Hong Kong is located in the South China Sea 100 miles south east of Guangzhou (formerly known as
\nCanton). As of the 1st July 1997 under the Sino-British Agreement of December 1984 Hong Kong became
\na Special Administrative Region (HKSAR) of the People\u2019s Republic of China. The Basic Law, which is the
\nConstitution of the HKSAR, is intended to maintain the HKSAR and the PRC as separate governmental, legal
\nand economic systems. This is known as the \u201cOne Country, Two Systems\u201d concept. Hong Kong is governed
\nby a Chief Executive, an Executive Council and a Legislative Council. The Chief Executive is voted in by an
\nElection Committee of 1,200 individuals and members of the Executive Council are appointed by the Chief
\nExecutive. Half of the Legislative Council are elected by universal suffrage and the other half are indirectly
\nelected. The Basic Law states that the ultimate goal is for the Chief Executive and all of the Legislative
\nCouncil to be elected by universal suffrage but it remains to be seen when this will be implemented.<\/p>\n
The legal system of Hong Kong is based on the English Common Law supplemented by locally enacted
\nOrdinances. Under the Basic Law the UK court system and UK law, except that a local Court of Final Appeal
\nhas replaced the Privy Council in London, are guaranteed to remain in place for 50 years unless the matter
\nin question involves a threat to PRC national security. There is now a bilingual legal system with Ordinances
\nbeing translated into Chinese but English will continue to prevail. There is an excellent range of professional
\nservices available as Hong Kong serves as the major business centre for the whole of the Far East. This is
\nunlikely to change in the foreseeable future.<\/p>\n
The local currency is the Hong Kong Dollar which is freely interchangeable but has a pegged exchange rate
\nagainst the US Dollar – US$1 is worth HK$7.8. Hong Kong has no exchange controls and is consistently voted
\nas one of the easiest and most open places to do business.<\/p>\n
One of the major advantages of utilising a Hong Kong company is that there is no immediate suggestion
\nthat the company is a tax avoidance vehicle as Hong Kong is a major trading entity in its own right. It is the
\nworld\u2019s tenth largest importer and the world\u2019s twelfth largest exporter and a substantial sum of the Hong
\nKong companies incorporated annually are local trading companies doing real business in the region.
\nHong Kong has ratified 29 double taxation treaties and is negotiating a further 10 tax treaties.<\/p>\n
It is possible to create a Hong Kong registered corporate entity in two different ways:- (1) by incorporating
\na new Hong Kong company; (2) by registering an existing foreign company in Hong Kong under Part
\nXI of the Hong Kong Companies Ordinance. This latter procedure, although more expensive, can have
\nsubstantial advantages and these are summarised later.<\/p>\n
A company incorporated in Hong Kong has the following characteristics:-<\/p>\n
The rate of taxation is 16.5% on Hong Kong source income only. In practice this means that, with careful
\nstructuring, as long as a Hong Kong company is not actually doing business in Hong Kong it would normally
\nbe possible to arrange the affairs of the company so that no tax would be payable. Detailed advice on this
\naspect is available on request.<\/p>\n
A minimum of one shareholder is required whose details are filed on the public register. Corporate
\nshareholders are permitted and anonymity can be achieved by the use of nominee shareholders.<\/p>\n
A minimum of one director is required and full details must be filed with the Public Registry. Currently
\ncorporate directors are permitted but as of early 2014 a Hong Kong Company must appoint at least one
\nnatural person as a director. There is no requirement for board meetings to be held within Hong Kong and
\ndirectors may be resident anywhere in the world.
\nAs the director is legally responsible for compliance with the Hong Kong Companies Ordinance and the
\nInland Revenue Ordinance, in cases where we act as a director, an amount of US$2,500 (HK$20,000) will
\nhave to be deposited in order to guarantee such compliance. This amount may be returned when business
\noperations cease and the company has been wound up in the manner required by law.<\/p>\n
Hong Kong companies are required to file full audited accounts but small private companies meeting certain
\ncriteria may apply for \u201creporting exemption\u201d and prepare simplified accounts and simplified directors\u2019
\nreports. All Hong Kong companies must also prepare and file an annual return which gives details of the
\ncurrent directors and of the shareholders who have held shares in the company at any time during the year.<\/p>\n
Incorporation of a Hong Kong company normally takes about 5 working days but ready-made companies
\nare available for immediate use.<\/p>\n
Names which suggest any connection to the UK head of state are generally prohibited and certain words
\nwhich suggest specialist activity can only be used when the appropriate licenses have been obtained e.g.
