Hong Kong Residence Permit

[blancmon229]

Is there any easy solution to get a HK residence permit?

Can you get a residence permit from setting up a company in HK and hiring yourself as a director or employee. In that way you would get an employement visa, I am assuming? How long would it last if possible?

Willing to spend 10k euros max.

 

[uranium]

Is there any easy solution to get a HK residence permit?

Can you get a residence permit from setting up a company in HK and hiring yourself as a director or employee. In that way you would get an employement visa, I am assuming? How long would it last if possible?

Willing to spend 10k euros max.

If you are looking for dubai alternative, I'm afraid to inform you that HK has personal income tax, around 15% or a bit more
So if you setup business, and you distribute dividend to your self. You pay tax on personal income.
In that case better stick to Dubai at 9% tax rate.

 

[thomasparra]

If you are looking for dubai alternative, I'm afraid to inform you that HK has personal income tax, around 15% or a bit more
So if you setup business, and you distribute dividend to your self. You pay tax on personal income.
In that case better stick to Dubai at 9% tax rate.

Not quite accurate unless you make a few millions in HKD in salary per year. On 70,000-90,000 HKD per month, you can expect around 10-12% in personal tax.

Besides as I understand it dividends are generally not taxable. Dividends paid from profits that already have been subject to Hong Kong tax are not taxable in the hands of shareholders.

Corporate tax is only 8.25% up to 2M HKD in profit (roughly equals to 250k USD) It hits 16.5% above that 2M threshold

For 22-23 tax year, you can pay yourself a salary of 300k HKD per year, and you would pay 9000 hkd in tax. This is 3%, not 15%. For the rest you can pay yourself in dividends after paying corporate tax (8.25% on the first 2M). You have a lot of wiggle room to pay low tax in HK. You will pay less tax in Dubai for sure but it's also much more expensive to set up a company, and maintain it.

 

[MaxFS]

In addition, you have to pay for annual audit, often price for the service also depends on amount of income.

 

[uranium]

Not quite accurate unless you make a few millions in HKD in salary per year. On 70,000-90,000 HKD per month, you can expect around 10-12% in personal tax.

Besides as I understand it dividends are generally not taxable. Dividends paid from profits that already have been subject to Hong Kong tax are not taxable in the hands of shareholders.

Corporate tax is only 8.25% up to 2M HKD in profit (roughly equals to 250k USD) It hits 16.5% above that 2M threshold

For 22-23 tax year, you can pay yourself a salary of 300k HKD per year, and you would pay 9000 hkd in tax. This is 3%, not 15%. For the rest you can pay yourself in dividends after paying corporate tax (8.25% on the first 2M). You have a lot of wiggle room to pay low tax in HK. You will pay less tax in Dubai for sure but it's also much more expensive to set up a company, and maintain it.

Not accurate either
If you make 100k$ per Year, you pay 5% in personal income.

$ 100,000 income tax calculator 2024 - Hong Kong - salary after tax

If you make $ 100,000 in Hong Kong, what will your income after tax be? The Talent.com Online Salary and Tax Calculator can help you understand your net pay.

hk.talent.com

If you make 300k$, it would be 18% personal income tax.
It is progressive tax model which is worst for big businesses.
If your business generates more than 254k$ a year, it is 16.5%.
If we suppose you make max 100k$, I think you will pay 8.25% corporate + 5% personal which is much higher in dubai.
Maybe if you can prove to hk authorities that you have foreign income and pay only personal income tax only.
Is dividend distribution taxed?

 

[blancmon229]

If you are looking for dubai alternative, I'm afraid to inform you that HK has personal income tax, around 15% or a bit more
So if you setup business, and you distribute dividend to your self. You pay tax on personal income.
In that case better stick to Dubai at 9% tax rate.

I'm more so looking for a residence permit just to have in my back pocket as another residence permit and to open up a bank account there as I am guessing it will probably be easier to do so with one. If you have any solutions for getting a residence permit there let me know.

In regard to the HK company, there are probably cheaper and more effective structures in other countries. I am curious why one would choose a HK company over a Cyp LTD, Bulgarian EOOD, Estonian company or UAE FZ. Any specific advantages?

 

[thomasparra]

Not accurate either
If you make 100k$ per Year, you pay 5% in personal income.

