Set up a company in Hong Kong.
Asia-Pacific's premier financial centre. Two-tier profits tax (8.25% on first HKD 2M, 16.5% above). Territorial system — offshore profits exempt with valid IRD claim. Common-law jurisdiction with the Court of Final Appeal at the apex. Gateway to Mainland China and the Greater Bay Area. 50+ Comprehensive Double Tax Agreements. HKD pegged to USD since 1983.
Hong Kong — the essentials.
Six reasons clients choose Hong Kong.
Hong Kong is not an offshore jurisdiction in the Caribbean sense. It is Asia-Pacific's premier financial centre — an onshore, deeply-respected, common-law jurisdiction with a territorial tax system that treats foreign-source profits favourably and Hong Kong-source profits at globally-competitive rates. The "offshore claim" mechanism is unique: a properly structured Hong Kong company with all profit-generating activity outside Hong Kong can secure full tax exemption on those profits via a formal IRD ruling.
Two-tier profits tax: 8.25% / 16.5%
The two-tier regime introduced in 2018 taxes the first HKD 2 million (~USD 256k) of corporation profits at 8.25%, with profits above that threshold at 16.5%. SMEs and growth-stage businesses benefit materially. Anti-avoidance: only one entity per connected group can elect the two-tier rates. Globally competitive even at the standard rate — among the lowest of any major financial centre.
Territorial tax — offshore profits exempt
Only profits arising in or derived from Hong Kong are taxable. Profits from activities carried on entirely outside Hong Kong can qualify for full tax exemption via an offshore claim to the IRD. The source of profits is determined by where profit-generating activities physically occur — not where the company is registered or where payment is received. The mechanism through which "Hong Kong offshore" structuring works.
Common-law & Court of Final Appeal
Common-law jurisdiction rooted in English legal tradition. The Court of Final Appeal (CFA) is the apex court — sophisticated commercial dispute resolution with overseas non-permanent judges including former UK Supreme Court justices. World-class legal infrastructure: international arbitration via HKIAC, specialist commercial bench, and one of Asia's most experienced offshore-onshore advisory communities.
Gateway to Mainland China & the GBA
CEPA (Mainland and Hong Kong Closer Economic Partnership Arrangement) provides preferential trade and services access into Mainland China. Greater Bay Area integration links Hong Kong with 10 Mainland cities — an 86M+ person megaregion. For groups doing business in or with China, Hong Kong remains the natural structuring base: familiar legal framework, free FX, no capital controls.
HKD pegged to USD since 1983
The Linked Exchange Rate System (LERS) has held the Hong Kong Dollar at HKD 7.75–7.85 per USD since 17 October 1983 — over 40 years of monetary stability. Defended by the HKMA via convertibility undertakings. No FX controls of any kind. International transactions settle freely in HKD or USD. Material structural advantage over emerging-market or non-pegged jurisdictions.
Same-day e-incorporation, deep ecosystem
The Companies Registry e-Services platform supports same-day electronic incorporation. Hong Kong has Asia's most experienced offshore-onshore advisory ecosystem — professional services firms, banks, accounting practices, registered offices, and company secretaries are all readily available and competitively priced. From discovery to operational entity: realistic 2–4 weeks including bank account.
Choose the right vehicle — six options.
The vast majority of international clients use the Hong Kong Private Limited Company (Ltd) under the Companies Ordinance Cap. 622. Specialised vehicles — Limited Partnership Funds, CLGs, Branches — address specific structural needs. All Hong Kong companies must have a registered office and a HK-resident company secretary.
