Set up a company in Hong Kong with Merritt
At a glance
Company structure
A Private Limited Company governed by Hong Kong company law.
Requirements
One director, at least one shareholder, a local Company Secretary, and a registered office in Hong Kong.
Share capital
No statutory minimum share capital is imposed.
Costs
Two levels, fees from the Authorities followed by Merritt's fees.
Taxation
Territorial tax system, two profits tax bands, and no local VAT.
Compliance obligations
Annual Return, Profits Tax Return, audit, Significant Controllers Register, Business Registration.
Banking
Bank KYC documentation is separate from incorporation and should be prepared in advance.
Why choose Merritt for your Hong Kong company?
Hong Kong occupies a pivotal position between mainland China and international markets. Four factors justify incorporating a company in Hong Kong rather than in another Asian business hub.
The relevant profile remains that of a French-speaking entrepreneur with an actual business in Asia, or a French company establishing itself in Hong Kong. The structure is only worthwhile if the business is genuinely connected to it. The urban and practical context is covered in why move to and live in Hong Kong and in the business district in Hong Kong.
Private Limited Company: the standard structure (and alternatives)
The Private Limited Company is the standard operating structure in Hong Kong. Other legal forms exist, but they serve specific purposes.
Private Limited Company
A limited liability company with separate legal personality. Shareholders' liability is limited to any unpaid amount on their subscribed shares. Share ownership is unrestricted, with no nationality or residency requirement. The company is managed by one or more directors, who may be individuals or legal entities. There is no statutory minimum or maximum share capital.
Hong Kong company → a company registered with the Companies Registry, identified by a company number and governed by the Companies Ordinance.
Company limited by guarantee
Form without share capital, used for associations, clubs, professional bodies, and certain nonprofit entities. Members guarantee a nominal amount in the event of dissolution. This Hong Kong legal entity is not suitable for commercial activity involving the distribution of profits.
Sole proprietorship and partnership
Sole proprietorship and partnership: no separate legal entity is created. Personal assets are liable for business debts without limitation. Formation is simpler, but personal exposure is higher. This structure suits a testing activity, not asset structuring.
Branch and representative office
A branch legally connects a foreign parent company to Hong Kong; it has no separate assets. A representative office is limited to promotional and monitoring activities, with no local billing. Both options require an existing parent company.
Offshore company in Hong Kong
Local usage of the term Hong Kong offshore company does not correspond to any local legal status. Any company incorporated there is a Hong Kong company and is subject to the same audit and reporting requirements. The term offshore describes a use, namely business conducted outside Hong Kong, rather than a type of entity. A structure without economic substance carries a risk of reclassification, particularly since the OECD’s work on CRS and BEPS. Details of uses and shareholding are available on the page dedicated to setting up a company in Hong Kong.
Hong Kong holding company → a locally incorporated holding company, useful for consolidating Asian subsidiaries; its suitability depends on the company’s actual substance and the tax residence of its shareholders.
Hong Kong LLC → a term used by entrepreneurs from the American market to refer to a Private Limited Company.
Requirements and documents
The incorporation documents must be checked before any application to incorporate. A project that is incorrectly classified at the outset will be rejected, followed by another filing cycle. The rules applicable to the company secretary and registered office are set out in the Companies Registry compliance FAQs.
Requirements
Director
At least one director, either a natural person or a legal entity, with no Hong Kong residency requirement.
Shareholder
At least one shareholder, whether an individual or a legal entity, with no residency requirement.
Company Secretary
A mandatory appointment. The Company Secretary must be an individual ordinarily resident in Hong Kong or a company with a registered office or place of business there. A sole director cannot also serve as Company Secretary.
Registered office
Physical address in Hong Kong for official mail.
Company name
Availability check, “Limited” suffix, exclusion of reserved or misleading names.
Documents
Identification documents for directors and shareholders, recent proof of address, description of the business activity, information on the source of funds, and identification of beneficial owners.
The KYC process is detailed on the page dedicated to the KYC policy.
Special cases
Corporate entity shareholder: trace the ownership chain up to the natural persons. Multi-tier structure: enhanced documentation and economic justification. Tax residence of directors: address separately from incorporation, with tax advice in the country of residence.
