Hong Kong has a separate legal system from mainland China, and it has its legislative framework and judiciary independent of that of the Chinese government. This article highlights the basic business laws of Hong Kong, including the legal environment, business laws and regulations, business structures, legal framework, and taxation.
Hong Kong has laid down laws and regulations governing the business operations within its territories. The Companies Amendment Ordinance started its operation on February 1, 2019. The amendment seeks to expand the scope for reporting and reflecting on the latest accounting standards.
Hong Kong is open to trade and has an open door for policy trading. It thus implies that Hong Kong does not charge tariffs on the exporting or importing of goods. Besides, the importation and exportation licensing in Hong Kong are kept at a minimum rate.
The labour legislation of Hong Kong is in-line with those of the international laws, and it has implemented several conventions from the International Labor Organization. The labour law has facilitated the entry of highly skilled financial professionals into the Hong Kong job market.
The main reason many foreign businesses comes to Hong Kong. It is low and there is zero tax on profits earned overseas for Hong Kong based businesses. Tthe taxation system of Hong Kong is simpler and clearer to help both foreign and local investors operate with ease. Some of the reasons why the Hong Kong business taxation system is simpler is the fact that there are no capital gains tax, no VAT, no taxation on dividends, estate duty and inheritance is not subjected to taxation. Furthermore, there are no payroll taxes and profits that are derived outside of Hong Kong. Nonetheless, the following are taxed: salaries, gains, property, and stamp duty.
Annual compliance refers to the yearly procedures required to maintain your financial records with the Hong Kong government. This includes statutory returns, annual general meetings and associated minutes, as well as ensuring your personnel records are updated with the Registrar of Companies.
Navigating the taxation regulations and maintaining annual compliance in Hong Kong requires experience and familiarity with the inner workings of the complex system. Fortunately, Paul Hype Page has an established presence working in Hong Kong as accountants, and we will assist your business in ensuring you fulfill the requirements of doing business in Hong Kong.
The solutions we offer for companies and their owners cover important areas such as incorporation, taxation, auditing, and work visas, among others.
We are always ready and willing to work with any genuine and legitimate company which requires our incorporation services or any other services we provide.
We offer company incorporation, consultancy services, auditing, taxation, immigration & compliance services.
The Stamp Duty Ordinance (Cap. 117) imposes a duty on specific documents including:
conveyance on sale,
agreement on the sale of a property like a residential property,
leasing of immovable property like tenancy agreement, and
transfer of documents on Hong Kong stocks.
Stamp Duty can be difficult to understand if you are not a professional corporate secretary. Rather than spending years learning the regulation, you can instead have Paul Hype Page, a qualified advisor, handle the documentation and help you through the process.
Independent Commission against Corruption (ICAC)
As an international business hub, Hong Kong has strict rules against corruption. It is one of the countries places where one can opt to do business. The ICAC uses several means to fight corruption, including the passing of new laws and educating the public. Examples include new anti-money laundering (AML) processes and other restrictions. While the ICAC does a good job at preventing corruption, their efforts can make it difficult for legitimate companies to conduct business.
One way it is more difficult to conduct business in Hong Kong is in regard to bank account openings. It is harder for foreign companies to open bank accounts even if they are genuine.
Fortunately, Paul Hype Page has built professional relationships with banks in the region, and we are able to ensure a successful application. We are able to assist your business at any point from pre incorporation to post incorporation.