Setting Up a Business With the Help of a Private Company
When you decide to establish a new business in Hong Kong, you have to give much attention to the benefits of company formation in Hong Kong. There are several benefits of company formation in Hong Kong. You can benefit from these benefits without any difficulty when you make a proper business plan.
The main advantage of Hong Kong business formation is that you need not pay any registration fees for this purpose. Besides, there are also no legal complications involved when you opt for startup options. Since you are not an employee of the other company, neither are there any fixed terms and conditions for transferring responsibilities or shares between the two companies. In simple words, the startup option does not involve any transfer of duties or shares. Overall, managing directors in Hong Kong business formation is very similar to that of the officers of a private firm.
Other significant benefits of company formation in Hong Kong are that the laws of taxation in the country are less stringent. You will have to pay tax only on the income from which profit has been made. Thus, you need not pay income taxes on the profits earned. The introductory tax rate in Hong Kong is only 3%, extremely low by international standards.
Moreover, company formation in Hong Kong also allows tax liabilities to another country without any hassle. All you need to do is fill a simple document known as an ‘iwi’, and you will become liable to pay tax in the country from where you have transferred the funds. Thus, you have the option of either paying the tax in one lump sum or the instalments agreed. Furthermore, the Companies’ Registration Office will be accessible, even for running businesses from home. The offices are located at the most convenient places in the commercial districts of Hong Kong.
There are several other benefits of company formation in Hong Kong. They can provide important information about these companies and their owners to the relevant government agencies such as the Income Tax Department of Hong Kong. This information is then used for auditing the activities of these foreign corporations. Thus, tax payments will be reduced or completely avoided for foreign corporations and local companies.
Apart from tax benefits, company formation in Hong Kong also provides a lot of other services. The Companies’ Registry keeps a record of all the private companies that are registered with them. They are then categorized according to their size, capital, and business sector. It makes it easy for investors and business owners to choose between different private companies of their liking. Moreover, private companies are always given the benefit of the registered office, which ensures that their respective managers and directors are all legitimate and resident of Hong Kong.
Private company directors also establish companies. In this process, the company secretary is expected to arrange the necessary appointments for the principals and the directors. When making the appointment, the general meeting of the shareholders needs to be held. The company secretary will make the necessary announcements in the newsletter provided for this purpose. This newsletter is released regularly to give all information regarding the meetings and proceedings of the general meeting of shareholders.
The secretary of the company must be appointed as the company’s general manager. Once all the necessary documents are in place, the company can already apply for an appointment with the registrar’s office of the Hong Kong SAR. After the registration of the company’s name with the registrar’s office, it will be required to submit audited accounts of its last three years of business. These accounts will help the registrar assess whether the company is solvent and capable of conducting business. If everything looks good, then the next step will be an easy and fast registration with the registrar’s office.