Why Hong Kong is the Best option to Open a Company – SK Patodia

Why Hong Kong is the Best option to Open a Company

Hong Kong was earlier a British colony. In 1997 it became a Special Administrative Region (SAR) of China and is an independent territory. It is famous for its lush green hill slopes, alluring beaches, recreational landscape and shorelines. It maintains separate managerial and judicial powers from China. It is located in the south-eastern region of China. Hong Kong has a good affiliation with the foreign nations through the World Trade Center, Asia-Pacific Economic Cooperation (APEC) etc.

Benefits of Setting up a Company in Hong Kong

    1. Financial: It is considered to be one of the best financial centres in the world. Its economy is the 3rd most stable across the globe. It is the 2nd largest recipient of FDI. It had an inward direct investment of $1.59 trillion and outward direct investment of $1.58 trillion.

    2. Private Equity: It is the 2nd largest private equity centre in Asia accounting to approximately 19% of the total capital. Majority of the equity business is from Foreign Investors.

    3. Banking System: It is one of the most stabilized banking systems across the globe. It also allows dealing with multiple currency accounts.  The recent asset under management (AUM) accounted for around USD 471 billion.
    4. Strategic Location & Transport: It is located in close proximity to China it provides a gateway to the Chinese market and It also has efficient access to waterways due to the large coastline. It has the world’s 5th busiest port and the Hong Kong International Airport is the 8th busiest.
    5. Taxation: The corporate tax rate is 16.5% which is less as compared to other territories. There are no capital gain taxes and withholding taxes on income received as interest, royalty and dividends. They only levy a tax on the income generated from operations in Hong Kong. The foreign income even if it is received in Hong Kong is not taxed.
    6. Renminbi Business: It is the Global Hub for Renminbi Business. The daily flow accounts nearly RMB 100 million per day. All the banks in Hong Kong provide Renminbi facilities. It has become one of the crucial aspects of cross-border transactions.
    7. Language: English is used as the official language of Hong Kong and all the documentation are done in English. This reduces the barrier of language which is a vital aspect while selecting a territory to open a new company.

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