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Question Thinking about incorporating in Hong Kong

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Naka

New member
Hi guys, I have been playing with the thought of incorporating a limited in Hong Kong for a while.

Normally I am from Germany and the equivalent would be a GmbH. However, to make one 12.500€ would be required in the beginning and besides this there are higher taxes, more paperwork and more kinda taxes. My residency is in Germany, but I am only staying there for 1-2 months per year. Mostly I am in Asia (Thailand, China, Korea and Japan). Also visited Hong Kong and Singapore many times and I prefer HK. Since my main business is app developing (mostly get paid from Facebook, Apple and Google) but would also like to sell and export goods from China. In fact I already know some manufactures in Shenzhen, etc.


I would use Neat.hk offer to incorporate + getting their bank acount. On there I would just receive all the payments I get from Facebook, Google and Apple. Later on I would probably make a real bank account and start importing/exporting/selling goods to Europe and North America.

Since I am quite a newbie to business I have several questions:

1. Do I have to give up my german residency, because they would tax the HK Limited like a german GmbH if german authorities think I am running the business while I am in Germany (even tho I am in Germany only 30-60 days per year)?

2. If I am the CEO of the HK Limited, could I easily apply for business visas in other countries such as Thailand, China or HK?

3. In general, is it a good idea to incorporate in HK, if I am in the app developing business and later wanna source and sell products from China?

4. If I incorporate in HK and become the CEO of the HK Limited, would HK report this to Germany? I don't plan to pay myself any salary in the first year, instead reinvesting most of the money.

best regards
 

LoveMyLife

Active Member
1. Yes. As long as you hold at least paper residency in Germany, you are german tax rasident and all companies directed by you will be considered to be a german tax resident. So you have to give up your residency there. As long as you are citizen of Germany, you can come to Germany just with passport.. If you do not have a chldren attending a school in Germany, there is no reason to have a residence permit there, if you can live most of the year overseas.

2. Having business in HK does not mean, you can apply for visa in any of countries you mentioned. Thailand has Elite visa program. It is expensive, but if you can afford it, you can live there. China - forget about it. Hong Kong - if you want to have a HK company, you shall not apply for visa in HK. If you do that, your HK company will become full tax resident of Hong Kong and will be tax in Hong Kong on its worldwide income.

3. Generaly, yes. Depends on amount of transactions. Accounting and audit are very expensive in HK. If you will receive payments from all sources one per month, it can work. If you will receive payments on a day basis, costs can be too high.

4. Just in case if you in tax exemption certificate application file germany of place of directors residence. It is bettet to obtain residence permit in some country with territorial taxation forst, and incorporate HK company afterwords. If you will be able to prove having residence visa in Thailand, they will report it to Thailand.
 

Naka

New member
2. Having business in HK does not mean, you can apply for visa in any of countries you mentioned. Thailand has Elite visa program. It is expensive, but if you can afford it, you can live there. China - forget about it. Hong Kong - if you want to have a HK company, you shall not apply for visa in HK. If you do that, your HK company will become full tax resident of Hong Kong and will be tax in Hong Kong on its worldwide income.
I mean not resident visa, but business/work visa. For example, if I deal with chinese suppliers/manufactures it shouldn't be a problem to apply for a business visa since I am working with chinese companies, right?

You mean if I apply for visa in HK they me to pay income tax in HK? Otherwise I only need to pay the corporate tax, right?

4. Just in case if you in tax exemption certificate application file germany of place of directors residence. It is bettet to obtain residence permit in some country with territorial taxation forst, and incorporate HK company afterwords. If you will be able to prove having residence visa in Thailand, they will report it to Thailand.
At the moment I am just using tourist visas all the time to go around in Asia. I would first incorporate the HK company and after this give up the residency in Germany.
 

LoveMyLife

Active Member
I mean not resident visa, but business/work visa. For example, if I deal with chinese suppliers/manufactures it shouldn't be a problem to apply for a business visa since I am working with chinese companies, right?

You mean if I apply for visa in HK they me to pay income tax in HK? Otherwise I only need to pay the corporate tax, right?


At the moment I am just using tourist visas all the time to go around in Asia. I would first incorporate the HK company and after this give up the residency in Germany.

Any kind of work visa in China will make you chineese tax resident and you will have to pay there taxes from all your worldwide income. And you will also have to pay corporate tax fro all foreign companies in China, also.

If you will have a HK visa, you will have to pay corporate tax of HK company. Dividends will be paid to you tax free. All other income from a foreign country will be tax free as long as it is pasive. All active income - as income of sole proprietor, will be taxed in HK.

If you incorporate first, and you apply for corporate tax exemption, HK tax office will inform Tax administration of Germany every year.. Change how you will do it.. Obtain residence permit on some territorial tax country first and incorporate a company in HK afterwords.
 

Naka

New member
Can someone else go along with the info above?

From what I know I can apply the tax exemption status two years after incorporation, until then I would need to pay the 8,25% profit tax (until I hit the limit) anyway for corporate tax, no matter where I live, I don't necessarily need a HK visa to pay corporate tax from what I know.

Would be nice to hear more information, also from other guys who incorporated in Hong Kong.
 

TRX

Corporate Services
Mentor Group Gold
Elite Member
They won't be less paperwork in Hong Kong it is a joke with the HK company formation service, furthermore you risk your company to be in bad standing if you don't pay their ridiculous high accounting, auditing and other shitty fees.

Search the forum for HK formation there is lot's of info already.

Code:
site:offshorecorptalk.com hk company
 

Naka

New member
They won't be less paperwork in Hong Kong it is a joke with the HK company formation service, furthermore you risk your company to be in bad standing if you don't pay their ridiculous high accounting, auditing and other shitty fees.

Search the forum for HK formation there is lot's of info already.

Code:
site:offshorecorptalk.com hk company
Hi, first of all, thanks for your reply.

Basically, I incorporate to receive the money I make from ad networks such as Adsense, Facebook, Unity and some other networks. I can decide how often they are going to pay me, so I can keep the number of transactions low if I want to.

From what Neat told me I can choose any accountant I want to work with. I know there are many companies providing incorporation + auditing services for a delusional price. A complete rip off in my opinion.

I will contact Neat know to ask for the ongoing costs of their address, secretary and also the prices of their accountant/auditing team.
 

erni

Mentor Group Gold
I will contact Neat know to ask for the ongoing costs of their address, secretary and also the prices of their accountant/auditing team.
ask them so make sure you get some guarantess or something.

HK is a total RIPP OF if you ask me. It's for the big players not for the average joe.
 
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