Investing In Hong Kong

Why Should an Investor Prefer Hong Kong?

Strategic location

Some of the reasons why most foreign investors would prefer investing in Hong Kong include its geographical location and nearness to Mainland China. Geographically it gives ease of access across Asia and globally. Its proximity to mainland China is important as it ensures a large market base following the large Chinese population.

Government policies promotes businesses

The other reason why Hong Kong should be preferred is its government policies. The government of Hong Kong is continually campaigning for its growth both as a business hub and as a city. Some of the ways that the Hong Kong government strives to achieve these are through expansion for business activities and by encouraging and supporting innovation in various industries and business sectors.

No language barrier

Hong Kong is a separate and independent state from China. That implies that investors can feel welcomed, and English is one of the official languages that are used for communication purposes in the state, makes it even better for foreign investors and other business protocols, including the incorporation of your company.

A regulated jurisdiction

Hong Kong has regulated Jurisdiction; Hong Kong has an encouraging legal system and business culture that is welcoming to persons across various races and continents. The country has a relatively open mindset that is comparable to western culture. The trait is characterized by the open economy, free trade, general bureaucratic process, and intellectual property registration, among others.

Should I invest as an Individual or a Company?

Well, if you are stuck with this, let us first look at some of the benefits that a Hong Kong companies enjoy.

• Low tax rates
  The companies that are incorporated in Hong Kong have numerous benefits, including low taxation rates that will ensure that your obligation expenses are significantly reduced.
  Taxation is based on profits that are driven from the business operations but excluding those that are raised from the sales of capital assets. A single-tier corporate taxation system in Hong Kong is at a rate of 16.5%, while the unincorporated businesses are taxed at a rate of 15% of the taxable profits or income. On the other hand, personal income tax and salaries are also taxed at a relatively lower price. The personal income tax is charged from as low as 2% and might up to 17% for the income of above HKD 132,000.
• The ease of setting up a company
  Further, the process of registering a new company in Hong Kong is relatively easy and straightforward. Several options are available to the business owners to choose the right type of business that suits the investment that they are about to make.
• A slew of government support
  The other benefit that the Hong Kong government has for the companies in Hong Kong include incubator programs, grants, loans, and other financial support, including marketing funds. Hong Kong government gives companies special funding for technological and innovation ideas.
• Recognized trademark registration
  The other benefit is trademark registration. The trademark helps companies to be unique, thus making them stand out among their competitors and other business operations.
  Incorporating a company in Hong Kong increases your opportunity to receive additional funding from the government and other financial institutions. It would be quite difficult to approach a financial institution as an individual than it is as a company when outsourcing for more funds to expand your business operations. Therefore, when you have a growth plan, then the best idea will be to incorporate a company in Hong Kong as opposed to working as a person.

In as much as there are no limitations to operating a business in Hong Kong as an Individual, it is, however, better to consider these numerous advantages that running a company in Hong Kong provides. Nonetheless, there are certain professionals like law, tutoring, or medicine that will most likely require an individual’s input and not a company. In that case, there will be no pressure in registering and operating a company as long as the professional activities are well planned, and the operations are within the expectations of the Hong Kong laws.

What business Structure should I set up in Hong Kong?

As mentioned, the process of setting up a company in Hong Kong is relatively easy and straightforward. However, the type of business that you are planning to run will significantly depend on the needs and requirements of the business owner. It can be confusing and difficult to choose the best structure to set when you are just starting. The good news is Paul Hype Page can give you detailed and customized advice on the best business structure to start depending on the activities and operations of your business.

If you want to enjoy the maximum benefits that accompany setting up a business in Hong Kong, then the best business structure to set up is a Limited Liability Company. One of the advantages of setting this business entity is the fact that it can protect you from both Hong Kong and Mainland China lawsuits. All the members and shareholders of a limited liability company will only be liable for their capital contributions to the company.

What are the Possible Challenges when setting up a company in Hong Kong?

Just like there are benefits to setting up a company in Hong Kong, there are also some challenges that accompany the investments in the city sate. Some of these disadvantages include;

Conclusion

Generally, doing business in Hong Kong is becoming more lucrative day in day out, and the fact that the region is accessible from other Asian countries and international acts as an added advantage to its nearness to the Mainland China that provides a fantastic market base. It is evident that the benefits associated with setting up a company in Hong Kong overcome challenges as longs as proper advice and consultations are taken into consideration. Thus, if you are planning on starting a business in Hong, then you should incorporate a company as it has attractive benefits to operate as a company compared to if you invest as an individual.