Compliance of an offshore company in Hong Kong

Compliance of an offshore company in Hong Kong

To Register of Commerce must be submitted "The annual report" or should include details of directors, shareholders, secretaries and address of the registered office;
A company is required to submit a tax return and appear in the department of "The Inland Revenue each year.

Authorised and issued share capital
The authorized capital is usually HK $ 1.000. The minimum issued capital is one share of par value. The minimum paid and issued capital may be a single share which is fully paid.

Authorized shares
Shares may be issued with denominations, but BEARER SHARES ARE NOT AUTHORIZED;
Shares may be issued in one recognizable currency (HK $) or more;

Common shares, preferred shares, redeemable shares and shares with or without voting rights.

Taxation
Hong Kong is one of the few countries in the world where you tax the land. In Hong Kong profits tax is only charged on profits from a trade, profession or business carried on in Hong Kong. Therefore, this means that a company which carries on business in Hong Kong but derives profits from another place, is not required to pay tax in Hong Kong on those profits. The benefits that come from Hong Kong are currently subject to a tax rate of 16.5%. There is no tax in Hong Kong on capital gains, dividends and interest earned.

The principle of Hong Kong profits tax is that it is a tax on profits which has its source in Hong Kong rather than a tax based on residency. Income from elsewhere, even returned to Hong Kong is not subject to taxation in Hong Kong. Therefore, if the business activities of a Hong Kong company or business are based outside Hong Kong no taxation will be levied.

One factor that determines where the profits of trading in goods and commodities is generally the place where the contracts for the purchase or sale are completed. "Done" does not only mean that contracts are legally executed. It also covers the negotiation, conclusion and execution of contract terms.

Taxation agreements
Hong Kong has an arrangement with a number of jurisdictions to avoid double taxation of aviation and business income and others. It also has double taxation agreements with Belgium and Thailand, respectively, to relieve the tax on income, for example, dividends, interest and royalties. The Hong Kong Inland Revenue Department allows a deduction for foreign taxes paid on the basis of turnover in respect of that income is also subject to tax in Hong Kong. Therefore, companies operating in Hong Kong generally have no problems with double taxation of income.

Financial statements required
A Hong Kong company must keep a register of accounts, which may be kept at the registered office or elsewhere at the discretion of the directors. Any company must seek an auditor must be a member of the Society of Accountants in Hong Kong and hold a practicing certificate. Although there is no requirement to file accounts with the Registrar, there is a requirement to file accounts with the Hong Kong Inland Revenue ".

Directors
A director should be appointed to a minimum and there is no maximum number of director. It can be an individual or a corporation. Managers can be of any nationality, and should not be resident in Hong Kong. The directors and shareholders may be one and the same person. The executives of the company may be resident outside Hong Kong. The names and addresses (no residency requirement in Hong Kong) directors and shareholders are available on "public record".

General secretary
A Hong Kong company must appoint a secretary who may be an individual (who is a resident of Hong Kong) or a corporation.

Shareholders
It takes at least one shareholder. The directors and shareholders may be one and the same person. The names and addresses (no residency requirement in Hong Kong) directors and shareholders are available on "public record".