Hong Kong Company Formation (Procedures)

Transcription

1 Hong Kong Company Formation (Procedures) The Companies Registry is responsible for providing services to incorporate local companies with or without limited liability and register non-hong Kong companies; register documentation required by the various Ordinances administered by the department, principally the Companies Ordinance; providing the public with services to inspect and obtain information held by the department on the various statutory registers, current data of companies incorporated and registered with the department and image records of registered documents; deregistering defunct solvent companies as well as ensuring compliance by companies and their officers with their obligations under the relevant Ordinances. No. of Days Shelf Company E-Registration Paper form Select Company name from our list of companies and confirm payment of our fees Select Your Own Company Name and confirm payment of our fees Select Your Own Company Name and confirm payment of our fees Day-1 - Resignation of Director - Resignation of Company Secretary - Change of Registered office - Appointment of New Director - Share Transfer from Founder Member - Certificate of Incorporation - Business Registration Certificate - Appointment of Director - Share Transfer from Founder Member (UGA LIMITED) - Certificate of Incorporation - Business Registration Certificate - Articles of Association - Incorporation Forms - Business Registration Certificate Day-2 Day 6 or 7 Ready Company Kit with Company Rubber Chop, Common Seal etc., READY FOR BANK ACCOUNT OPENING Ready Company Kit with Company Rubber Chop, Common Seal etc., READY FOR BANK ACCOUNT OPENING Ready Company Kit with Company Rubber Chop, Common Seal etc., READY FOR BANK ACCOUNT OPENING

2 HONG KONG COMPANY FORMATION (HK$ 9,300) There are 2 ways of forming a limited company in Hong Kong: 1) Setting up a whole new company In this you can specify your preferred company name, but the registration process time is relatively longer. 2) Purchasing a ready-made company (or named shelf company) In this you have to select your company name from a given list which includes never-used shelf company names, but the processing time will be shorter. Our Service Company name search & Documents preparation Preparing the Company Articles of Association ( A & A) Certificate of Incorporation Business Registration License Share certificate book ** Company chop, authorized signature stamp and common seal ** ** Include in Green Box with (with Statutory books inside) 1st year company secretarial services (Preparation of Annual Return NAR1 Only) 1st year register office services (Receive the Government Letters Only) 1 Set Certified true copy for Bank Account Opening Prepare a board minute for opening bank account (if required) Arrange and make appointment for bank account opening. Package Details (Setting up new company) HK$ US$ (6-8 working days Handover all documents) Company Registration (Incorporation charges) 1, Business Registration Certificate (from 1 April 2014) 2, Green Box (Company KIT) Company Secretary 1 st year 1, Registered Office Address 1, Incorporation Document preparation 1,000 - Corporate Bank account Minutes and Certified document (One set) Printing, Courier & Copying ,300 1,200 Please ADD if Shelf company or E-registration additional charges (2-3 working days Handover all documents) 1,000 The success of the account opening is never guaranteed and depends on the personal background and business profile of the client.

3 Company Annual Maintenance Services HK$ US$ From Second Year Annual Fee (Mandatory) Company Secretary 1, Registered Office Address 1, Business Registration Certificate (from 1 April 2014) 2, Annual Return (Companies registry)yearly payment Optional Business address, correspondence & document administration Annual responsibility fee. Disbursements and execution fees may apply. 2, Nominee shareholder (preparation of TRUST DEED stamp duty etc.,) 5, Salary & Profit TAX Return Preparation of Employers return 56A Preparation of Employers return 56B (each employee) Profit tax return (for inactive company) 1, Additional Company chop (Round and Authorized) Transfer of shares (preparing documents for 1 set document each) 1, Allotment of shares 1, Increase of Capital handling 1, Change of Director (each director) 1, Change of company name 2, Change of registered address (Directors ) Change of registered office Hong Kong company De-Registration 3,

4 CORPORATE BANK ACCOUNT IN HONG KONG Hong Kong banks are regulated by HKMA (Hong Kong Monitory Authority). To open your bank account the director(s) must come to Hong Kong and fulfill the KYC (Know Your Customer) obligation. Meet with a bank s account opening officer and explain your business type, products, submitting your business profile etc., We recommend: Hong Kong Shanghai Banking Corporation Limited (HSBC) Hang Seng Bank Limited (HSB) Standard Chartered Bank Limited. (SCB) HBZ Finance Limited (HBZ) Financial Institution. 1) Banks don t have the obligations to open bank account for all Hong Kong Registered companies. 2) Most local banks require the director(s) is/are Hong Kong Residence, have local address in Hong Kong and have business address in Hong Kong. 3) Director(s) must really prepare for your interview with above bank. - All director(s) and promoters should prepare their Business profile. - Residential address proof(s) of all director and shareholder - Previous business records with your existing business setup in Hong Kong or overseas. - Purchase or Sales orders issued to your existing company. - List of business partners. 4) Opening corporate account only depends on bank decision. No one can give 100% guaranty that you will succeed in opening bank account.

