Hong Kong: company formation and banking
Hong KongAsia- Profits tax, corporations (two-tier)
- 8.25% on the first HK$2,000,000; 16.5% above
- As of 2026-10-25 · [1]
Overview
Hong Kong taxes profits that arise in or derive from Hong Kong and draws no distinction between residents and non-residents. A company run from Hong Kong pays tax on its Hong Kong profits; profits genuinely earned elsewhere can be claimed as offshore, which takes evidence and is reviewed by the Inland Revenue Department.
Capital gains are outside profits tax, and dividends paid by a Hong Kong company are not taxed in Hong Kong. Many owners simply pay the two-tier profits tax instead of pursuing an offshore claim, because the rate is moderate and the position is easier to explain to banks.
A Hong Kong company often sits inside a wider structure, for example below a holding company in another jurisdiction. Ownership is never anonymous: every company keeps a register of significant controllers, and banks verify beneficial owners in all cases.
Redomiciled coordinates setup and bank introductions; Hong Kong accountants and lawyers advise on tax and law.
Hong Kong company formation for international founders
A Hong Kong private company limited by shares is a separate legal entity that non-residents can own entirely, used for trading, services and holding Asian revenue. Electronic applications normally receive their certificates within an hour, and since 23 May 2025 existing foreign companies can also re-domicile into Hong Kong.
Incorporation runs through the Companies Registry's e-Services Portal. You file the incorporation form, the articles of association and the business registration notice together, and electronic certificates for a private company limited by shares are normally issued within one hour. In our experience the whole formation takes about a week once documents are complete.
A private company needs at least one director who is an individual and a company secretary; an individual secretary must ordinarily live in Hong Kong, and a corporate secretary must have an office there. Annual accounts are audited by a Hong Kong practising accountant and support the profits tax return.
The re-domiciliation regime, in force since 23 May 2025, lets a company incorporated elsewhere transfer its domicile to Hong Kong without creating a new entity. It covers companies comparable to Hong Kong companies with a share capital, imposes no economic substance test and only works inward.
Tax and legal advice comes from licensed Hong Kong professionals; Redomiciled coordinates the work.
Who it suits
Trading and sourcing businesses
You buy from Asian suppliers and sell internationally, and need a credible counterparty with multi-currency banking.
Service and online businesses
You invoice international clients and want a well-known jurisdiction with a moderate tax rate.
Groups expanding into Asia
You want a regional company close to Asian customers, suppliers and banks.
Companies relocating their domicile
Your existing company wants to move to Hong Kong under the re-domiciliation regime without winding up.
Requirements
- Required
At least one individual director
Any nationality and place of residence; a sole director cannot also act as company secretary.
- Required
Company secretary in Hong Kong
An individual ordinarily resident in Hong Kong or a company with an office there.
- Required
Registered office in Hong Kong
The address for statutory correspondence and notices.
- Required
Shareholder and significant controller details
Owners and controllers are recorded; anonymous ownership is not available.
- Required
Annual audit and profits tax return
Accounts are audited every year and support the tax return.
- Depends on your case
Holding company above the Hong Kong entity
Useful for some groups; a holding company that receives income can face extra substance and reporting rules where it is incorporated.
Documents
- Incorporation form (NNC1)Company name, share capital, initial shareholdings, directors and secretary.
- Articles of associationThe Registry's model articles can be used as they are or customised.
- Notice to Business Registration Office (IRBR1)Filed with the incorporation so the business registration certificate issues at the same time.
- Identity and address proofsPassports and recent address evidence for directors, shareholders and significant controllers.
- Business descriptionActivities, customers and expected flows; banks will ask for it in more detail.
- Lower tier within a group of connected entities
- 1 nominated entity onlyAs of 2026-10-25 · [2]
- Profits tax waiver, year of assessment 2025/26
- 100% up to HK$3,000 per caseAs of 2026-10-25 · [8]
- Re-domiciliation approval, normal case
- Within 2 weeks of a complete applicationAs of 2026-10-25 · [7]
- Deregistration abroad after re-domiciling
- Within 120 daysAs of 2026-10-25 · [7]
- Formation with documents ready (our experience)
- About 1 weekAs of 2026-03-04 · [9]
Timeline
- 1Structure and name checkAgree who holds the shares, whether a holding company sits above, and check the name against the Registry's guidelines.
- 2Electronic incorporationFile through the e-Services Portal; certificates are normally issued within one hour of a complete submission.
- 3Post-incorporation setupSignificant controllers register, registered office, secretary appointment and company records.
- 4Bank applicationApplications to institutions matched to the activity, followed by due diligence and interviews.