$ 100,000 income tax calculator 2024 - Hong Kong - salary after tax

If you make $ 100,000 in Hong Kong, what will your income after tax be? The Talent.com Online Salary and Tax Calculator can help you understand your net pay.

hk.talent.com

If you make 300k$, it would be 18% personal income tax.
It is progressive tax model which is worst for big businesses.
If your business generates more than 254k$ a year, it is 16.5%.
If we suppose you make max 100k$, I think you will pay 8.25% corporate + 5% personal which is much higher in dubai.
Maybe if you can prove to hk authorities that you have foreign income and pay only personal income tax only.
Is dividend distribution taxed?

I would use the official HK tax simulator versus a random website. For 100k, 0 tax payable as seen below.

On a 1M salary, 12.9% in tax. I also did not even deduct retirement contributions and other deductions (granted there are not many in HK).

You cannot pay more than 15% tax in HK, even if your income is hundreds of millions of HKD. You can try this out with the official tax simulator as well. I am not sure where you saw 18%.

Dividends are not taxed if you are a resident of HK. OP is looking at 8.25% tax up to $2M HKD (=254k USD) in PROFIT. If he pays himself a salary of about 500k or less, his personal taxe rate should be under 8%, therefore helping him decrease his overall tax rate (personal + corporate).

The numbers are here, happy to run another scenario if I am given numbers.

Also, lots of reputable and cost effective options for accounting and annual auditing (should could around 100 USD per month unless the OP is generating a lot of revenue and/or business with intricate and complicated accounting methods). Please compare the costs to UAE where the starting and maintenance costs are MUCH higher, and on the rise year over year (especially in the Freezones). Also, UAE is looking to generate more tax revenue to sustain their Dubai vision 20XX plans. I would not be surprised if they introduce personal tax at a later point. HK on the other hand is well funded, and runs large budget surplus every year. You can see the historic tax policing of the city and realise it has been fairly consistent. The question about HK is more on the politics side of things obviously, but it is still much easier to emigrate and be a tax resident there than SG for example.

 

[fshore]

OP asked about resident permit. Anyone know how much you have to invest to get a Residence permit? I think it's a lot of millions.

 

[thomasparra]

OP asked about resident permit. Anyone know how much you have to invest to get a Residence permit? I think it's a lot of millions.

They wrapped up this investment program in 2015. Now you need to either make at least 2.5M hkd per year or prove you will start your business in HK and have a solid plan to hire local HKers. This route will be easier than SG.

 

[uranium]

I would use the official HK tax simulator versus a random website. For 100k, 0 tax payable as seen below.

View attachment 5337

On a 1M salary, 12.9% in tax. I also did not even deduct retirement contributions and other deductions (granted there are not many in HK).
View attachment 5338


You cannot pay more than 15% tax in HK, even if your income is hundreds of millions of HKD. You can try this out with the official tax simulator as well. I am not sure where you saw 18%.

Dividends are not taxed if you are a resident of HK. OP is looking at 8.25% tax up to $2M HKD (=254k USD) in PROFIT. If he pays himself a salary of about 500k or less, his personal taxe rate should be under 8%, therefore helping him decrease his overall tax rate (personal + corporate).

The numbers are here, happy to run another scenario if I am given numbers.

Also, lots of reputable and cost effective options for accounting and annual auditing (should could around 100 USD per month unless the OP is generating a lot of revenue and/or business with intricate and complicated accounting methods). Please compare the costs to UAE where the starting and maintenance costs are MUCH higher, and on the rise year over year (especially in the Freezones). Also, UAE is looking to generate more tax revenue to sustain their Dubai vision 20XX plans. I would not be surprised if they introduce personal tax at a later point. HK on the other hand is well funded, and runs large budget surplus every year. You can see the historic tax policing of the city and realise it has been fairly consistent. The question about HK is more on the politics side of things obviously, but it is still much easier to emigrate and be a tax resident there than SG for example.

Hong Kong: Guide to Income Tax for Foreigners

Hong Kong’s income tax rates for foreigners along with its corporate tax rates, help create an exceptional business environment.

sleek.com

Hong Kong Tax | Tax Guide For Hong Kong - HSBC Expats

Moving in to or out of Hong Kong? Get in-depth information for expats on different taxes and how to deal with them.

www.expat.hsbc.com

Annual salary over 25k$. You pay 17% in personal income tax.

