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Three Mistakes to Avoid When Incorporating a Business in Hong Kong


For years, Hong Kong has been rightly named as the business paradise. It is the ultimate place that every investor who wants rapid growth and success rushes to. Whether you are in information technology niche, import/export business, or want to offer financial services among others, Hong Kong is a great option.

Even though the market is ready for you, it is surprising to realize that many enterprises experience a lot of challenges setting up their operations. This is caused by the high competition. To be sure of easy setup a company and enjoying faster growth, here are some mistakes to avoid.

Buying a shelf company

The idea of hastening the process of having a functional company often lands people to thoughts of buying a shelf company. Shelf companies are businesses registered in Hong Kong but are no longer in use.

Though the process might look easier and direct, it becomes very difficult when you need to change the bank account details. Many banks will rarely agree to change the bank account from the original holders to new persons. Therefore, do not make this mistake because it will lead to huge losses and even spiral into court battles.

Entering the Hong Kong environment without comprehensive market analysis

Just like you have found the Hong Kong business environment attractive, even other investors are also headed there. To succeed, you need to appreciate this fact and carry comprehensive market assessment.

While you can do it on your own, a simpler and more effective method is seeking the help of corporate services agencies. Because they carry progressive studies in Hong Kong and neighboring markets, it means that you do not have to hit the road again. Everything has been done professionally, and you only need to interpret and actualize the data.

Failing to review the business tax obligations when starting the operations

Hong Kong, like other countries targets attracting more businesses to grow its tax portfolio. This is the reason they go to great lengths in helping businesses launch and even nurture them. To be on the right side of the Hong Kong administration, you need to understand the Companies Ordinance and carefully meet all the tax obligations. Remember that being tax compliant also comes with the benefit of enjoying special treatment under the Double Tax Agreements between Hong Kong and its neighbors.

The Hong Kong administration has created a perfect place for investors to nurture their enterprises and take off. Whether you are at startup or want to expand to this promising market, make sure to avoid the outlined three mistakes.