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CatcherBiz
to guide you
through
Why Hong Kong?
Before Incorp.
Day of Incorp.
First Year Arrangement
Annual Renewal
Subsequent Changes
Accounting, Auditing and Tax Matters
Doing Business in Hong Kong

Why Hong Kong?

Before Incorp/

01 Top notch location worldwide

02 Simple to setup

  • Ranked world top location for business (HERE)

  • Gateway to doing business in China and prime offshore RMB center

  • Excellent legal and tax framework with government stability

  • Fourth largest stock market in Asia, great place for investment or find your angel investors or even go for listing

  • Access to diversified talents, matured infrastructure, and transportation hub of Asia

  • Well-known trading, importing, and exporting center because its duty-free status for most commodities, even for most of the wine and food products

  • At least 1 Individual Director,

  • Sole Shareholder can act as sole Director

  • Minimum with 1 share (Wholly owned)

  • NO nationality restriction on Director and Shareholder

  • NO local Director requirement

  • NO physical presence in Hong Kong

  • E-registration in 1 working day (without corporate Director / Shareholder)

  • Or by paper submission in 7 working days for those with corporate Director / Shareholder

03 Simple, low

      and straight forward

      tax system

  • Territorial tax system

  • No capital gain tax

  • No sales tax, GST or VAT

  • No dividend tax

  • ONLY 16.5% on net profit (assessable profit)

  • AND 8.25% on first HKD2 million from 2018/2019 onwards

  • Multiple deductibles arrangement

    • Generally, all outgoings and expenses are deductibles

    • Expenditure on Building refurbishment, Plant and machinery, Environmental protection Facilities

    • Depreciation allowances

    • Donations up to 35% of assessable profit​

04 Full of resources

      and supports

Day of Incorporation

Day of Incorporation

and
First Year Arrangement

01 CatcherBiz as

      your agent

  • CatcherBiz can provides further assistance on

    • Submission of IRBR200 to report commence of business to tax department​

    • Renting your office in Hong Kong

    • Hiring your first staff in Hong Kong

    • Apply for necessary working VISA

    • Any other local issues that you need assistance on

​

02 Ready to setup

      the company

  • CatcherBiz can assists you to set up the corporate bank

  • We will assist in all compliance and due diligence  requirements of the bank, including

    • KYC (Know Your Customer)

    • AML (Anti-Money Laundering)

    • CRS (Common Reporting System)

    • FATCA (The Foreign Account Tax Compliance Act - USA)

    • AEOI (Automatic Exchange of Tax Information)

  • We will guide you through the difficult bank account process, especially start-up business, still able to do so if well-prepared with sufficient business proof

 

03 Let's kick-off

04 Open a Bank

      Account

  • CatcherBiz can provides

    • One stop HK company setup and maintenance​

    • Accounting and Auditing

    • Bank account opening

    • Certified true copy / Translation of corporate documents by HKICS member (Chartered Secretary) (HERE)

    • Notary Public / Apostille / Legalization by HK lawyer

    • Liaison point in HK of all sorts of government application, VISA, MPF, employment insurance, office rental matters ... etc.

  • Further readings

    • Why you need an agent (HERE)

    • How to choose a trustworthy agent? (HERE)

​

  • Send us by email 
    catcherbiz@outlook.com

    • Preferred Company name

    • Scan copy of your passport and address proof

    • Company Structure and KYC

  • CatcherBiz can setup your company with just 3 simple steps (HERE)

  • How to come up with a good company name (HERE)

Annual Renewal

Around the 18-22mths to receive

first Profit Tax Return (PTR) ;

need to return to Inland Revenue

Department (IRD) within 1 month;

01 Reminder

  • Receive reminder email from CatcherBiz

  • Cross-check of any changes of company structure / information during the year

    • Passport number

    • Residential address

    • Contact information

    • Shareholder(s) / Director(s)

  • Arrange payment

  • EXIT procedure if business value dropped

the 10th or 11th month

02 Annual Renewal

  • NAR1 (Annual Return)

  • BR (Business Registration)

  • IRBR200 (Notice of commencement of business) (if applicable )