| Structure | Min. Capital | Liability | Best for | Formation |
|---|---|---|---|---|
Private Limited (Ltd)Companies Ordinance Cap. 622 Most Used |
HKD 1 nominal No statutory minimum typically HKD 10,000 issued |
Limited to share capital | The default for international clients. International trading, holding companies, regional HQ, services businesses, joint ventures. Eligible for offshore claim where profit-generating activities are entirely outside HK. 50+ DTA network access. | 1 day – 1 week (e-Services: same-day) |
Limited Partnership Fund (LPF)Limited Partnership Fund Ordinance 2020 |
None statutory Partner contributions only |
LP: limited partners protected GP: joint & several |
Private equity, venture capital, hedge fund vehicles, real estate funds. Tax-neutral pass-through. Carried interest can qualify for 0% concessionary rate. Modern legislation specifically designed to compete with Cayman/Singapore for fund domicile. | 2–4 weeks |
Public Limited (PLC)Companies Ordinance Cap. 622 |
None statutory HKEX listing minima apply |
Limited to share capital | Larger businesses, HKEX listing track. The Stock Exchange of Hong Kong is one of the world's top equity exchanges by capitalisation. Strong dual-listing track record with Mainland Chinese issuers via Stock Connect. | 3–6 weeks |
Company Limited by Guarantee (CLG)Companies Ordinance Cap. 622 |
None · guarantee-based Members guarantee on dissolution |
Limited by guarantee | Non-profit organisations, professional bodies, industry associations, charitable foundations. Section 88 IRO charity status available subject to IRD recognition. Non-profit structuring under Hong Kong common law. | 3–6 weeks |
Branch (Non-HK Co.)Companies Ordinance Part 16 |
None Parent provides capital |
Parent company liable | Foreign-incorporated groups establishing local presence. Registered as Non-Hong Kong Company at the Companies Registry. Subject to profits tax on HK-source profits only. Useful where the group prefers branch-form to subsidiary-form. | 2–4 weeks |
Representative OfficeLiaison · no commercial activity |
None Cannot trade or invoice |
Parent company | Marketing, market research, sourcing, and liaison activity only. Cannot conduct revenue-generating commercial transactions. Useful for early-stage market exploration in HK or as a CEPA-China gateway scoping exercise. | 1–2 weeks |
The numbers that matter.
Hong Kong's tax framework is sophisticated but transparent. Two-tier profits tax. Territorial system with offshore-claim mechanism. FSIE regime for MNE-group passive income. Special concessionary rates for IP, family offices, funds, shipping, and reinsurance. The numbers below reflect the 2026 position post-FSIE-expansion (1 January 2024). Mandatory annual audit applies to all Hong Kong companies.
From decision to trading entity.
Hong Kong is among the fastest mature jurisdictions to incorporate in. Standard Ltd incorporation through Companies Registry e-Services completes same-day. Realistic end-to-end timeline including KYC, company secretary appointment, Business Registration Certificate, and bank account opening: 2–4 weeks. Where an offshore claim will be pursued, the documentation work begins at structuring stage, well before the first profits tax return.
Discovery & structure design
Confirm the right vehicle (Ltd, LPF, PLC, CLG, Branch, Rep Office), assess offshore-claim viability, FSIE applicability for MNE-group structures, evaluate two-tier rate election strategy across connected entities, and consider concessionary regimes (Patent Box, FIHV/SFO, carried interest, shipping).
Name reservation & constitution
Company name reservation via Companies Registry — checked against existing HK companies. Articles of Association drafted under the Companies Ordinance Cap. 622. Form NNC1 (private) or NNC1G (public) prepared. Director and shareholder identification documents collected. Significant Controllers Register prepared.
Companies Registry e-Services
Filing through Companies Registry e-Services platform. Standard Private Limited (Ltd) incorporation completes same-day for electronic submissions. Certificate of Incorporation issued. Business Registration Certificate from the Inland Revenue Department issued simultaneously under the One-Stop Company & Business Registration Service.
Statutory officers & registered office
Hong Kong-resident company secretary appointed (mandatory — HK-resident individual or HK-incorporated company secretary firm). Registered office in Hong Kong established. Statutory registers (members, directors, charges, Significant Controllers) maintained at the registered office. First directors and first shareholders formally appointed.
Bank account opening
Hong Kong commercial bank account opened. Major banks: HSBC, Hang Seng, Standard Chartered, Bank of China (Hong Kong), DBS Hong Kong. Multi-currency accounts (HKD/USD/RMB) standard. Enhanced KYC for international shareholders — documentation pack prepared. Virtual banks (Mox, ZA, WeLab) increasingly viable for SME use cases. Banking is the longest gate.
MPF & employer registration
Where the company employs Hong Kong-resident staff: Mandatory Provident Fund (MPF) employer registration with the MPFA. Employer's Return registration with the IRD. Employees' Compensation Insurance arranged (mandatory). Where international staff are relocated: work visa applications via the Hong Kong Immigration Department.
Offshore claim documentation & sectoral licences
Where the company will pursue an offshore claim: substantive operational documentation prepared from day one (contract trail, decision-making location evidence, service-delivery location records). For regulated activities, sector-specific licensing via the SFC (securities, fund management) or HKMA (banking, money services, payment systems) — 3–9 months depending on category.
A single partner. End to end.
You get one senior point of contact at Grant & Graham. Behind that, a vetted local network of HK-licensed company secretaries, HKICPA accounting practices, solicitors, and banking introducers we have worked with for years on the ground in Central, Admiralty, and Causeway Bay.
