The first and most important stage in expanding overseas is to establish a business structure that complies with your requirements and the regulations of the country in which the firm will operate. Examining the pros and cons of your business’s current trajectory is essential.
In order to make a sound choice, consider the following questions.
What are the current and long-term requirements of your business?
- Approximately how big is your business?
- How much cash flow does a company need to get started?
- Will there be any more backers for this venture?
- Will you be able to get new people to put money into your business?
- What are the prerequisites, costs, timeframes, and other requirements?
- How does the use of this tool affect my tax liability?
- What are the short-term and long-term needs of your business?
Attorneys at Fintech Harbor Consulting help clients set up businesses in over 140 different countries. Business specialists will set up company formation services in Hong Kong with the utmost speed and competence since they will have a thorough awareness of your objectives and will be able to anticipate your demands. Fintech Harbor Consulting is a one-stop shop for all of your legal, corporate, government, and commercial information needs.
Because of its strategic location, Hong Kong has become a major economic and trading center for the whole world. Anyone with an interest in business understands that opening a shop in Hong Kong is a goal for many.
As a result, it is less difficult to establish a company in Hong Kong than in other places.
Since these professionals have extensive knowledge of Hong Kong’s law, they can help companies avoid common pitfalls and speed up the process.
When forming a business in Hong Kong, certain steps must be taken in a certain order. While Hong Kong law is of little value in this situation, the steps and paperwork you’ll need to submit to local officials in order to launch your own company are invaluable.
A “dormant” Hong Kong firm whose only purpose for being is to be sold might be a lucrative investment.
The PROS of Doing Business in Hong Kong
The entrepreneur is free to establish the firm under whichever legal structure he sees fit. These are the most typical examples:
- Individual business;
- Commercial collaboration;
- Limited liability private firm. The latter kind of corporate structure is the most often used.
Almost every local Hong Kong business may benefit from preferential tax treatment that reduces tax losses, making it possible for Hong Kong corporations to be remarkably comparable to standard offshore companies. But this similarity is not the same as equality. Every company in Hong Kong is subject to a yearly audit, regardless of whether it pays taxes. Companies in Hong Kong are subject to a tax system that is unique in its focus on the source of income.
A Hong Kong company may apply for tax exemption and pay zero percent tax if it does not have a Hong Kong-based headquarters or generate any income from the territory.
Since Hong Kong-based companies are no longer stigmatized as “offshore,” they have more access to a wider range of potential partners throughout the world.
As was previously mentioned, the local Hong Kong tax authority must approve a business’s request for tax exemption before it may register there. Offshore companies in Hong Kong are required to maintain extensive financial records and submit to annual audits in order to be eligible for the aforementioned tax exemption. Another no-go for a tax-exempt group: doing business with or selling goods and services in Hong Kong.
In the event that these conditions are not met, however, the company shall be held liable for the full payment of all taxes owed at a rate of 16.5%. Preparing verified invoices is a must for every Hong Kong company. The only way for other parties to see the books is for the shareholders to provide the information or for a judge to compel the books to be made public.
Another crucial point to note is that a business with no domestic investors may use whatever kind of financing it chooses. Non-Hong Kong residents are also given access to a unique financing system when they incorporate a business in the city. And remember, worldwide trademark registration services and other useful services can be provided by Fintech Harbor Consulting.
