Getting started: Setting up a business
Reasons to start a company in Hong Kong
There are many reasons why it is advantageous for foreigners to start a business in Hong Kong. Foreigners should start a business there so that they can take advantage of following key benefits of incorporating a company in Hong Kong:
- Low cost of company incorporation and preservation
- Lack of capital gain tax
- Lack of requirements with regard to share capital
- Clear and consistent regulations for appointments of directors and secretaries
- Due to the fact that Hong Kong is one of the world’s leading trade locations, the incorporation of a Hong Kong company is likely to be viewed by the relevant authorities as “legitimate” and therefore less likely to be seen as a tax avoidance vehicle
- Language is an advantage for many foreigners who live in Hong Kong. English is an official language and used as a main business language. All the information related to reporting and documentation can be found in English
- The tax procedures of Hong Kong are trouble-free and its regulations are clear-cut
- For the formation of a limited liability company, only one director and shareholder is needed.
- Hong Kong can boast of an excellent banking system and world-class communications infrastructure
Hong Kong economy is governed under positive non-interventionism and is highly dependent on international trade and finance. For this reason, it is regarded as one of the most favorable places to start a company. Among the top reasons on why starting a a business in Hong Kong include:
Easy Business Setup
China does not only welcome foreign business owners to develop businesses in Hong Kong but also provides them with the tools to grow successfully with minimal stress in the company registration process – a commodity that is not easily offered to foreigners in many countries.
Solid Infrastructure Facility
Hong Kong is an ideal location in the heart of the Asia-Pacific region, with its air and sea transport facilities providing world class service in terms of shipping, logistics and freight forwarding services, topped by its advanced telecommunication infrastructure allowing cost effective prices for frequent travelers.
Simple Tax System
Hong Kong charges some of the lowest tax rates worldwide thus permitting maximum earnings at minimal costs.
Fair and Transparent Legal System
Hong Kong’s legal system leans to favor business environment by providing fair business surroundings at all times.
Hong Kong’s free trade policy, no trade barriers and no limit for foreign onshore and offshore investments as well as no tariff quotas or fees for general import and export trade make it one of the world’s most liberal economic systems with the sky being the limit for trade and earnings from trade.
Geographical location Hong Kong’s geographical location opens it to the surrounding markets of which China and Singapore are part.
The infrastructures of Hong Kong such as the airports, railways, and telecommunication are of a world-class standard.
Because of Hong Kong’s beautiful sceneries, many people are traveling to this region as tourists. Hence, businesses related to this area or serving these groups’ needs, are very lucrative.
Diverse business sectors
There are diverse business sectors in Hong Kong from which one can choose to engage in such healthcare, information technology, information, data analysis, financial institution, financial technology, education, and hardware.
The banking facilities in Hong Kong are of world-class standards. They offer their clients the ability to transact in different currencies.
The dynamic Hong Kong economic growth
There is economic freedom in Hong Kong mainly because of its strong legal system, efficient regulatory system; friendly economic policies, and strong laws against property rights infringement.
Friendly tax rates
Hong Kong is considered a tax haven because of its friendly tax rates. It is one of the lowest tax regimes in the region in terms of property tax, corporate tax, and profit tax rates.
Government policies and initiatives
The Hong Kong government understands the important contribution that businesses at the local or international level provide to its economy. It, therefore, has friendly policies and initiatives aimed at promoting the flourishing of the Gross Domestic Product (GDP). The government of Hong Kong allows foreign investors to own 100% of their company. It also offers business support to both local and foreign investors.
The Hong Kong government also has special initiatives aimed at attracting many foreigners to the region’s business sector such as incubator programs and funding schemes.