Steps to set up a company in Hong Kong
Name availability check and reservation
Availability check, review of restrictions, preparation of a substitute name in case of rejection.
Preparing the application
Identification of shareholders, directors, Company Secretary, and registered office; validation of KYC documents. This is when the quality of the Hong Kong company formation application is determined.
Filing the incorporation application
Submission of the incorporation form and articles of association to the Companies Registry. Open company Hong Kong → formal filing of the application, which triggers the registry's review.
Business registration
Apply for the Business Registration Certificate through the Inland Revenue Department as part of the incorporation process.
Issuance of incorporation documents
Certificate of Incorporation, Articles of Association, corporate registers, Business Registration Certificate. There is no such thing as the Hong Kong RCS: the equivalent is the Companies Registry, and the identifier assigned is the company number.
Opening a bank account
Separate file, processed in the next block, based on the incorporation documents.
Setting up ongoing compliance
Accounting, auditing, annual filings, recordkeeping.
Incorporation timelines
The timeline depends on three factors: name availability, the completeness of the application, and the registry’s processing pace. No fixed timeframe is given before the application has been reviewed.
Three factors commonly cause delays: an unavailable name, an incomplete application, and the bank’s KYC requirements. The sequencing details are provided on company formation and account opening timelines.
Name review
A rejected proposal requires a new submission and delays the entire sequence.
Application review
Incomplete documents generate a request for additional information, the most common bottleneck.
Business registration
Processed after incorporation, according to the administration's schedule.
Bank account opening
Timeline specific to the bank, unrelated to the incorporation date; it depends on the business profile and the quality of the KYC file.
Costs and packages
The pricing structure is based on two tiers, with no hidden professional fees.
Fee structure
Government fees: incorporation and business registration charges payable to the authorities.
Our professional fees: application preparation, company secretarial services and support.
What's included
Company incorporation, Company Secretary, registered office, statutory recordkeeping, banking assistance and after-sales support. Everything is covered by a single annual invoice.
Options and complimentary services
FREE assistance in opening a bank account : assistance with opening a business account, at no additional cost.
UNLIMITED after-sale support : unlimited after-sales support by email, phone, and WhatsApp.
Hong Kong company services : recurring secretarial, accounting, and compliance services, all handled by a single point of contact.
What's not included
Bank fees from the selected institution, annual audit fees, recurring tax filings, and annual administrative fees. These items are billed separately or covered by a dedicated service.
The nine services
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Hong Kong company taxation
The tax regime is based on territoriality, not on the company's place of residence. Four points structure the analysis.
The details are covered in taxation of a company in Hong Kong. The general framework for jurisdictions with preferential tax treatment is analyzed in tax havens.
Territorial basis of taxation
Only profits arising in Hong Kong are taxable. The concept of “offshore-sourced” profits requires a factual analysis: where contracts are negotiated, where services are performed, and where suppliers and customers are located. An offshore claim must be documented; it cannot be presumed.
Profits tax
Two tax rates apply: 8.25% on the first HKD 2 million of assessable profits, then 16.5% on the excess, for a company that meets the scheme's eligibility requirements. In principle, only one entity in a group of related companies can benefit from the reduced rates. Details are provided in the Inland Revenue Department FAQs.
France–Hong Kong tax treaty
The double taxation agreement between France and Hong Kong has been in force since December 1, 2011. It allocates taxing rights and provides mechanisms for eliminating double taxation, including tax credits. The consolidated text is published in BOFiP and on our tax treaties page.
VAT and invoicing
No local VAT is applied in Hong Kong. Commercial invoices can be in any format, as long as they include the usual details: identification of the parties, description of the services, amount, currency, and purchase order reference. Invoicing from Hong Kong to another country is then subject to the regulations of the destination country.
Business bank account
Opening a bank account is the main challenge after incorporation. Preparation should begin before the incorporation documents are submitted.
For the local banking context, see the banking benefits of Hong Kong, opening a bank account and the KYC policy.
