Advantages of using a Hong Kong Company
Taxation
Hong Kong is a relatively low taxation city comparing with many other countries in the world. Its tax laws are straight forward and very simple. There is no sales tax. The profit is only charged on the profit derived in Hong Kong. The profit tax rate is currently subject to 16.5% on net profit only, which is very low as compared with the other countries.
Therefore, Hong Kong is considered as an international financial center and a cost effective tax-planning vehicle for business.
Stable Political Environment
Hong Kong has a very stable social and political environment. It is a Special Administrative Region of Mainland China. It enjoys the benefit brought by the economic growth of Mainland China on one hand and the relative independence and uniqueness of its legal system comparing to the other cities of Mainland on the other hand.
No Double Taxation
Hong Kong does not have any problems with double taxation of income as the tax is on a territorial basis. Hong Kong has a double taxation agreements (DTAs) signed with Belgium, Luxembourg, Mainland China, Thailand, and Vietnam as well which allows the enjoyment of tax benefits through proper structuring.
Nominee Shareholder and Director Structure
It allows Nominee shareholder and director structure for Hong Kong companies and oversea companies, which provides a convenience for asset management.
Cost Saving for Asset Transfer
Assets can be held by Hong Kong companies. The legal procedure is simpler and hence the respective legal and government fee is much lower for transfer of shares of a company then transfer of the title of the asset directly.
Legal System
For the legal system, with British legal system as background, which is well adopted, each company is a legal entity and is well protected by Laws and Regulations.
For the language, English and Chinese are adopted as bilingual legal language in Hong Kong.
Bank and Financial Facilities
The financial activities in Hong Kong are very active and free. There is no exchange control or any restriction in fund transfer. There are free markets in respective of gold, stocks, commodities and financial derivatives. It is easy to open bank account in Hong Kong in light of its simple procedures, The interest banking facilities implemented by the banks are efficient enough so that one can enjoy the convenience to operating his bank accounts at everywhere over the world.
International City
Hong Kong is a well-known international and financial center. It has the world’s largest container port, a well-established and efficient international airport and well-developed communication system which facilitate it a major gateway for investment and finance into China and rest of Asia.
The Closer Economic Partnership Agreement (CEPA)
CEPA was signed in 2003 by Central People’s Government and the Government of Hong Kong Special Administrative Region and came into effect on 1 January 2004. This agreement is exclusive to Hong Kong. Therefore, it further emphasis Hong Kong‘s position as the ideal location from which to business with China.
