Hong Kong, a special administrative region of China, has kept moving forward with prosperity and dynamism. With its high standards of living and the benefits of doing business, entrepreneurs are attracted to getting more opportunities here. So, what exactly are the opportunities available for business in Hong Kong? This article lays down the top benefits of doing business, or business takeover in Hong Kong.
One of the reasons why Hong Kong is superior to do work in is that it permits foreign entrepreneurs to completely own their enterprise. There is no holding percentage limit that controls the overseas business owner’s rights to the entire corporation. Moreover, business incorporation is much easier and faster in Hong Kong. These policies make Hong Kong very attractive to foreign investments.
Further, the incorporation requirements are very similar to that of other highly-developed countries. If the investors want to form a private limited company, the state allows up to 50 persons to incorporate the said company. Additionally, they only require the forming company to have at least one person, who can be both a shareholder and a director. The company directors are not required to be locals or residents to hold their position. Also, Hong Kong only requires a minimum of HK$ 1 share capital.
Advantageous Tax System
Hong Kong is a superior place to do business in for its low-tax regime. It adopts a two-tiered tax rate. The initial HK$ 2 million are taxed at 8.25%, and the excess at 16.5%. This tax policy is appraised work-friendly as it is one of the most competitive tax rates in Asia.
Moreover, companies in Hong Kong can avail of the Offshore claim. This provides a non-taxation of qualified companies’ gains from outside the territory. The process to get the approval of the Inland Revenue Department (IRD) can be quite tedious, but getting such approval will prove to be beneficial. The validation of the offshore claim runs up to 5 years, which could translate into 5 years of tax savings on your offshore activities.
Free Economy and Trade
In 2019, the Heritage Foundation has recognized Hong Kong as the freest economy in the world. Hong Kong has retained this status for the past two decades as a result of providing trade and monetary freedom with transparency and integrity. With this free economy and trade environment, all types of businesses can be set up in Hong Kong.
Furthermore, Hong Kong-based companies can open bank accounts anywhere without government restrictions. Additionally, there are no tax charges for imports to Hong Kong, with exclusions to industries like motor vehicles, liquors, tobacco, hydrocarbon oil, and methyl alcohol. Lastly, Hong Kong also exempts tax and excise duty on total exports.
Hong Kong is home to huge, highly-trained, and flexible manpower. The residents of Hong Kong have adapted to international business and way of life. Here, English is the second official language, next to Cantonese. The environment in Hong Kong is also diverse, with immigrants from the West and other Asian countries. An ecosystem with a strong and diverse workforce like Hong Kong is beneficial to running a successful business.
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