5 BUSINESS PLAN FOR BANK ACCOUNT OPENING Providing a Premium Rage of Corporate Service Since 2001 Company Name Business Nature Target Market Director(s) experience in Business Qualifications Why need bank account in Hong Kong Source of funds for the Business (eg. Parent company, Self, overseas business etc., ) Trade Terms (Letters of Credit / Tele. Transfers ) Number of Transactions per month/ year Business address and Contact numbers, address of director(s) or authorized persons.

6 Hong Kong Taxation Offshore Claim This section provides comprehensive information about Hong Kong s tax policies for individuals and firms. The information is presented in the form of short articles that are categorized below. Hong Kong is famous for its low tax rates and territorial taxation principles. Profits arising in or derived from Hong Kong are currently chargeable to Profits Tax at a rate of 16.5%. The first set of profits tax return will usually be issued to taxpayer s registered address about 18 months after the date of incorporation. Pre-conditions for liability to Profits Tax Under the Inland Revenue Ordinance, a person is chargeable to Profits Tax under the following conditions - he carries on a trade, profession or business in Hong Kong; the trade, profession or business derives profits; and the profits arise in or are derived from Hong Kong. The first two conditions are straightforward. Some elaboration is necessary for the third. Let us have a brief look at the basic principles for determining the source of profits. Basic principles for determining the source of profits The Courts have over the years considered the subject of the source of profits. The following principles have emerged from authoritative court decisions - Matter of fact The question of locality of profits is a hard, practical matter of fact. No universal rule can apply to every scenario. Whether profits arise in or are derived from Hong Kong depends on the nature of the profits and of the transactions which give rise to such profits. The operations test The broad guiding principle is that one looks to see what the taxpayer has done to earn the profits in question and where he has done it. In other words, the proper approach is to identify the operations which produced the relevant profits and ascertain where those operations took place. The source of profits must be attributed to the operations of the taxpayer which produce them and not to the operations of other members of the taxpayer's group. Antecedent or incidental activities The relevant operations do not comprise the whole of the taxpayer's activities. The focus is on establishing the geographical location of the taxpayer's profit-producing transactions as distinct from activities antecedent or incidental to those transactions. Place where decision is made The place where the day-to-day investment/business decisions take place is only one factor which has to be taken into account in determining the source of profits. It is not usually the deciding factor.

7 Gross profits from transactions The distinction between Hong Kong profits and offshore profits is made by reference to the gross profits arising from individual transactions. Business presence overseas A business may maintain a presence overseas which earns profits outside Hong Kong but the absence of a business presence overseas does not, of itself, mean that all the profits of a Hong Kong business invariably arise in or are derived from Hong Kong. However, in the vast majority of cases where the principal place of business is located in Hong Kong and there is no business presence overseas, profits earned by that business are likely to be chargeable to Profits Tax in Hong Kong. Hong Kong adopts a territorial source principle of taxation. Only profits which have a source in Hong Kong are taxable here. Profits sourced elsewhere are not subject to Hong Kong Profits Tax. The principle itself is very clear but its application in particular cases can be, at times, contentious. To clarify the operation of the principle, we have prepared this simple guide on the territorial source principle of taxation. It gives a brief explanation of how the principle operates and provides simple examples for illustrative purposes of the tests applied to different types of businesses. If you wish to explore the subject in greater depth, we recommend that you consult your professional advisers. Possibility of Tax Exemption Claim Under the territorial taxation principles, it is possible and legal for your company to have profits totally tax-free in Hong Kong. Profits of manufacturing businesses - The place of manufacture The source of profits for a manufacturing business is the place where the goods are manufactured. The profits arising from the sale of goods manufactured in Hong Kong are fully taxable here. Where goods are manufactured partly in Hong Kong and partly outside Hong Kong, that part of the profits which relates to the manufacture of goods outside Hong Kong will not be regarded as arising in Hong Kong. The place where the manufactured goods are sold is not relevant. Manufacturing under a processing or assembling arrangement with an entity in the Mainland of China In the Mainland, two types of processing trade normally involve Hong Kong companies: Contract processing and import processing. Contract processing In contract processing, the document that governs the contractual relationship among the parties is the processing agreement. It sets out the rights and responsibilities of the Hong Kong Company and the Mainland processing enterprise. The Hong Kong Company is responsible for the supply of raw materials and machinery without consideration and to provide technical know-how while the Mainland processing enterprise is responsible for the provision of factory premises, utilities and labour force. In return for the processing service, the Hong Kong Company pays subcontracting charges to the Mainland enterprise. The legal title to the raw materials and finished goods remains with the Hong Kong Company.