  • Reminder on Accounting, Auditing and Profit Tax Return (PTR) filing arrangement

the 12th month

Anniversary Date

late 30 days

BR penalty HKD300

late 42 days

NAR penalty HKD870

late 3 months

NAR penalty HKD1,740

03 Audited Report

  • Decided your first accounting reference day.  Usually

    • 31st March; or

    • 31st December

  • Ready with your accounting report covering from date of commencement of business to the end of the accounting period

the 18th month

the 21st month​

04 Annual General        Meeting

late 6 months

NAR penalty HKD2,610

late 9 months

NAR penalty HKD3,480

  • Within 9 months after First Anniversary ; or

  • 3 months after the end of the accounting reference period;

  • whichever is later

  • For members to approve

    • Audited Financial Statements

    • Reappointment of Director (if retirement applicable)

    • Director(s) remunerations

    • Reappointment of Auditors and remunerations

Annual Renewal
Subsequent Changes

03 Change of

      Company Name

Subsequent Changes

01 Change of

      Director

02 Change of Shareholder

​

​

   04 Amendment of Articles of Association

​

   05 Change of 

Registered Office Address

06         EXIT

      Arrangements

Accounting, Auditing and Tax Matters

01 Hong Kong Tax Framework

  • Simple tax structure, no VAT, no GST, no capital gain tax, no global income tax

  • Two-tiered rates of 8.25% on first HKD2mil net profit, thereafter 16.5%

  • Most of operation expenses are deductibles to further reduce tax burden

  • Business losses can carry forward to off-set coming years profits

​

Practical arrangements

  • Basis period normally 31 Mar (year-end adopted by HK government as well), or 31 Dec, where is the year-end of PRC companies

  • Always allow good time in advance for certain adjustment and planning to utilize all legitimate deductibles allowed

02 Employer’s       

      Return (ER)

  • Around April / May each year to complete the yearly return

  • Even you do not hire any employee / no business being commenced

 

Further obligations when you have hiring

  • Lodge ER within 3 mths with NEW employment, change of terms, termination, and at time of leaving Hong Kong

  • Payroll, Employment contract, MPF and personal particulars records shall be maintained for at least 7 years

 

  • Heavy penalties and even prosecution will be imposed if failure to comply

03 Profit Tax

      Return (PTR)

  • First PTR – 18-22 mths after incorporation with 3 mths to complete

  • Thereafter, issue around the end of accounting period, and  reply within 1 mth

  • MUST reply even pending to commence business

 

Further obligations when you have commenced business

  • Submit the PTR with latest audited report in advance / together

  • Business records (invoices / quotations / contracts / agreements) shall be maintained for at least 7 years

 

  • Heavy penalties and even prosecution will be imposed if failure to comply

   04 Tax planning

Tax planning often a reason to setup

  • Tax Residency Certificate to enjoy certain double tax reliefs

  • Investment vehicle as no additional capital gain tax

  • Partial off-shore claims for income derived outside Hong Kong

  • Holding royalties income

  • Inter-group currency exchange hub for international MNC

  • Saving of stamp duty of share transfer by offshore structure

 

Need to closely observe the development in AEOI, BES, CRS, FATCA and any other international (worldwide) tax regime carefully to avoid suspicious tax avoidance / evasion  crime

Accounting, Auditing and Tax Matters

Doing Business in Hong Kong

01 Common Use of Hong Kong Company

  • Investment Vehicle (no capital gain tax in Hong Kong)

  • Holding company (such as WFOE in China)

  • Liaison and Sourcing office for import-export or re-export office

  • Asia market head quarter (great transportation to China and elsewhere)

  • Asset protection (Excellent legal system)

  • Royalty (Payments are deductible for profits tax purpose)

02 Major Operating Costs in Hong Kong

  • Office Rental

  • Staff Cost

    • Salary

    • MPF

    • Employee Insurance

    • Subsidies for secondment

  • Profit Tax

  • Company maintenance fee (renewal, accounting and auditing fees)

 

Cost of living in Hong Kong for budgeting

03 Gateway to

China Opportunities

  • Easier to arrange corporate documents on setting up of WFOE (Wholly Foreign-Owned Enterprise) in China (Need relevant documents in Chinese)

  • Often with incentives and favorable policies  exclusive for Hong Kong (CEPA, Double tax relief, Fintech –Qianhai, IT Research, Bay-area development … etc)

  • Feasibility analysis (Hong Kong often as trend leader of China)

  • Trial for market acceptance test (lower investment barrier compare to China with more freedom on business nature)

  • Also to predict the China market growth potential before  heavy investment commitment

Doing Business in Hong Kong

Something Missing?

Any topic you can't find in this page?

Not a problem, simply drop your enquiry to

catcherbiz@outlook.com

and we will get back to you very soon!!

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