Private Limited Company – the companies with limited liability which are used for a tax mitigation. The company in Hong Kong may not issue shares to the bearer.
The minimum number of directors and shareholders is one director and one shareholder who can be both individual person and legal entity, resident or non-resident. Director and shareholder can be one and the same person. Also the obligatory condition is the appointment of a secretary who may be an individual person located in Hong Kong or a legal entity registered in this country.
There aren’t requirements on the size and on the mandatory payment of the authorized capital of the company of Hong Kong.
Proposed authorized capital is HK$ 10 000 (Hong Kong dollar) which is divided into 10 000 shares with par value of HK$ 1.
Taxation of the companies of Hong Kong is due to the territorial principle. Under applicable laws of Hong Kong the income of companies which conduct its activities outside Hong Kong, are not subject to tax deductions. The Hong Kong tax authorities accept the decision to release the companies from taxes on the basis of assessment of the company's activities. If the company of Hong Kong has corporate income in this country's territory, the company is obliged to pay profit tax of 16,5 %.
Accounting and audit.
The existing companies should annually provide the following certified documents by the licensed auditor to the tax authorities:
- Financial Statements.
- Auditor’s Report.
- Profit Tax Return.
An audit is not required for dormant companies in this case the directors have to make a special statement.
Information about the directors and shareholders is publicly available in the register of companies.
- Simple tax system: there is a single tax on profits in case if the company has corporate income inside Hong Kong;
- Private Limited Company may be used for international trade, especially for trading operations in Asia.
- It’s necessary to prepare and submit annually a financial statement.
- Each Hong Kong company must have a resident secretary.
There is also the possibility of a bank account opening with the obligatory attendance in the following banks of Hong Kong: