Hong Kong Companies for Tax Free Trading
The advantage of Hong Kong is that it is major trading hub. It is not blacklisted anywhere or known as an offshore jurisdiction.
A Hong Kong Company can easily trade and open bank accounts around the world without any problem.
Hong Kong is home to some of the world’s best and most efficient banks. You can hold as many foreign currencies as you want and exchange them whenever you need to.
Hong Kong does not tax foreign profits of companies. There is no difference between local controlled companies and foreign controlled companies. There are no taxes on dividends or capital gains either. Any profits made in Hong Kong are taxed at 16.5%.
Hong Kong Companies are used for:
Hong Kong is an ideal banking jurisdiction. You can bank in whatever currency you want. The banks are highly efficient. You can have precious metal accounts too. Exchange rates for foreign currencies are amongst the most competitive anywhere. There are no taxes on bank interest in Hong Kong.
There is a good selection of brokers in Hong Kong. You can invest anywhere in the world from Hong Kong. The investment profits will not be taxed in Hong Kong.
One of the most common uses of a Hong Kong Company is for trading in goods. If your Company buys goods in China and ships them to Europe or the US there will be no tax due on the profits generated as the goods did not touch Hong Kong. The profits can still be booked by the Hong Kong Company. This could be an ideal structure for Amazon FBA sellers looking to reduce taxes.
A Hong Kong Company can own local or foreign real estate. Owning real estate via a Company protects it from legal actions and makes it easier to transfer as you can transfer the shares in the Company to the new owner of the property. Rental income can be received tax free.
Income from royalties, mineral rights, publishing, consulting fees and so on can be received tax free in Hong Kong.
Hong Kong Companies are often used for re-invoicing. This is where the Hong Kong Company will buy goods from a Company in one country and sell them on to a Company in another country. The Hong Kong Company will book the profit which will be tax free in Hong Kong. The profit generated by the other, connected companies is subsequently reduced.
As you can see there are many and varied uses for a Hong Kong Company. It’s much more likely to be accepted as a normal trading Company in other jurisdictions. It will appear much less suspicious than a Belize Company, for example, when dealing with international counterparties.
If you’d like us to help you form a Hong Kong Company email email@example.com