There are numerous benefits in creating a company based in Hong Kong, not least its proximity to mainland China and all the opportunities this will deliver.
There are also numerous tax advantages for businesses, and Hong Kong delivers both trade and monetary freedom that outperforms any other jurisdiction in the world.
5 Benefits of Basing Your Company in Hong Kong
- One of the first things that attract global businesses is a beneficial tax system. Hong Kong profits tax is only charged territorially on Hong Kong source income at a rate of 8.25% for profits up to HK $2million (c. US $258K); and 16.5% on any part of assessable profits over HK $2 million. Income generated from outside Hong Kong is generally not taxable. Hong Kong does not have capital gains tax, dividend tax or VAT.
- Hong Kong has rightly been called the freest economy in the world with exemptions on tax and excise duty. If imports need licences, this is very easy to arrange.
- Access to mainland China is another reason why so many businesses open a company in Hong Kong. Strong infrastructure, including transport and telecommunications, make this a vital hub for companies that want to build relationships with Chinese markets.
- With a population of nearly 7.5 million, companies also get access to a talented, highly qualified and motivated workforce, many of whom have English as their second language.
- Hong Kong is a great place to live with flexible work visas, efficient banking services and good quality of life.
How to Set Up a Business in Hong Kong
It’s important to work with a company formation service that understands the landscape in Hong Kong and can help you navigate the paperwork and stay on the right side of the legal system. Hong Kong is open and welcoming and a company formation is fairly simple with the right documentation and normally takes just a few days.
If you are thinking of setting up a business in the jurisdiction of Hong Kong, contact our expert team at International Formations today.