Account opening
The account is opened in the company’s name, never in the director’s personal name. Some banks require a physical presence in Hong Kong, while others do not. The choice of institution comes before assembling the application: it determines which documents need to be gathered.
KYC documentation
Documents required: incorporation documents, articles of association, registers, identity documents and proof of address for beneficial owners, a detailed description of the business activity, key customers and suppliers, and the source of funds. Poorly documented business activity is the main reason for rejection.
Banks and alternatives
Traditional banks: international coverage, transfer processing, sometimes high balance requirements. Online banks and fintechs: faster account opening, lower fees, limits on certain transactions. Institutions outside Hong Kong: a fallback option for businesses with limited local ties.
Bank account opening service provider Hong Kong: a provider that prepares the banking application, recommends suitable institutions, and supports clients during interviews.
IBAN and bank details
Hong Kong does not use the IBAN format. Bank details consist of a bank code, a branch code, and an account number. International transfers require a SWIFT/BIC code. The expression “Hong Kong IBAN” is therefore a misnomer, sometimes used by neobank multi-currency accounts. L
Annual obligations and compliance
Annual compliance determines whether the company remains in good standing. Six obligations recur, each according to a schedule specific to the company.
Employment-related obligations are covered under obligations relating to an employee in Hong Kong. Common questions are covered in the Hong Kong company FAQ.
Annual audit
The accounts must be prepared and audited by a certified firm. Exemptions apply to dormant companies and in certain cases of reporting exemptions, without removing the obligation to prepare the accounts. The audit must be budgeted from financial year 2 onward. L
Annual Return filing
Filing Form NAR1 with the Companies Registry within 42 days after the anniversary of incorporation, except in the year of incorporation. Late filing incurs higher fees and may result in prosecution, as explained by the Companies Registry.
Profits Tax Return filing
Form issued by the Inland Revenue Department, to be completed with the audited financial statements. The first filing is due after the close of the first financial year; subsequent filings are due according to the chosen tax calendar.
Significant Controllers Register (SCR)
Register of significant controllers, required even when there is no significant controller. It is kept at the registered office or at a declared location, with notification to the register within 15 days. It is not filed with the Companies Registry but must be presented to the authorities upon request, in accordance with the Companies Registry rules.
Business Registration
Annual or triennial renewal with the Business Registration Office of the Inland Revenue Department. Payment of the renewal notice serves as the certificate. The procedure is described by the Inland Revenue Department.
Consequences of non-compliance
Increased fees, penalties, tax reassessments, bank account freezes if documentation is incomplete, and ultimately, company deregistration. Managing receivables and overdue payments may require a Hong Kong debt collection agency as a last resort; contractual reminders remain the first step.
Visas, residency and relocation to Hong Kong
Setting up a company does not grant a right of residence. Company incorporation and immigration are separate processes with different timelines.
The recommended order is to establish the company, demonstrate genuine business activity, and then prepare the visa application. Applications are reviewed by the Immigration Department's visa service. For insights into life in Hong Kong, see why move to and live in Hong Kong.
Employment visa
Assume a genuine position, market-rate compensation, and an application reviewed by the Immigration Department, with a sponsoring employer.
Investment
Program designed for entrepreneurs bringing substantial business activity to Hong Kong.
Residency
Income, housing, and renewal conditions, reviewed on a case-by-case basis.
Common mistakes to avoid
Seven mistakes recur in cases Merritt takes over after the fact.
Appointing a sole director without an eligible company secretary
The Company Secretary position becomes vacant, and compliance is breached from the moment of incorporation.
Choosing a bank before defining the business profile
Unsuitable KYC file, rejection followed by a new review.
Confusing territorial taxation with automatic exemption
An unsupported offshore tax claim can result in a tax reassessment.
Neglecting the SCR and company registers
No up-to-date register, leaving you exposed in the event of an inspection.
Leaving the audit out of the second-year budget
An unbudgeted expense can lead to late filing of financial statements.
Assuming incorporation alone entitles you to a visa
Relocation plans can be delayed or blocked without the required employment visa documentation.
Underestimating bank KYC requirements
Insufficient business activity documents; account not opened several months after incorporation.
