Which jurisdiction to choose for starting a business in Asia: Hong Kong or Singapore
Asia is no longer the "periphery" of world business. Now this part of the world is being actively mastered by entrepreneurs and considered a promising and stable investment and business platform. Inside it, there are jurisdictions that offer favorable conditions for the registration of companies and even compete with each other for the right to work with large investors. What to choose a foreign entrepreneur: offshore Hong Kong or offshore Singapore, because at first glance they seem equally large, stable and promising.
Advantages and disadvantages of Singapore for starting a business
Singapore is an honorary member of the Association of Southeast Asian Nations, it gives entrepreneurs access to the markets of Australia, Malaysia, New Zealand and Indonesia and, according to world economic rankings, bypasses Hong Kong in the following positions:
- ease of doing business;
- ease of establishing business;
- trade openness.
Registering a firm and opening a corporate account with a local bank will cost between $5,000 and $20,000. The final price depends on the list of necessary documents to be certified by a notary, the presence or absence of nominal service, and the cost of mandatory services of an intermediary.
Jurisdictional taxation is based on the territorial principle, there is no capital gains tax at all, and profits received outside the state are not subject to mandatory fees either. An exception is the income from business activities returned to Singapore. Opening a bank account requires the personal presence of the owner. An offshore company in Singapore 2020 must have at least one local director and documents confirming payment of the share capital.
Advantages and disadvantages of Hong Kong for doing business
Hong Kong surpasses Singapore in economic performance and ease of tax payment. An undeniable advantage of the jurisdiction is its open communication with China and access to its largest markets. The procedure for registering a new firm and opening a bank account for it in Hong Kong is easier and cheaper than in Singapore.
It is possible to open a firm in the Hong Kong 2020 offshore by spending only 4,000 USD. Local staff is also cheaper, and nominal service is not prohibited. There are no taxes on capital gains, profits made outside the jurisdiction, interest and dividends. The disadvantages include the lack of independence, as in Singapore, and some unstable domestic socio-economic situation.
It is believed that Hong Kong is more suitable for entrepreneurs planning to develop in China, while Singapore targets other markets. But in general, these jurisdictions are equivalent. Every businessman makes a choice for him or herself, and the decision to register a company can only be made after a thorough analysis of its needs and objectives. IT-OFFSHORE company has reliable connections in Asia, our specialists will help you to choose the most suitable platform for business development and, if necessary, create a turnkey company.