The normal Profits Tax Rate in Hong Kong is 16.5% for Corporate Income Tax.
This info from here:

Hong Kong's Corporate Tax Rate in 20243: A Beginner's Guide

This guide will cover everything you need to know about Hong Kong's corporate tax rate in 2024, including incentives and how to file your taxes.

statrys.com

So corporate 16.5% + personal 17%
Unless you prove that your income is derived from abroad, then pay your self low salary and get dividends tax free.
Correct me if I'm wrong

 

[thomasparra]

Hong Kong: Guide to Income Tax for Foreigners

Hong Kong’s income tax rates for foreigners along with its corporate tax rates, help create an exceptional business environment.

sleek.com

Hong Kong Tax | Tax Guide For Hong Kong - HSBC Expats

Moving in to or out of Hong Kong? Get in-depth information for expats on different taxes and how to deal with them.

www.expat.hsbc.com

Annual salary over 25k$. You pay 17% in personal income tax.

The normal Profits Tax Rate in Hong Kong is 16.5% for Corporate Income Tax.
This info from here:

Hong Kong's Corporate Tax Rate in 20243: A Beginner's Guide

This guide will cover everything you need to know about Hong Kong's corporate tax rate in 2024, including incentives and how to file your taxes.

statrys.com

So corporate 16.5% + personal 17%
Unless you prove that your income is derived from abroad, then pay your self low salary and get dividends tax free.
Correct me if I'm wrong

The maximum tax rate in HK is 15% as stated on official Gov HK website

GovHK: Tax Rates of Salaries Tax & Personal Assessment

Tax Rates of Salaries Tax & Personal Assessment

www.gov.hk

Also stated on PwC website "The maximum tax for 2022/23, however, will be limited to tax at the standard rate (15%) on the net assessable income after any allowable deductions (see the Deductions section) but without the deduction of personal allowances."

Hong Kong SAR - Individual - Taxes on personal income

Detailed description of taxes on individual income in Hong Kong

taxsummaries.pwc.com

Just use the calculator on the official tax office website, I posted screenshots above. Even at 1M HKD salary you "only" pay 12.9%. Max tax you would paid even if you pay yourself billions is 15% (standard rate). The 17% was probably a top band voted a few years ago but that never really got used as if your tax rate reaches >15%, your income is automatically taxed per the standard rate of 15%. It is similar to the flat tax in some countries where you pay less going with the standard rate than going through the progressive bands.

We don't care about normal corporate tax. The two tier system offers a 8.25% corp tax up to 2MHKD, then the 16.5% kicks in when that 2M threshold is reached. As you said you can prove that income is derived from abroad so technically you could offset completely your corp tax, but I have read it might not be that easy today so let's assume this is not an option for the sake of having the most pessimistic approach possible.

 

[bibing]

About the HK corporate tax don't forget that 16.5% actually apply to the part exceeding 2m HKD.

Lets say you make 3m
You will pay 8,25% on 2m and 16.5% on the exceeding part (1m)

 

[oldtimer2]

Side note: Hong Kong remains grey listed and that causes problems including money transfer issues / restrictions. Best to check carefully how you might be adversely affected by the grey listing.

 

[jafo]

Hong Kong remains grey listed

By who? I'm really curious about this....

 

[oldtimer2]

By who? I'm really curious about this....

EU grey list since 2021... . you can find that with a quick google search . As for the financial impacts of being on the grey list, they are many. Anyway, some institutions are already treating Hong Kong transfers differently. Just flagging so you check with your financial institution/s if they might have any restrictions on Hong Kong related transfers due to the grey listing. I know some do. But you need to ask yours. I expect HK will bend over to get off the list.. it's already been doing it to try and get off the grey list ... and so I expect it to be less friendly destination going forwards. The price Malta paid to get off a grey list was more intrusive data gathering and reporting. Just saying, the places to look these days for the least overheads and compliance burdens are the ones off anyones grey list. That doesn't mean they are squeaky clean as we all know, it just suits the list makers to ignore some places. Georgia is just one example. The USA is another .

 

[daniels27]

Side note: Hong Kong remains grey listed and that causes problems including money transfer issues / restrictions. Best to check carefully how you might be adversely affected by the grey listing.

Then, just move the money from HSBC HK to HSBC US and then do the transfer. But honestly, I am not aware of any issues with money transfers from Hong Kong. The grey list was mainly due to dividend taxation but there are FSIE rules since 1 January. I guess the matter is mainly solved for now.

AND... for the OP. There are many options for residence permit. Please check the website yourself, it mainly depends on your age, qualifications and income.