- 5Accounting and annual complianceBookkeeping, annual return, audit and the profits tax return.
Tax notes
- Corporations pay profits tax at 8.25% on the first HK$2,000,000 of assessable profits and 16.5% on the rest. Where connected entities exist, only the one nominated entity uses the lower tier.
- Profits arising outside Hong Kong are not taxed there. An offshore claim needs evidence of where the profit-producing activities took place and is reviewed by the IRD; the income may then be taxable in the country where the work is actually done.
- Capital gains fall outside profits tax, and dividends paid by a Hong Kong company are not taxed in Hong Kong. Shareholders remain taxable under the rules of their own country of residence.
- For the year of assessment 2025/26 the government waives 100% of profits tax up to HK$3,000 per case.
General information, not tax advice. Your position depends on your circumstances.
Banking fit
- Hong Kong banks look for a genuine connection to Asia: suppliers, customers, staff or management. Companies without one should expect more questions.
- Moderate- and higher-risk sectors can be banked, but onboarding takes longer and the bank may set minimum balances.
- EMIs and multi-currency providers can complement a traditional account for payments; each provider decides after its own checks.
Questions
How long does it take to set up a Hong Kong company?
Electronic incorporation certificates are normally issued within one hour of a complete filing. In our experience the full setup, including documents and the secretary appointment, takes about a week; bank onboarding is a separate step that usually takes longer.
What is the corporate tax rate in Hong Kong?
Corporations pay 8.25% on the first HK$2 million of assessable profits and 16.5% above that. Only one entity in a group of connected entities can use the lower tier.
Can a Hong Kong company pay 0% tax on foreign income?
Profits that do not arise in Hong Kong are not taxed there, but the company must show where the profit-producing work was done. The Inland Revenue Department reviews offshore claims, and the income may be taxable elsewhere.
Do I need a local director in Hong Kong?
No. Directors can be of any nationality and live anywhere. The company secretary, however, must be an individual ordinarily resident in Hong Kong or a company with an office there.
Is opening a Hong Kong bank account difficult?
It is demanding rather than impossible. Banks focus on substance and the business model, and some sectors are classed as higher risk. Every application is subject to the bank's own due diligence, and timelines vary by institution.
Do Hong Kong companies need an audit?
Yes. Hong Kong limited companies have their annual accounts audited by a Hong Kong practising accountant, and the audited accounts support the profits tax return.
Banking in our network
We do not publish institution names: the right partner depends on your profile, and each institution keeps its own view on who it will serve.
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Banking partners
- Hong Kong banks onboard carefully, particularly for trading, FX-related, commission-based or crypto-adjacent businesses, which they often class as higher risk. Approval is subject to each institution's due diligence.
- Expect questions on substance: who runs the company, where customers and suppliers sit, and how money moves. A clear business narrative shortens the process.
- Our network includes corporate, private, EMI and multi-currency institutions; start with the banking assessment to see where your profile fits.
Questions
Is Hong Kong a tax haven?
No. Hong Kong taxes profits sourced there, at 8.25% on a corporation's first HK$2 million and 16.5% above. Profits sourced elsewhere may be exempt, but the claim must be supported, and those profits may then be taxable where they arise.
Can a foreigner own 100% of a Hong Kong company?
Yes. Non-residents may incorporate and wholly own a Hong Kong limited company. The company needs at least one director who is an individual and a company secretary based in Hong Kong.
Can I move my existing company to Hong Kong?
Since 23 May 2025, non-Hong Kong companies can apply to re-domicile while keeping their legal identity, if their home law allows it and they meet solvency and integrity conditions. Approval normally takes two weeks; the company then has 120 days to deregister abroad.
Sources
- 1.Inland Revenue Department: Profits Tax rates, retrieved 2026-10-25
- 2.Inland Revenue Department: FAQ on the two-tiered profits tax rates regime, retrieved 2026-10-25
- 3.Inland Revenue Department: A Brief Guide to Taxes 2025-2026, retrieved 2026-10-25
- 4.Companies Registry: How to register a new company, retrieved 2026-10-25
- 5.Companies Registry: FAQ on incorporation of local limited companies, retrieved 2026-10-25
- 6.Companies Registry: Company re-domiciliation regime FAQ, retrieved 2026-10-25
- 7.news.gov.hk: Re-domiciliation applications open (23 May 2025), retrieved 2026-10-25
- 8.GovHK: Tax rates of profits tax, retrieved 2026-10-25
- 9.Redomiciled case experience: Hong Kong company setups (internal), retrieved 2026-10-25
Reviewed by the Redomiciled team on .
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