What are the legal advantages of setting up a company in Hong Kong?

Setting up a company in Hong Kong offers significant legal advantages, including a simple and efficient incorporation process, low corporate tax rates with no tax on dividends or capital gains, and strong protection of shareholder rights under its common law system. Hong Kong’s independent judiciary, transparent regulations, and free capital movement also make it a trusted base for international business.

What is the corporate tax rate in Hong Kong?

Global Law Experts highlights that Hong Kong applies a two-tiered profits tax system for corporations: the first HKD 2 million of profits are taxed at 8.25%, while any additional profits are taxed at 16.5%. This structure offers significant tax efficiency, especially for smaller companies or early-stage businesses.

What are the legal requirements to get a work visa for Hong Kong?

Global Law Experts notes that to obtain a work visa in Hong Kong under the General Employment Policy (GEP), a foreign applicant must have a confirmed job offer, the role must not easily be filled by a local, and the employer must demonstrate genuine need. Applicants must show relevant skills or qualifications, while the employer should provide proper remuneration and benefits in line with market standards.

How long must you reside in Hong Kong to become a permanent resident?

Global Law Experts explains that to qualify for permanent residency in Hong Kong, also known as the Right of Abode, a foreigner must ordinarily reside in the city for at least seven continuous years. After this period, an application can be made to the Immigration Department, provided the individual has made Hong Kong their principal home during that time.

How are matrimonial assets divided in a Hong Kong divorce?

In Hong Kong, matrimonial assets are divided based on the principle of fairness, guided by the Matrimonial Proceedings and Property Ordinance (Cap. 192). Courts apply the “equal sharing” principle, considering financial and non-financial contributions, needs of children, earning capacity, and standard of living. While equal division is common, adjustments may be made to achieve fairness in each case.

Does Hong Kong have an inheritance tax?

Hong Kong does not impose inheritance tax or estate duty, as it was abolished in 2006. This means assets can be transferred to heirs without tax on the estate’s value. However, heirs may still be subject to stamp duty on property transfers and other legal requirements. Many investors see this as a significant advantage when holding or passing on wealth in Hong Kong.

Can foreigners buy property in Hong Kong?

Yes, foreigners can freely buy property in Hong Kong without restrictions on ownership. However, non-residents must pay higher transaction costs, including a Buyer’s Stamp Duty (BSD) of 15% in addition to standard stamp duties. Despite this, Hong Kong’s strong property rights and open market remain attractive to international investors.

How do you register a limited company in Hong Kong?

To register a limited company in Hong Kong, you must choose a unique company name, prepare incorporation documents (Articles of Association, incorporation form), and submit them to the Companies Registry. Once approved, you’ll receive a Certificate of Incorporation and Business Registration Certificate. Foreigners can own 100% of shares, and a local company secretary and registered office address are required.

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Hong Kong FAQ

Hong Kong has a common law legal system, inherited from British rule, which operates separately from mainland China under the “one country, two systems” principle. It emphasizes judicial independence, precedent, and the rule of law, with courts following English common law traditions while also incorporating local statutes and ordinances tailored to the region’s unique governance framework.

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