Viewpoints

1. Nature of Employer’s Return The Employer’s Return is issued by the Inland Revenue Department every year for the purpose of reporting the amount of remuneration, including salaries, wages, commission etc., paid to each employee during a year of assessment, that is, for a year running from April 1 to 31 March next year. 2. Filing of Employer’s Return The Employer’s Return for a year of assessment is issued to all employers on the first working day of a year of assessment preceding to the year if assessment concerned. All employers are required to furnish the return within one month from the date of issue, unless an application for extension in writing is filed with the Inland Revenue Department (IRD) on or before deadline for submission. A complete set of annual employer’s return of remuneration and pensions contains a form BIR56A and forms IR56B. Before you complete the return, you […]

The transfer of legal title to shares in a Hong Kong company is affected by an “instrument of transfer”. Beneficial title to shares is transferred by way of contract notes (a bought note and a sold note). Contract notes must be submitted for stamping within two days (30 days if the sale takes place outside Hong Kong) of their execution. Ad valorem stamp duty is levied on each contract note (i.e. both the bought note and the sold note) at the rate of HK$1.00 per HK$1,000 or part thereof, of, whichever is the higher of the consideration paid or the value of the shares transferred (so that the total rate of duty on a sale of shares is effectively 0.2%) . Exemptions from stamp duty are available for intra-group transfers. We will be pleased to provide more detailed advice on the requirements for exemption on request. In the case of […]

The issuing of new shares in a company is a three-stage process involving the allotment by the directors of the shares to particular persons and then the issuance of the shares to such persons after the entering into the company’s register of shareholders of the relevant particulars. Allotments of shares, other than allotments pursuant to offers to existing shareholders pro rata to their existing holdings, may only be made with the prior approval of the shareholders in general meeting. This approval may be given either in relation to a particular allotment or allotments or generally. In either case this shareholder approval expires (if not previously revoked by the company in general meeting) when the next annual general meeting of the company is held or ought to be held. A return of allotment of shares, disclosing the members and their shareholdings must be filed with the Registrar within one month of […]

1. Content of the Memorandum and Articles of Association This must contain – (a) The name of the company. (b) The Memorandum must also include a declaration as to liability, (c) Perhaps the most important aspect of the Memorandum is what is generally referred to as the Objects Clause. (d) A Capital Clause: (e) The Association Clause 2. Content of the Articles of Association These are the rules for the internal management of the company. There are standard form articles in Table A of the Hong Kong Companies Ordinance as amended and these can be used and altered as the need arises. 3. Procedures for amendment of Memorandum and Articles of Association Most of the provisions of a company’s memorandum and articles of association can be changed by special resolution. There are exceptions to this general rule. Where a company has issued different classes of shares, the special rights of […]

1. General Requirement on Company Name The name of a Hong Kong company could be in English only or Chinese only or in both English and China. If the name is in English, it must be ended with “Limited”, and if in Chinese, be ended with “有限公司”. 2. What is Change of Name? The change of English name changes of Chinese name, addition of English name or addition of Chinese name are all regarded as change of company name and must go through the same procedures. 3. Procedures for Change of Name To effect a change in the name of a company (which includes the adoption or abandonment of a formal English or a Chinese version of the name): (1) the shareholders must approve of the change in name by special resolution (2) the new name must then be registered with the Registrar. It normally takes about 10 working days […]

1. Filing of Changes of Particulars A company must file the relevant particulars with the Registrar within the period indicated, in the event of: (1) any change in the directors or secretary or in the filed particulars of any existing directors or secretary – 14 days (2) any change in the location of the registered office – 14 days (3) any increase in the authorized share capital (this also requires the payment of a capital fee) – 15 days (4) any relocation of the company’s statutory books from the company’s registered office – 14 days (5) any change of name of a company – 15 days after the passing of the resolution (6) the passing of a special resolution (other than special resolutions to change the name of a company) or certain other resolutions – 15 days (7) any allotment or issue of new shares (this also requires the payment […]

1. Internal Record Keeping Requirements (1) Annual accounts/directors’ report A profit and loss account and a balance sheet for the company must be audited by Hong Kong registered auditors and laid before the shareholders in general meeting within 18 months of incorporation and then at least once in every calendar year. There are lengthy and detailed provisions in the Companies Ordinance regarding the types of accounts to be prepared and we can supply further details on request. Generally, Hong Kong private companies having a share capital are not required to file their accounts with the Registrar. A directors’ report must be prepared in conjunction with the annual accounts. The Companies Ordinance provides a list of what this report should contain, and this list includes details of contracts with the company or certain companies with which it is associated which are significant in relation to the company’s business and in which […]

1. Introduction With the implementation of the new Companies Ordinance, the concept of authorized capital and nominal value has been abolished. All company shares will cease to have a nominal or par value, whether issued before or after the Commencement Date. Any provisions in a company’s constitution which state the amount of the company’s authorized capital and the nominal or par value of its shares will be regarded to have been deleted from the constitution. The nominal or par value amount of issued shares, together with the amounts standing in credit to the share premium account and the capital redemption reserve, will form the share capital. 2. Abolition of Par Value (1) Authorized capital and nominal value of shares The authorized capital represents the maximum sum that a company could raise by issuing shares and is expressed as the sum of a specific number of shares of a fixed amount […]

1. Introduction It is not a requirement that you have to set up the bank account in Hong Kong for your Hong Kong company. Indeed, there is no requirement that you even have to set up a bank account for your Hong Kong company. It is the sole discretion of the company, more specifically, the powers of the director or board of directors of a Hong Kong company to decide whether to open a bank account, where to open the bank account and the number of bank accounts required. 2. Banks Available in Hong Kong For the interest of our clients, we have enquired the banks listed below on the requirements for the opening of a corporate account with them. It is noted however that you can choose any other bank to open the bank account for your company. 1. Standard Chartered Bank: www.standardchartered.com (1) All directors, shareholders and bank […]

(Unless otherwise stated, Hong Kong company refers to private limited liability company incorporated in Hong Kong) 1. Procedures to Purchase a Readymade (Shelf) Hong Kong Company. When you engage Kaizen to incorporate a Hong Kong company for you, please follow the procedures described below. The following procedures apply to situations where clients purchase a readymade (shelf) company from Kaizen. It is assumed that the registered office and company secretary are to be provided by Kaizen. Step 1: Client places an order for incorporation with Kaizen with payment of incorporation fees. Step 2: Kaizen email or fax the readymade company list to client for his selection. Client selects at least two names in order of preference and confirms with Kaizen. Step 3: At the same time of confirming the selected names, client provides the following documents and information to Kaizen by email or fax or post: In the case that Registered […]