Frequently asked questions
The timeline depends on three factors: name availability, completeness of the application, and processing by the Companies Registry. Once the documents have been gathered and the beneficial owners identified, the application is filed and tax registration is requested. Merritt does not provide a standard timeline: the schedule is confirmed after review and then tracked step by step.
No. Shareholders and directors may reside outside Hong Kong, with no nationality requirements. However, two roles must be locally based: the Company Secretary, who must be an individual ordinarily resident in Hong Kong or a company with a place of business there, and the registered office, which must be a physical address in Hong Kong.
No minimum share capital is required by the ordinance. The capital is freely determined upon incorporation, in shares, and may then be increased or transferred in accordance with the prescribed procedure. The amount is a matter of practical considerations: clarity for the bank, consistency with the business activity, and simplicity in managing the shareholding.
Not in the legal sense. Hong Kong law does not create a separate offshore status: every company registered is a Hong Kong company, subject to the same audit and filing requirements. The term offshore describes only an activity whose profits do not originate in Hong Kong, which falls under the territoriality principle of taxation.
A business account is required to receive and make payments and document business activity. It can be opened with a traditional bank, an online bank, or an institution outside Hong Kong, depending on expected transaction flows. The director’s personal account is not a substitute. The bank’s KYC file remains separate from the incorporation file.
Five obligations recur each year: the annual return to the Companies Registry, renewal of the Business Registration, maintenance of the Significant Controllers Register, bookkeeping and audit of the accounts, and then the Profits Tax Return issued by the Inland Revenue Department. Deadlines depend on the incorporation date and the tax calendar used.
The France–Hong Kong double taxation agreement has been in force since December 1, 2011. Its application depends on the company's tax residence and the nature of its income, not simply on where it was incorporated. A company managed from France may therefore be subject to different rules. This assessment should be carried out by a tax lawyer in the country of tax residence.
Setting up a company does not grant any right to stay. A work visa requires a genuine appointment, market-rate compensation, and an application processed by the Immigration Department, with an employer sponsor. An investment scheme is available for entrepreneurs bringing substantial business activity. L The recommended order remains: company, business activity, visa application.
Hong Kong government offices close on local public holidays, particularly Chinese New Year, which includes several consecutive days of closure. Filings made before a closure are processed when offices reopen. The timelines provided by registries and banks take these periods into account, and updates are shared as the matter progresses.
Hong Kong does not use the IBAN format. Bank details consist of a bank code, a branch code and an account number, along with the account holder’s name and address. For an international transfer, the bank’s SWIFT/BIC code is required. Some fintechs display IBAN-like references for their multi-currency accounts.
Yes. A Hong Kong mobile or landline number can be registered in the company’s name by presenting the incorporation documents and proof of address. Telephone answering and call forwarding services are common. This is important for local business credibility and certain banking requirements.
Traditional Hong Kong banks, online banks, and some regional institutions accept applications from newly incorporated companies. The decisive criterion is consistency between the declared business activity, expected cash flows, and documents provided. Merritt works with several institutions and provides guidance based on the company’s profile, without guaranteeing acceptance.
Merritt support for your Hong Kong company
Since 1998, Merritt has supported French-speaking entrepreneurs in three jurisdictions: the United States, Hong Kong and the United Arab Emirates. Our Hong Kong team includes legal and accounting professionals based in Kowloon, with a dedicated French-speaking contact throughout the engagement.
Registered Company Secretary
Service provided by Merritt Asia Limited, with no subcontracting.
One annual invoice
Government fees and professional service fees combined in one invoice, with no hidden professional charges.
French-speaking support
Email, phone, WhatsApp, and in-person appointments.
Response within four hours
Messages and calls handled Monday through Friday.
FREE banking assistance
File prepared and presented with the selected bank.
Ongoing support
Annual filings, SCR, Business Registration renewal, audit coordination.
The 9 services are detailed above and on the pricing page. To get in touch, use the Hong Kong form or the general form.
Our free services: assistance with opening a bank account, an initial consultation, a name availability check, unlimited after-sales support.
Banking questions: Hong Kong bank account FAQ.