How to Set Up a Company in Hong Kong as a Foreigner (2026)

The Hong Kong proposition

Hong Kong remains one of the world's premier business jurisdictions, despite the political changes of 2019–2020. It offers:

• Two-tier profits tax: 8.25% on the first HKD 2 million of assessable profits; 16.5% above
• No capital gains tax
• No VAT or GST
• No withholding tax on dividends paid to shareholders
• Territorial tax system: Profits from activities conducted outside Hong Kong (genuine offshore profits) are generally not subject to Hong Kong profits tax — the "offshore claim"
• Simple company structure: 1 director minimum, no local director requirement, 1 shareholder minimum, minimum HKD 1 share capital
• English common law: Courts and legal system operate in English; contracts governed by HK law are understood internationally

For trading businesses, e-commerce operations, and holding structures accessing China and Southeast Asian markets, Hong Kong's combination of tax efficiency, strong financial infrastructure, and commercial credibility remains compelling.

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Step 1: Choose a company name

• Your company name must:
• Be approved by the Companies Registry
• End in "Limited" (or "有限公司" for Chinese names)
• Not be identical or near-identical to an existing registered name
• Not require special approval (words like "Bank," "Trust," "Insurance," "Government")

Check availability at the Companies Registry e-Search service (eservices.cr.gov.hk).

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Step 2: Incorporate via the Companies Registry

• Requirements:
• Company name
• Registered office address in Hong Kong (physical address; not PO box)
• At least 1 director (individual or corporate; no nationality or residency restriction)
• At least 1 shareholder (individual or corporate; no restriction)
• Company secretary: must be ordinarily resident in Hong Kong (individual) or incorporated in Hong Kong (corporate)
• Share capital: minimum HKD 1

How to apply: The Companies Registry offers an e-Registry portal (eservices.cr.gov.hk) for online incorporation.

Alternatively, engage a Hong Kong company formation agent or law firm — numerous firms offer turnkey incorporation services for USD 200–500.

• Government fees:
• Incorporation fee: HKD 1,720 (for a company with standard articles)
• Business Registration Certificate: HKD 2,200 (first year, effective April 2024 — verify current rate)

Timeline: 1–3 business days for online applications via e-Registry.

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Step 3: Appoint a company secretary

Every HK private company must have a company secretary who is a Hong Kong resident (individual) or a corporate body incorporated in Hong Kong. This is a mandatory, ongoing appointment.

Cost: HKD 2,000–5,000/year for a registered company secretarial firm.

• The company secretary:
• Manages Companies Registry filings
• Maintains the company's statutory registers
• Prepares annual returns and files them

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Step 4: Open a bank account

This is the biggest challenge for non-resident owners of Hong Kong companies post-2020.

• Traditional banks (HSBC HK, Hang Seng, Bank of China HK, Standard Chartered HK):
• All require in-person meeting at a Hong Kong branch
• Enhanced KYC since 2020: expect extensive documentation requirements
• Typical approval timeline (when accepted): 2–4 months
• Rejection rates for companies with no local directors or local business activity: high

• What helps with traditional banks:
• At least one locally-resident director or authorised signatory
• Evidence of actual Hong Kong business activity (local suppliers, clients, partnerships)
• Clear, simple business model with a documented paper trail
• Strong personal banking history in your home country

Digital alternatives:

Recommended approach: Open ZA Bank or Airwallex (HK) online immediately for operational banking. Apply to HSBC or Standard Chartered once you have trading history and a local business connection.

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Step 5: Register for tax

Hong Kong profits tax is administered by the Inland Revenue Department (IRD).

Business registration: Already covered by the Business Registration Certificate obtained at incorporation.

Profits Tax Return: First return issued approximately 18 months after incorporation. The IRD sends a return; you file it with supporting financial statements. Returns are filed in April–November depending on your financial year end.

Annual filing of profits tax return: HK companies must appoint a Hong Kong-based accountant (CPA) to prepare audited financial statements and the profits tax return.

Important — Audit requirement: Unlike the UK, Ireland, or Singapore (which have small company audit exemptions), virtually all Hong Kong private limited companies are required to have their accounts audited annually. The audit must be conducted by a Hong Kong-registered CPA. There is a limited exemption for dormant companies.

• This makes HK annual compliance more expensive than comparable jurisdictions:
• Accountant + audit: HKD 8,000–25,000/year (USD 1,000–3,200) depending on complexity

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The offshore claim — how it works

If your HK company earns profits from activities conducted entirely outside Hong Kong, you may apply for offshore status for those profits, meaning they are not subject to Hong Kong profits tax.

• Conditions for an offshore claim:
• The profit-generating activities (contracts negotiated, services performed, goods sold) occur entirely outside Hong Kong
• The company does not have employees in Hong Kong working on those activities
• Management decisions relating to those profits are not made in Hong Kong

In practice: An offshore claim requires an application to the IRD with supporting evidence (contracts, correspondence, bank records, management records). The IRD reviews and may grant partial or full offshore status.

The offshore claim has become more scrutinised: Since Hong Kong implemented the FSIE (Foreign-Sourced Income Exemption) rules from January 2023, foreign-source passive income (dividends, interest, royalties, gains from disposal of equity interests) received in Hong Kong is taxable unless certain requirements are met (adequate economic substance in HK, participation exemption, etc.). This affects passive income specifically; the traditional offshore claim for active trading income continues to apply.

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Real cost (Year 1)

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Who should set up in Hong Kong

✅ Businesses trading with mainland China (HK remains a key gateway) ✅ E-commerce and trading companies with Asian supply chains ✅ Companies seeking a Southeast Asian hub with English law ✅ Holding structures above mainland Chinese operating entities ✅ Companies wanting the two-tier 8.25%/16.5% rate on genuine HK-sourced profits

❌ Those who cannot deal with the banking friction ❌ Solo digital founders with no Asia operations (Singapore or Estonia serve this better) ❌ Anyone primarily serving Western clients who prefer UK/US entities ❌ Post-2023, anyone relying purely on the offshore claim for passive income without substance

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