Structure & offshore-claim strategy
Choosing the right vehicle (Ltd, LPF, PLC, Branch, Rep Office), assessing offshore-claim viability, FSIE applicability for MNE-group structures, two-tier rate election strategy across connected entities, and structuring for concessionary regimes (Patent Box, FIHV/SFO, carried interest, shipping). Direct, evidence-based recommendation.
Constitution & secretary appointment
Articles of Association under Companies Ordinance Cap. 622, NNC1/NNC1G drafting, Significant Controllers Register, HK-resident company secretary appointment with vetted licensed providers, BCA-compliant resolutions, and Court-of-Final-Appeal-aligned contract review where dispute exposure matters.
CR, IRD & e-Services
Companies Registry e-Services electronic incorporation (typically same-day), simultaneous Business Registration Certificate from IRD, NAR1 annual return filing (within 42 days of incorporation anniversary), Business Registration Certificate annual renewal, and ongoing statutory register updates.
HK & international banking
Direct introductions to Hong Kong banks (HSBC, Hang Seng, Standard Chartered, Bank of China HK, DBS HK) and virtual banks (Mox, ZA Bank, WeLab Bank) where SME-appropriate. Multi-currency HKD/USD/RMB accounts. Enhanced-KYC documentation pack prepared end-to-end. Coordination with international correspondents in Singapore, London, New York.
HKICPA audit & IRD filings
Bookkeeping under HKFRS or IFRS, mandatory annual audit by HKICPA-certified CPA (statutory requirement for all HK companies), Profits Tax Return preparation and filing, offshore-claim documentation where applicable, FSIE compliance for MNE-group structures, and Employer's Return filings.
HR, MPF & immigration
Employment contracts under the Employment Ordinance, MPF employer registration, Employees' Compensation Insurance, salaries-tax processing, work visa applications via Hong Kong Immigration Department for international team members, and relocation logistics for senior staff moving to Hong Kong.
Hong Kong is the right answer for specific situations.
Hong Kong is a credible onshore-with-offshore-features jurisdiction. It is the right answer where institutional credibility, banking depth, and Asia-Pacific presence outweigh the audit and compliance overhead. It is the wrong answer where the goal is unregulated offshore simplicity — for that, BVI or Belize fit better.
You are doing business in or with Mainland China
CEPA preferential market access. Greater Bay Area integration. Familiar legal framework on the HK side. Common cultural and language understanding of Mainland counterparties. Free FX (no capital controls) versus the RMB framework. Hong Kong remains the natural structuring base for any group with material China exposure — whether trading, investing, or operating onshore.
You operate across Asia-Pacific
Asia-Pacific's most experienced offshore-onshore advisory ecosystem. HKD pegged to USD removes Asian-currency volatility risk for international transactions. 50+ DTAs. Same time zone as China, Singapore, Japan, Korea (give or take). Court of Final Appeal as a sophisticated commercial dispute-resolution forum. The natural regional HQ jurisdiction for groups with multi-country APAC operations.
You qualify for an offshore claim
Where all profit-generating activities (contract negotiation, service delivery, decision-making) occur entirely outside Hong Kong, the company can claim full tax exemption on those profits via a formal IRD ruling. Properly structured, this is the closest thing to a credible "Hong Kong offshore" outcome — combining the regulatory legitimacy of an onshore HK company with full tax exemption on foreign-source profits.
You are running a family office or PE/VC fund
Single Family Office regime (FIHV) delivers 0% concessionary rate on qualifying transactions for eligible Family-Owned Investment Holding Vehicles. Carried Interest regime delivers 0% on qualifying carried interest. Limited Partnership Fund Ordinance 2020 specifically designed to compete with Cayman/Singapore for fund domicile. Material structural advantages for high-net-worth and institutional asset-management structures.
You need institutional banking depth
HSBC, Standard Chartered, Bank of China, DBS, BNP Paribas, Citi, JPMorgan all have material HK operations — one of the deepest international banking centres in Asia. Bank account opening for credible HK companies is materially more straightforward than for Caribbean offshore vehicles, and banking willingness toward HK structures is unmatched for international groups operating across APAC.
You can absorb the audit and compliance overhead
Hong Kong is unusual among low-tax jurisdictions in requiring a full annual audit by a HKICPA-certified CPA. Mandatory HK-resident company secretary. Annual Return (NAR1). Business Registration Certificate annual renewal. SCR maintenance. None of it is excessive, but if the goal is unregulated offshore simplicity (no audit, no annual filings beyond renewal), Hong Kong is the wrong answer — consider BVI or Belize. Hong Kong is for groups that want institutional credibility AND tax efficiency.
