department (IRD).

  • We can assist you with opening a corporate bank account: This can involve preparing the necessary documentation and liaising with the bank.

  • We can help you comply with ongoing statutory requirements: This includes filing annual returns and tax returns.

By using Bestar's services, you can save time and ensure your company is set up correctly from the beginning.

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