\nbank, insurance company and other specialist financial enterprises.<\/p>\n
As a matter of local company law the company MUST maintain a registered office address within Hong
\nKong and must also appoint a Hong Kong resident to act as company secretary. The secretary cannot be the
\nsole director of the company. We would generally provide these services as part of the domiciliary service
\nfee.<\/p>\n
\nSchedule of Fees<\/h3>\n<\/td>\nIncorporation fee<\/td>\n | US$<\/td>\n | 750<\/td>\n<\/tr>\n | Courier fee<\/td>\n | US$<\/td>\n | 80<\/td>\n<\/tr>\n | <\/td>\n | <\/td>\n | <\/td>\n<\/tr>\n | Annually<\/strong><\/td>\n | <\/td>\n | <\/td>\n<\/tr>\n | Domiciliary services to include registered office,resident agent and company secretary<\/td>\n | US$<\/td>\n | 1500<\/td>\n<\/tr>\n | Business registration fee<\/td>\n | US$<\/td>\n | 295<\/td>\n<\/tr>\n | Annual government filing fee<\/td>\n | US$<\/td>\n | 15<\/td>\n<\/tr>\n | Provision of director and\/or shareholder and HK office remail<\/td>\n | US$<\/td>\n | 4000<\/td>\n<\/tr>\n | Compliance fee<\/td>\n | US$<\/td>\n | 150<\/td>\n<\/tr>\n | \n | TOTAL FIRST YEAR\u2019S FEES<\/strong><\/h5>\n<\/td>\n6790<\/strong><\/td>\n<\/tr>\n | \n | SECOND AND SUBSEQUENT YEARS\u2019 FEES<\/strong><\/h5>\n<\/td>\n5960<\/strong><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n | For holding companies, the directors fee can be discounted to a minimum of $2,500. OPTIONAL SERVICES<\/h4>\n |
As can be seen from the section entitled \u201cAnnual Reporting\u201d a Hong Kong company must prepare accounts
\n(audited in the case of a Hong Kong incorporated company and unaudited for the Part XI company) giving
\ndetails of all transactions undertaken during the accounting year whether these produce Hong Kong source
\nincome or not. Additionally, both types of company will be required to submit various reports to the Hong
\nKong Inland Revenue including a \u201cProfits Tax Return\u201d and an \u201cEmployers Return of Remunerations and
\nPensions\u201d. All these reports must be made in a timely fashion if penalties are not to be visited upon the
\ncompany for late filing. For this reason we offer to act as the \u201cFiscal Agent\u201d for your company and assist in
\ncompleting and filing the necessary returns, assisting with the preparation of the company accounts and
\nliaising with the company auditors and the tax department to ensure that the financial obligations of the
\ncompany are met in a full and timely fashion. For the provision of this service we charge from US$500 per
\nannum.<\/p>\n
Most onshore countries have provisions within their tax legislation whereby any company, no matter where
\nit is incorporated, which is managed or controlled from within their jurisdiction will be tax resident there
\nand taxable on its worldwide income at local rates. For example, any offshore company which had UK
\nbased directors would be tax resident in the UK and subject to UK tax on its worldwide income. Failure
\nby the directors to declare the liability of the offshore company to UK tax would be an offence under UK
\nlaw with potentially very serious financial and criminal consequences. Most onshore countries have similar
\nprovisions within their tax legislation so it will rarely be advisable for onshore resident clients to act as the
\ndirectors of an offshore company. To establish that the management and control of the company does take
\nplace offshore and the company is therefore tax resident offshore as well as incorporated there we can,
\nand habitually do, provide directors. In most cases this service is essential if legitimate tax savings are to be
\nmade. Fees for the provision of management services are included above. If you require this service please
\ntick the appropriate box in the application form.<\/p>\n
We can assist with the opening of bank accounts for the company in most places in the world and our fees
\nfor attending to the account opening procedures would be from US$1,000 plus the costs of preparing any
\nadditional notarised documentation which a particular bank may require.<\/p>\n
As part of the domiciliary services package we provide a registered office address in the jurisdiction of the
\nincorporation of your company in order to meet the local statutory requirement. An additional service is the
\nprovision of an address, telephone and fax number to receive correspondence which can be the same as the
\nregistered office address or another of our Group offices\u2019 addresses. When we receive communications we
\nwill deal with them according to your wishes. Fees for the provision of this service are included above plus
\nhandling charges (US$3 per item plus disbursements). If you require this service please tick the appropriate
\nbox in the application form.<\/p>\n
For those companies which are particularly active or wish to have a higher profile or more substance we can
\narrange the immediate allocation of a dedicated telephone line answered with the name of your company.
\nAdditional costs apply to this service.<\/p>\n
Using a trust to own the shares of an offshore company can result in very substantial tax and non-tax related
\nadvantages which will accrue both on death and during the lifetime of the trust settlor. These advantages
\nmay be summarised as follows:-
\n(1) Saving on Inheritance Tax: On death, the inheritance tax which would normally be assessed on the value
\nof the shares would generally be eradicated.
\n(2) Asset Protection: Assets placed into trust are generally beyond the reach of creditors who might arise as
\na result of financial difficulties, divorce proceedings, litigation etc.
\n(3) Avoidance of Probate: A trust provides a means whereby assets can be smoothly passed on to the
\nnext generation without the disruption, delays, substantial costs, loss of confidentiality associated with the
\nprobate procedure which necessarily follows when assets are bequeathed by will.
\n(4) Continuity: Trusts provide a means whereby assets can continue to be administered in accordance with
\nthe wishes of the settlor after his death so the weak can be protected from others and the spendthrift can
\nbe protected from himself.
\n(5) Lifetime Tax Savings: During lifetime, substantial income and capital gains tax advantages may result
\nfrom setting up the trust.<\/p>\n
Trust services can be provided by our licensed trust corporations in Gibraltar, Guernsey, the Isle of Man,
\nSingapore and the Turks & Caicos Islands through our various Group offices. Fees for drafting the trust deed
\nand for the provision of trustee services will be quoted on a case by case basis.<\/p>\n","protected":false},"excerpt":{"rendered":"
Synopsis Hong Kong is located in the South China Sea 100 miles south east of Guangzhou (formerly known as Canton). As of the 1st July 1997 [\u2026]<\/span><\/p>\n","protected":false},"author":9,"featured_media":0,"parent":3329,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"_exactmetrics_skip_tracking":false,"footnotes":""},"class_list":["post-3551","page","type-page","status-publish","hentry"],"yoast_head":"\n