FAQ
The content of this page is general professional information and does not constitute tax, legal or investment advice. For specific cases, please consult a Hong Kong practising accountant or tax adviser, or refer to official publications of the IRD / SFC / HKMA / CR.
Yes, with preparation. The decision is the bank’s, on its own KYC/AML standards (AML Ordinance Cap 615 and HKMA guidance). Documents fall into four classes: corporate identity (CI, BR, articles, NAR1); financial (audited or management accounts, business plan); people (director and ≥10% shareholder ID, address proof, source-of-wealth); and business evidence (contracts, invoices, logistics records, ownership chart). Offshore structures, politically exposed controllers, higher-risk sectors and high-frequency cross-border flows trigger enhanced due diligence. No one can guarantee approval, and the account still requires periodic KYC refreshes after opening.
Simplified reporting does not waive the audit requirement. The statutory exception for dormant companies must be assessed separately. See the Companies Registry FAQ on accounts and audit.
Hong Kong profits tax is charged on assessable profits, not accounting profit: start from the audited accounts, add back non-deductible items (capital expenditure, fines, expenses unrelated to the business) and capital allowances, then apply the rate. Rates: 16.5% standard for corporations; under the two-tiered regime, 8.25% on the first HK$2 million of assessable profits and 16.5% on the balance, with only one entity in a connected group eligible to elect; unincorporated businesses are taxed at 15% (7.5% on the first HK$2 million). Scope: only Hong Kong-sourced profits are chargeable (territorial source principle, IRO s.14). Source is determined case by case under the operations test (DIPN 21) — what matters is where the substantive operations earning the profit are carried out, not where contracts are signed or payments received; offshore claims are available for foreign-sourced profits. Deductions and allowances: ordinary revenue expenses incurred in earning assessable profits are deductible; machinery and equipment enjoy a 60% initial allowance; qualifying R&D expenditure enjoys enhanced deduction (300% on the first HK$2 million, 200% thereafter); corporate losses may be carried forward indefinitely. Filing: the year of assessment runs from 1 April to 31 March, with tax assessed by reference to the accounting basis period; the BIR51 return, with audited accounts, is generally due within one month of issue, with provisional tax prepaid on current-year profits (deferral available on qualifying grounds). Hong Kong has no VAT or sales tax, no dividend withholding tax, and no general capital gains tax.
Profits sourced outside Hong Kong are generally not chargeable, and you may claim offshore treatment in your Profits Tax Return. However, IRD assesses each case on the actual operations generating the profit (DIPN 21) and may review after assessment, including field audits. Substance in Hong Kong (negotiation, decision-making, marketing) can defeat an offshore claim. No result can be guaranteed.
A private company needs at least one natural-person director and a company secretary. A sole director cannot also be the secretary. An individual secretary must ordinarily reside in Hong Kong; a corporate secretary needs a registered office or place of business there. Corporate-director restrictions depend on company type and group relationships.
Options include the General Employment Policy (GEP), the Admission of Talents / TTPS (Top Talent Pass Scheme — A: annual income ≥ HK$2.5M; B: degree from a top-100 university + 3 years' experience), and IANG for local graduates. Eligibility rules and quotas change; check ImmD (immd.gov.hk) before applying.
CRS is an automatic exchange of information (AEOI) between participating jurisdictions. Financial institutions report account data of tax residents of reportable jurisdictions — Hong Kong under IRO Schedule 17D, the Mainland under the six-ministry 2017 No. 14 Announcement. CRS exchanges information only; it does not itself create any tax liability. Liability is determined independently under each jurisdiction's tax law. Structure and classification (e.g. Active vs Passive NFE) matter — seek professional assessment rather than assuming privacy.