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30 Q&A About Tax and Registered Capital of a Hong Kong Company

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1.Q: what is the tax requirement for Hong Kong companies?

A: Hong Kong is a free port with less tax and low tax rate. Enterprises only need to pay a tax so-called profits tax every year, profits tax is in accordance with the enterprise income, that is calculated at 16.5% of pure profit. For example, the annual turnover of a company is 10 million HKD, gross profit is 2 million HKD, and net profit is 1 million HKD. The company should give the government the profits tax is 1 million HKD X16.5%=165000 HKD. If the enterprise does not have profit, the enterprise does not need to pay taxes.

30 Q&A About Tax and Registered Capital of a Hong Kong Company

2.Q: how is the tax rate calculated for Hong Kong companies? How does the specific tax return time define?

A: The tax rate in Hong Kong is calculated at 16.5% of the actual profit. It is customary for Hong Kong companies to close the financial year on 31 March each year. You can defer your tax return by one year.

3.Q: Hong Kong import products are dutiable?

A: In addition to tobacco, general import goods in Hong Kong is not need to pay taxes. But all the import and export of goods should be declared to customs, the customs clearance fee is charged at 0.5% of the actual price (less than HKD47000 yuan) and 0.3% (more than HKD47000).

4.Q: What taxes do you have to pay when you start a company?

A: You must pay a registered capital stamp tax when you set up a Hong Kong company. The registered capital stamp tax is charged at 1 / 1000 of registered capital. For example, if the registered capital is 1 million yuan, then you should tax 1000 Yuan.

5.Q: Which department is responsible for the invoice receipts of Hong Kong companies?

A: invoice receipts for Hong Kong companies are not uniformly printed by the Inland Revenue Department, but by the Board of Directors according to the nature of the company's business. Invoice receipts and other documents shall be effective as soon as they are stamped with the company's seal and signed by the person in charge.

6.Q: How will the company's accounting accounts, audit, and tax returns be handled each year?

A: We can directly act on your behalf. We will be able to handle accounting, audit,tax returns and so on when you provide us with the data. The cost will be determined according to the actual amount of work, but we will not start the work until the two parties agree to charge the amount, and there will not be any situation where the account will be recorded without your consent.

7.Q: What is the tax system in Hong Kong?

A: Hong Kong's revenue is divided into three main categories: property tax, salaries tax, and profits tax. The property tax rate is calculated on the basis of 16.5 percent of rental income from property ownership. Salaries tax is calculated at a progressive rate based on salary income, with negative tax ceilings not exceeding 16.5 percent of total salary income. The corporate profits tax rate is 16.5 percent of the taxable profits of the company. Taxable profit refers to the profits earned by the company managing and operating in Hong Kong. Because of many mainland customers’ Hong Kong companies do not operate in Hong Kong (for example, they do not have offices, office buildings or recruitment staff in Hong Kong), thus it is not necessary to pay the profits tax in Hong Kong. Please note that the amount of money in the local bank account and the registered address in Hong Kong that is not equivalent to the managing and operating of Hong Kong.

8.Q: What does registered capital represent?

A: Registered capital has the following significance:
1) Hong Kong company's highest fund-raising capacity: a Hong Kong company can raise funds by issuing shares to shareholders or investors, and the more registered capital means that the more capital the company can raise. In addition to issuing shares, the company may obtain funds through advance expenditure from directors or loans from banks, which generally require collateral of assets or private guarantees by directors.
2) shareholder's maximum liability: if the company is wound up, the shareholder's liability shall be limited to the unpaid share capital.

30 Q&A About Tax and Registered Capital of a Hong Kong Company

9.Q: how much should the registered capital be?

A: The registered capital represents the ability of the company to raise funds and amount of shareholders' investment depends on it. In addition, the registered capital is also regarded as the shareholders of the company's commitment, the more registered capital, the third party has more confidence in the company. In the case of Private Companies, registered capital of HK$10000 should be sufficient.

10.Q: What is the capital gain tax?

A: The Hong Kong government will impose a 0.1% capital gain tax, that is per HK$1000 registered capital will impose a capital gain tax HK$1.00, up to HK$30000.

11.Q: if the capital gain tax is included in the fee for a registered Hong Kong company?

A: The service charge charged by our company for registered Hong Kong companies already includes the HK$10000 registered capital tax. If the registered capital exceeds HK10000, you will be required to pay an additional tax of 0.1%. For example, the proposed registered capital is HK 100 000 and the additional capital gain tax is HK$90, that is, 1 000 00 x 0 1. 1% -10. 5%.

12.Q: Can Hong Kong companies increase their registered capital after their establishment?

A: Yes, you can increase your registered capital at will. However, you must recruit the shareholders' general meeting, and pass the resolution to increase the registered capital, then submit the resolution to the Hong Kong companies Registry together with the completed form and the appropriate fee.

