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Setup Business outside India

HongKong

Overview

Hong kong is pondered to be one of the most business-friendly pursuant to low tax rates in Asia. It is the global leader in the banking and business and is one of the least corrupt country in the World. Complying with the basic requirements in Honk Kong, foreigners have been attracted to the country due to the minimum tax rates and the exemptions it provides to offshore companies.

Benefits of setting up in HongKong
  • Formation of entities with distinct identity and can be setup as an offshore as well as resident company;
  • Allows 100% foreign ownership and ease in transfer of ownership;
  • Charges lowest corporate tax from resident company;
  • Charges nil tax rate from offshore company;
  • Provides ease of doing business;
  • Country is itself a free economic zone (as it is part of China known as the Hong kong Special Administrative Region);
  • Least corrupted

Types of entities in HongKong

Limited Liability Corporation (LLC)
  • Hong Kong provides two types of limited liability companies, one being public and the other being private. Further, a private limited liability company can be categorized on the basis of resident and non-resident. Where in case majority directors reside in Hong Kong, the private limited liability company is deemed to be a resident company.
  • In case of non-resident private limited liability company, one director and one shareholder suffice the requirement, which are not required to be resident in Hong Kong. This type of entity does not require any minimum capital contribution and government approval. It is mandated to appoint one company secretary who shall be resident in Hong Kong.
  • Further, a resident private limited company can only have maximum 50 shareholders and has restrictions on the right to transfer its shares, whereas the number of shareholders can be more than fifty members in a public limited company and capital can be raised by offering shares and debentures to the public.
  • Both public and private limited company is a type of entity, which has a separate legal identity and involves limited liability of its shareholders and directors.
  • LLCs are also required to have a registered office and open a bank account in Hong Kong.
  • Corporate tax in case of LLCs is at a flat rate on 16.5%, unless offshore company complies tax-exempt requirements.
Branch Office
  • A branch office can be setup in Hong Kong by a foreign entity as its extension and the mere purpose is to facilitate operation and generate revenue in the country, any negative or positive financial impact is directly attributable to the parent company;
  • It requires having only one resident company secretary and a registered office and no minimum capital or representative residing in Hong Kong.
Representative Office
  • A representative office can be setup by a foreign company to assess and research business opportunities in Hong Kong but cannot engage in any revenue generating activity.
  • It requires having only one local agent/ distributor and a registered office but no minimum share capital.
Comparison of entities in HongKong
Limited Liability Corporation (LLC) Branch Office Representative Office
Legal Status Separate Legal Entity No separate identity No separate identity
Limited Liability Yes No No
Minimum Capital US $1 None None
Limit of shareholders/ partners Minimum 1 Parent Company Parent Company
Requirement of Director/ Manager Minimum 1 1 Resident Agent 1 Resident Representative
Requirement of Company Secretary 1 Company Secretary 1 Company Secretary N.A
Registered Office Address Mandatory Mandatory Mandatory
Opening of Bank Account Mandatory Mandatory Mandatory

Services offered by CorpAcumen Global

We at CorpAcumen Global assist you in identifying best suitable entity considering the goals of your businessand thereafter initiate the setting up process

  • Submit incorporation documents with the authorities in the preferred state
  • Provide registered office and local company secretary
  • Post incorporation, assist in opening of bank account with suitable banker
  • Obtain necessary licenses for the type of business
  • Provide services pertaining to accounting and taxation
  • Ensure continual compliances post incorporation, both event as well as annual based