8 Strictly speaking, the Mainland processing enterprise is a separate sub-contractor distinct from the Hong Kong company and the question of apportionment in respect of the latter's profits should not arise. In the Department's view, the Hong Kong Company's operations in the Mainland complement its operations in Hong Kong. Recognising the operations of the Hong Kong Company in the Mainland, an apportionment of profits on a 50:50 basis is usually accepted. Import processing In import processing, the manufacturing operations are carried out by a foreign investment enterprise (FIE) incorporated in the Mainland and related to the Hong Kong Company. The Hong Kong company sells raw materials to the FIE and buys back the finished goods from the FIE. The Hong Kong company engages in the trading of raw materials and finished goods whilst the FIE manufactures the finished goods. The legal title to the raw materials and the finished goods passes to/from the FIE. The Departments holds the view that the profits which accrued to the Hong Kong company from "trading transactions" carried out in Hong Kong cannot be attributed to the manufacturing operations of the FIE carrying on business in the Mainland. The source of the trading profits must be attributed to the operations of the Hong Kong Company which produced them. Apportionment of profits is not appropriate. Manufacturing by an independent sub-contractor in the Mainland of China In cases where the assembly work is contracted to various contractors in the Mainland, the jobs are numerous, small in value and of short duration and the Hong Kong company has minimal involvement in the assembly work, then the manufacturing in the Mainland is not regarded as having been carried out by the Hong Kong company. Given that the Hong Kong Company does not carry out any manufacturing operations outside Hong Kong, its profits should be fully chargeable to profits tax without any apportionment. Trading Profits - The place where service is performed When a business earns commission by securing buyers for products or by securing suppliers of products required by customers, the activity which gives rise to the commission income is the arrangement of the business to be transacted between the principals. The source of the income is the place where the activities of the commission agent are performed. If such activities are performed in Hong Kong, the income has a source in Hong Kong. Factors such as the place where the principals are located, how they are identified by the commission agent and the place where incidental activities are performed prior or subsequent to the earning of the commission are not generally relevant in determining the source of the commission income. In the event that the commission income is earned by a person carrying on a business in Hong Kong but the activities which give rise to the commission are performed entirely outside Hong Kong, the commission is not taxable in Hong Kong. Service Income If the services in question are physically performed outside Hong Kong, it is possible for your company to apply for tax exemption claim on the service fee income. The residence of principals and location of incidental activities performed before or after the income is earned are generally considered as irrelevant.

9 Bookkeeping, Accounting and Taxation. Accountancy is crucial for business management and planning. No matter your business is in the start-up or developing stage or developed stage. Our Services Include: Setting Up of Appropriate Accounting Systems We can help your company establish an advanced and dedicated accounting system (TALLY ERP 9 / FOCUS RT), to manage the accounting and inventory operations. Maintenance of Accounting Books and Records Simply send all your invoices and vouchers to us by every month, and we will prepare the required accounting books and records for your company, with Invoice wise costing, recommendations on expenses, gross profit or gross loss margin on each invoices, department or branches. Monthly Accounting Periodic Accounting Annual Accounting Bulk Back Period account. Rectifying the messed up accounts. Preparation of Monthly, Periodic and Annual Financial Reports We will arrange for Annual Audits with your appointed Certified Public Accountants (CPA) or we can arrange one for your company to prepare accurate annual financial statements including balance sheet and income statement for Tax purpose.. Management Accounting We can help you develop an advanced managerial accounting system and internal controls in Accounting. We also conduct internal audits, Bank charges and interest verifications, rectify the messed up accounts.

10 Trade documents handling Letters of credit Export / Import Documentation 1. Receiving Letter of Credits (Irrevocable / Irrevocable Transferable / Back to back / Stand by LCs / Revolving LCs etc., 2. Transfer / Issue LCs to designated suppliers as per the customer s instructions 3. Received import documents under (DA, DP, Import LCs Transferable / Back to back etc.,) from customers bank or direct from customers. 4. Prepare or receive Export invoice (TRADE DOCUMENTS) as per the instructions from customer. 5. Submit to bank under Export LCs. 6. Prepare status report of documents submitted; Documents dispatch details by banks, Forward bank letters to customer. Inform payment status. Our charges: US$ for each Import (Supplier) LC (Transfer / Back to back LCs opened) US$ for each Export (Customer) documents submitted to ban under LC / DA / DP. Minimum charge of HK$ 4, per month Trade Documents Airway Bill / Bill of Lading Certificate of Origin / Certificate of Origin Re-Export Commercial / Customs Invoice Packing and/or Wait List Marine Insurance Policy ( Insurance Certificate) Inspection Certificate. Bill of Lading Issued in Hong Kong or issued else ware and arrange for switch Bill of Lading in Hong Kong.