Get an estimate in 30 seconds.
Three quick questions. We will give you a realistic cost range and timeline for your situation, and route the answers straight into a fixed-price quote request.
The questions we get asked most.
Is Hong Kong an offshore jurisdiction?
How does the two-tier profits tax actually work?
What is required to get an offshore-profits claim approved?
What is the FSIE regime and does it apply to my company?
Is annual audit really mandatory for all Hong Kong companies?
What are the ongoing compliance obligations for a HK company?
Hong Kong vs Singapore vs BVI.
The three jurisdictions investors most often weigh against each other when structuring an Asia-Pacific entity. Hong Kong as the China-gateway onshore financial centre; Singapore as the Asean-gateway alternative; BVI as the unregulated offshore comparison point. A side-by-side on what actually matters at the structuring stage.
| Hong Kong | Singapore | BVI | |
|---|---|---|---|
| Standard CIT | 16.5% (8.25% on first HKD 2M)Two-tier corporate regime | 17%Partial exemptions for SMEs | 0%Genuine zero-tax regime |
| Tax System | TerritorialOffshore-claim mechanism available | Modified territorialForeign-source remittance taxable | None (no domestic tax)No territorial concept needed |
| CGT · VAT | 0% / 0%No CGT, no VAT/GST | 0% / 9% GSTNo CGT; GST applies | 0% / 0%No CGT, no sales tax |
| Annual Audit | Mandatory (all companies)HKICPA-certified CPA | Mandatory above thresholdsSmall-company exemption applies | AFR only (no audit)Simple balance sheet + P&L |
| DTA Network | 50+ DTAsIncluding Mainland China CDTA | 90+ DTAsMost extensive Asian network | NoneNo need: zero domestic tax |
| Currency | HKD pegged to USD7.80 ± 0.05 since 1983 | SGD managed floatMAS basket-based regime | USD (native)Actual USD, not pegged |
| Best Fit | China-gateway, GBA-integrated structures, Asia-Pacific HQs, family offices, PE/VC funds, IP-driven (Patent Box) | ASEAN-gateway, IP holding (no FSIE limits), tech HQs, fund domicile | Universal-recognition offshore for international holding/trading where audit overhead is unwanted |
Hong Kong is one of 100+ markets we cover.
If Hong Kong is not the right answer for your situation, here are the markets clients most often consider alongside it — particularly across Asia-Pacific, the offshore-Caribbean comparators, and Europe-side alternatives for groups choosing between Asian and European structuring bases.
Singapore
Asia-Pacific's other major financial centre. 17% CIT with partial exemptions, modified territorial system, 90+ DTA network, ASEAN-gateway positioning. The natural alternative when Mainland China exposure is less central or ASEAN-focus dominant.
Set up in SG →British Virgin Islands
The industry-standard offshore vehicle. 0% corporate tax, common-law, USD-native, ~40% global offshore market share. The unregulated-simplicity alternative when audit and substance are not required.
Set up in BVI →Cayman Islands
The premier fund-domicile jurisdiction. 0% corporate tax, deepest fund-administration ecosystem globally. Often paired with HK companies for institutional fund structures domiciled in Cayman with HK operating presence.
Set up in KY →United Arab Emirates
Free zone (DIFC, ADGM) or mainland options. 9% corporate tax, 140+ DTA network, gateway to MEA region. For groups looking at Asia-MEA bridge structures, frequently paired with HK or Singapore parent.
Set up in UAE →Jersey
European offshore alternative. 0% standard CIT, common-law jurisdiction, robust regulatory infrastructure. The traditional choice for European-investor-led structures and family offices — an Atlantic-side complement to HK's Pacific-side role.
Set up in JE →Belize
The reformed Caribbean offshore. Common-law, English-speaking, FATF "Compliant" rated. Foreign-source income exempt under the territorial system. Lower setup cost than HK; comparable common-law framework with no audit requirement.
Set up in BZ →Ready to set up in Hong Kong?
Tell us what you are trying to do and we will come back inside 48 hours with a fixed-price quote, realistic timeline, and an honest read on the right vehicle (Ltd vs LPF vs Branch), offshore-claim viability, FSIE applicability, two-tier rate election strategy across connected entities, and whether Hong Kong is genuinely the right answer for your structure. No pressure to commit — just a clear answer from a senior adviser.