Hong Kong is the perfect economy to start a business if you’re a new business owner. It has held the world record for the freest economy over the last 2 decades, and it has the lowest level of bureaucracy and restrictions. This is why there was a total number of more than 1,300,000 companies that were registered in Hong Kong by the end of 2018. However, as a top economical and financial center for many beginning businessmen, it is considered one of the most competitive economies in the world, ranking number 6 on the World Economic Forum’s Competitiveness Index. It is also governed by a very reputable and regulated jurisdiction where the financial resources and business are flourishing. If you’re thinking about starting a business in Hong Kong, this article gives you the top 4 things to know.
-
You Need To Open A Company Account
In order to set up any type of business, you need to acquire proper financial services that can help you fund your ventures. While the process of opening up a bank account is pretty straightforward for personal accounts, a lot more documents and paperwork are needed to prove to the bank that you run a business. A Hong Kong bank will ask for the registered address of the company as well as the contact information of both the company and its owners. In addition to the documents mentioned in the bank’s application form, you’ll need certification by a public accountant, a company secretary, a lawyer, or a banker. You’ll also need Proof of Business, for example, a business plan or an audited financial statement. Other documents you’ll need to open up a company account include details about the ultimate beneficial owners for nominee stockholders or shareholders, a Registration Certificate, a certified copy of your company’s identification documents, and your company’s incorporation document.
-
Investment Opportunities In Hong Kong
It is much easier to start a business in Hong Kong than it is in any other country. Many people consider it a great idea as Hong Kong has one of the simplest and cheapest registration processes for new businesses. However, what really attracts those young investors and businessmen is the growing opportunities for investment in Hong Kong’s E-commerce, financial technology, healthcare, information and technology, hardware, data analysis, professional services, education, and learning. These fields are booming with new ideas and investing in either one of them is guaranteed to give you great returns. However, they’re also highly competitive fields that require skills and experience. The contribution of such a large number of entrepreneurs in this field has made the economy in Hong Kong one of the greatest across the world.
-
Company Registration
One of the first things you’ll need to do before starting a business in HK is registering with the Companies Registry. It is essential for any company based in Hong Kong to be registered with the Companies Registry as it is the institution that governs the incorporation of any business. You’ll notice that many startups and young investors register their companies under Limited Company because of the many benefits of this entity. In Hong Kong, a Limited Company is a completely separate legal entity that protects your personal assets when your company is facing business risks. Additionally, this business model offers a much more straightforward process for raising capital or funds and transferring ownership compared to other business entities. Choose the business entity that suits your business sector and get your company registered so that you can proceed with the next step to start a business in Hong Kong.
-
Taxes In Hong Kong
Hong Kong is also known for its low tax rates that are not just the lowest in Asia, but also the world. Although profit tax is not enforced on businesses that are operated from outside of Hong Kong, many of the deductions in HK taxes are actually beneficial to your company. Right now, the profit tax rate for companies that are operated from within Hong Kong is 8.25% on the first 2 million worth of Hong Kong profits. It also stands at 16.5% on companies operating from anywhere else and there’s no capital gains tax applied.
If you’re starting a business in Hong Kong, you’re investing in one of the freest and most competitive economies around the world. Just like starting a business anywhere else, you’ll need to open up a company bank account so that you can fund your business and register your company with the Companies Registry. You’ll also need to learn about the types and rates of taxes that apply to your business entity depending on where you’re operating your HK business from.
