The benefits of Hong Kong business formation are too many and too good to ignore. The new business entrepreneur needs to understand and appreciate these benefits of company formation in Hong Kong. It should be borne in mind that company formation requires careful consideration by the business owners. It is a decision that should not be taken lightly.
How to incorporate in Hong Kong? Several issues need to be addressed before business registration and company formation. Questions such as whether the business is eligible for a license should be answered comprehensively. The rules governing the working of the Commercial Transaction Office, or CTRO, should be reviewed, and a clear view of the guidelines regarding the opening of an account should be clarified. All relevant documentation should be gathered and examined. The business owner should answer any question put to him by his lawyer without having to hesitate.
The benefits of Hong Kong company formation are the absence of any taxes in comparison to other countries. Business owners need to understand and appreciate this and note that tax payments are an essential part of being a business owner. Therefore, it is necessary to know how to incorporate Hong Kong and pay the appropriate taxes.
Companies in Hong Kong must pay a registration fee of $8,500. It is a small cost when compared with the annual registration fees of other countries. Another price that must be paid is the SAR fee, or Standard Assessment Fee, which the company pays to assess its status. The amount of tax paid will depend on the type of business of the company.
Whether an individual or a company, one must comply with the local laws in Hong Kong. Most importantly, this means ensuring compliance with the Basic Principles of the Law of Hong Kong. These include the rules on land and its ownership and its taxation. There are also rules on the transfer of land and its profits and whether these profits must be taxed.
When registering a company, there are essential things to consider. First, one must decide the name of the company. The company’s name is not of any significance except that it is the company’s distinctive identity. Next, one must determine the purpose of the company. It is essential as the aim of the company is to carry on business. Finally, one must choose the location where the business will run.
If you have a simple business without any employees or offices in Hong Kong, it would be most appropriate for you to start small. The easiest way for you to get started with your business is by registering a Limited Liability Company. It is the easiest way for you to establish your business and come up with a working budget. Also, it gives room for you to come up with an appropriate business structure. Ultimately, this is important as it allows you to have an idea of how to incorporate it in Hong Kong.
However, if you have a large business such as those having many employees, offices, and even warehouses in Hong Kong, you should register a corporation. The advantages of incorporating a company are that it simplifies matters on the tax aspect, and it also provides a legal shield against personal liabilities incurred while doing business. Furthermore, incorporating a company even allows you to protect your goodwill from being stolen. Finally, combining a company also provides for more accountability and transparency in the running of the business. All you must do is choose the type of company registration you prefer and then follow the necessary steps.