Table of Contents
Introduction
You’re not the only one who might want to expand your business to Hong Kong. Many foreign investors have chosen to invest in this market because it is attractive. They want to try out the Asian market or look for new opportunities.
We at DDPHK, as always, try to help you understand how to start a business in Hong Kong. Here’s a complete framework for starting a business in Hong Kong, with clear, valuable steps to follow to make your start-up there a success.
Why is it an opportunity to start a business in Hong Kong
Hong Kong ranks sixth on the World Economic Forum’s Competitiveness Index because it is a top financial hub for many startups. Hong Kong is also run by a well-known, well-regulated international government where the economy is flourishing.
It may be easier to start a business in Hong Kong compared to many other cities worldwide. But people from different countries who want to start a business in Hong Kong shouldn’t underestimate the difficulties they may face.
Growth of Economy Hong Kong
Hong Kong’s economy is strong, which is the main reason you should start a business there.
The economic freedom of this country is the best in the region and the world as a whole.
The government has the economy as a first policy priority.
They always try to keep the laws of trade clear and transparent and the regulatory systems effective.
The open market of Hong Kong is always a good opportunity for every business in Hong Kong to grow naturally and with the least possible difficulty.
And property security rights are very reserved in Hong Kong.
Potential to invest in many different fields
So, many new businesses have started in Hong Kong, which helps the economy of this area. The growing business fields in Hong Kong are:
- Online retail
- Electronic equipments
- Money and Finance
- offering specific professional services
- Medicine and health services
- Teaching and education
The Advantage of the location of Hong Kong
Hong Kong is in Central Asia, so it gives businesses access to many markets for trade, especially mainland China. One of the essential reasons investors are willing to participate in Hong Kong is that it is in a strategic location. Investors with access to a wide range of markets, like those in Hong Kong, are always ready to grow their businesses in Hong Kong.
Less worry about Taxes
Hong Kong’s corporate tax rate is low compared to most other countries. There is no VAT or sales tax on dividends in this country. Hong Kong has a 16.5% tax on profits, a 15% tax on property, and a 15% tax on salaries. One of the main reasons they place their business in Hong Kong is because the government there has low tax rates.
Different types of Hong Kong Businesses
Your startup’s structure should be based on the needs and demands of your business in Hong Kong. How you manage your business and how you pay income tax for your corporation are all affected by how the company is set up. If you intend to know what the best business structure for a company is, you can think about the following:
- Unlimited Business
- Limited Company
- Branch Offices
- Office of the Representative
How to Get Your Business Started in Hong Kong
The process of registering a business in Hong Kong isn’t hard, but it can take a while. Our team can cut down on time it takes because they have a lot of experience making sure the company name is unique, filling out the application (so it doesn’t get turned down), opening the proper local bank account, etc.
The steps in the process of registering a business in Hong Kong are as follows:
choose a name for your company
The name can be proposed in English, Chinese, or both. You have to be careful when choosing a name for your limited company or business in Hong Kong because you can’t use a name that someone else has used before or is using.
register your business
Because it has so many benefits, most entrepreneurs in Hong Kong choose to register and incorporate their businesses as limited companies. Limited companies are their own legal entities, and they can protect personal assets from related risks. Also, transferring ownership and getting money or capital for limited companies is easier than it is for other types of business groups.
open a local bank account for your company
Getting access to financial services is the most important thing you should do if you want to start funding your projects.
hire staff
Every business that starts up in Hong Kong needs people. Depending on your business in Hong Kong needs, you must hire staff members of the correct number to meet your business needs. If you are new to Hong Kong, it can be hard to find a job. You might not know where to start or if the people you hire have the right skills.
pay taxes
Once your business is up and running, you must pay taxes and give the government an annual financial report. You can hire an auditor to help you file tax returns and improve how your business runs as a whole. This will help you save money on costs that aren’t necessary.
conclusion
In this article, we discussed the most important parts of starting a new business in Hong Kong. You must make sure to follow the rules and laws. This includes setting up finances, opening a business bank account, taking care of pensions and insurance, and filing an annual return to avoid legal problems.
What are the business taxes in hong kong?
Hong Kong is a tax haven and it is the only place in Asia where there are no taxes. However, this comes with its own set of problems.
In Hong Kong, there are different types of taxes that companies have to pay. These include:
– Business tax- Income tax- Capital gains tax- Stamp duty- Estate duty- Stamp duty land tax- Value added tax (VAT)
what are different types of businesses in Hong Kong?
Unlimited Business-Limited Company-Branch Offices-Office of the Representative
what are the poular business fields in Hong Kong?
Online retail-Electronic equipments-Money and Finance-offering specific-professional services