13.Q: Our Hong Kong company has just been established, can we directly handle a foreign joint venture or a sole proprietorship in the mainland of China?

A: Generally speaking, if a foreign investor wants to invest in China, the foreign company can directly handle a foreign joint venture or a sole proprietorship. But the office must be established for more than a year.

14.Q: how long does it take to start a new company? How long would it take to buy an off-the-shelf shell company? Can I buy it now and change my name? How long does it take to change the company’s name?

A: A new Hong Kong company can be completed within 8 working days after signing all statutory documents. Purchasing a ready-made company can be completed in 3-4 working days, and urgent order can be done in 1-2 days. After purchasing, you can change the company name and shareholders, it takes 7 working days to change the name of the company and only 2 working days for the change of the company's shareholders.

15.Q: How to solve the daily work of Hong Kong companies, such as tax returns? May I entrust it to you? What's the annual cost?

A: As far as Hong Kong tax is concerned, it is reported only once a year. The question of how to charge is based on the actual situation of your company. Accounting audits must be paid, and fees are determined by turnover and the size of the bill. If we do not have the business, there will be no charges in this respect.

16.Q: How is the tax rate calculated for Hong Kong companies? How does the specific tax return time define?

A: The tax rate in Hong Kong is currently calculated at 16.5% of the actual profit. The Hong Kong Companies Ordinance requires tax returns to the Inland Revenue Department (IRD) in October each year. The tax payable to the Inland Revenue Department (IRD) is due on 31 March each year. A new company may pay tax after 18 months.

17.Q: which department is responsible for the invoice receipts of Hong Kong companies?

A: Invoice receipts for Hong Kong companies are not uniformly printed by the Inland Revenue Department, but by the Board of Directors according to the nature of the company's business. Invoice receipts and other documents shall be effective as soon as they are stamped with the company's seal and signed by the person in charge.

18.Q: What support does the Hong Kong Government have if our annual export quota for Hong Kong companies is in the tens of millions of US dollars? How can I obtain the relevant documents for free access to and from Hong Kong?

A: The Hong Kong Government and the Hong Kong Bank now have some schemes to support small and medium-sized companies. If you meet the criteria, you can get their help. Hong Kong is now learning from the United States, people with money and knowledge who can help and contribute to Hong Kong's economy will be considered for absorption. For access to Hong Kong and Macao documents, it is recommended that you apply to the local public security department of your registered permanent residence.

19.Q: How can I legally publish a book after we set up a publishing house?

A: After the establishment of the publishing house, you have obtained the qualification to handle the issue of the book. However, you have two more things to do: first, apply for International Standard Book Number or International Standard. The second is to apply for the issue number before the book is issued. If the two aspects work well, then you can legally publish a book.

30 Q&A About Tax and Registered Capital of a Hong Kong Company

20.What do you mean by ISSN an ISSN? what's the difference between ISBN and ISSN?

A: ISBN means an international standard book number. ISSN is the meaning of the international standard serial number. With these numbers, our books and periodicals have reached international standards. The fundamental difference between ISBN and ISSN international organizations is that the object is different. The former is for book publishers; the latter is for journal publishers.

21.Q: What are the requirements for a limited company registered in Hongkong?

A: A shareholder and director aged 18 or above who is Chinese resident or overseas person holding a passport or identity card may register a Hong Kong Limited. In addition, a Hong Kong address must be provided as a registered address and a Hong Kong resident or a professional company shall be appointed as the statutory secretary of the company.

22.Q: Can mainland residents register Hong Kong companies?

A: Yes. The company law of Hongkong has no restrictions on the nationality of shareholders/directors.

23.Q: How long does it take to register a Hong Kong company?

A: Ten working days.

24.Q: Is the business registration certificate required to fill in the nature of the business?

A: Not necessarily. If the company does not want to specify, you don’t need to fill in.

25.Q: Will the scope of business registration certificates restrict companies from expanding other businesses?

A: Business scope generally means the company's main business, business registration certificate does not limit the business scope of the company, so it will not restrict the company to expand other business.

26.Q: How do you know if the company is legally registered?

A: We may be entrusted with the search or at the Hong Kong Companies Registry. In addition, if the bank is willing to open an account for the company, it is sufficient proof of the legitimacy of the company.

27.Q: How many directors can be appointed when purchasing shell companies?

A: 1-50 directors can be appointed.

28.Q: When the public can check the information of a Hong Kong company?
A: Sixteen working days from the date of registration.

29.Q: How many directors can be appointed to a Hong Kong limited company?

A: 1-50 directors can be appointed.

30.Q: Is the liability of a limited company based on registration or on the issue of shares?

A: A limited company need undertake debt liability by issuing share, and need not undertake debt liability by unissued share.

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