Annual Compliance For Hong Kong Private Companies

During the lifetime of incorporation in Hong Kong, your private limited company in Hong Kong must comply with some obligations regulated by the government. The main obligations comprise general and filing requirements.

1. General requirements

These obligations mainly relate to the maintenance of your company in Hong Kong:

1.1. Maintenance of company secretary and registered address

In order to be set up and put into operation, your company in Hong Kong is required to have at least one director, one local company secretary and a registered office address. These must be maintained throughout the lifetime of incorporation of your company.

Since all directors in Hong Kong can be foreigners, you can take on this position and need not hire any nominee director.

If you do not have any local company secretary to register for your company, you need to appoint one (using outsourcing service) and each year, you need to pay a fee to retain this position in your company. Similar to the address of the company, you need to pay a fee for renewal to remain the address each year.

1.2. Accounting and auditing

Under Companies Ordinance, your Hong-Kong-registered companies is required to prepare and maintain financial records and have the financial statements audited.
If your company is short of resources to perform such accounting and auditing tasks, you can look for a qualified accounting firm.

1.3. Renewal of Hong Kong business registration

You need to make a payment for the renewal for your business registration on an annual basis or once every three years basing on the business registration certificate of your company is valid for one or three years.

A notification for business registration renewal will be sent to your company by a related government agency a few weeks before the starting month of the renewal business registration certificate.

1.4. Maintenance of company’s internal records

It is advisable for your company to maintain the following documents:

o Certificate of Incorporation (CI)
o Certificate of Business Registration (BR)
o Articles of Association (AA)
o Records of resolutions, minutes of all meetings
o Updates of financial records (retained for seven years from the transaction date to avoid penalties)
o Company seal
o Share certificates
o Registers of members and directors
o Business licenses (if any).

Documents containing information about members, resolutions and meetings need to be kept for no less than 10 years.

Note: Your company must notify the Companies Registry, normally within 15 days, any changes of the following information:

o Registered office address
o The status of the company secretary and directors
o Information about the secretary and directors
o Company name
o The allotment or issuance of new share

1.5. Annual general meeting (AGM)

Your company must hold the first annual general meeting within 18 months from the date of incorporation. For each subsequent year, your company has to organize an annual general meeting. Remember: the time period between holding an AGM and the next one must not exceed 15 months.

At such meetings, the company must present the director’s report along with the company’s financial accounts to its shareholders. These documents must be prepared in compliance with the Financial Reporting Standards framework in Hong Kong.

2. Filing requirements

The filing requirements mainly include filing annual returns with the Companies Registry (CR) and filing annual tax returns with the Inland Revenue Department (IRD).

2.1. Filing annual returns with CR

An annual return must be submitted, online or offline, to CR containing main information about your company, such as registered address, directors, shareholders and company secretary. The timeframe to file an annual return is 42 days from the anniversary date of incorporation. Your company may be subject to a severe fine if it fails to comply with such a filing requirement.

2.2. Filing annual tax returns with IRD

Your company must submit an annual tax return, online or offline, to IRD within one month after receiving the notification sent by this agency. Along with a tax return, the following supporting documents need also be sent:

o Company’s balance sheet;
o Auditor’s report;
o Profit and Loss account of the basis period;
o A tax computation illustrating how assessable profits or adjusted losses have been calculated.

The above are the overall requirements that your private limited company must comply with when incorporating in Hong Kong. In order to save time and your resources, you can opt for outsourcing services from a reliable provider to help your company stay compliant.