How to open an offshore company in Hong Kong in 2021

Many businesspeople seek to open an offshore company in Hong Kong in 2021, because the jurisdiction is a major financial center, and the territory is considered respectable and attractive to entrepreneurship. To find out the nuances of registering a legal entity in Hong Kong, contact our experts at IT-OFFSHORE.

Advantages of incorporating a company

Registering an offshore company in Hong Kong in 2021 has many advantages. This jurisdiction is prestigious for conducting international business. There is an opportunity to optimize tax payments profitably, as the income tax rate is 16.5%, which is relatively low. New businesses can pay a preferential rate of 8.25%.

There is an opportunity to obtain offshore status if the company does not conduct business activities within the jurisdiction, in which case the tax rate can be reduced to 0%.

Other advantages of establishment are the following:

• Opening an offshore doesn't take much time;
• It is possible to open a company remotely;
• Only one director is required, no residency requirements;
• Open economy;
• The government supports foreign investors and entrepreneurs.

The area is characterized by a favorable location. In this regard, the area is often opened by international companies. Opening an offshore company in Hong Kong in 2021 gives the opportunity to get access to the Chinese market.

Features of opening a new company

Companies with limited liability are most often opened in the area. To open an organization, it is necessary to choose a name, which must be original and may be a Chinese or English one. 

It will be necessary to choose a secretary and determine the legal address. The presence of a real office is considered a prerequisite for the full operation of the firm. It is necessary to have a local telephone number. Even if the entrepreneur does not plan to conduct activities within Hong Kong, he/she is required to provide information about the office in the bank at the opening of an account. The phone number and address will be required for clients and partners.

Conditions regarding the availability of a secretary must be met. Will need to collect a package of documentation. Each shareholder and director is given a copy of a passport, proof of address. Contact information of all directors and shareholders is necessary, as well as information about the activities of the future company.

Subject to several conditions, the company can get offshore status and not pay income tax in Hong Kong. For this purpose, the business must have no customers from the territory and the real office in the jurisdiction, the goods must not pass through the area. All business transactions must take place outside the territory.

Nuances of taxation

Taxes are levied on a territorial basis. There are no fees to be paid when conducting business outside the territory. This is due to the fact that the source of income is located outside the area.

In Hong Kong, there is no VAT and there is no capital gains tax. The levy on income comes from dividends or interest. Income tax is levied only if the business is conducted within the territory. The levy rate is 16.5%.