There are several types of Hong Kong renewals and obligations that the company is obligated to follow.
After a Hong Kong company has opened, the company filings do not end there. Apart from the annual return that needs to be filed every year, there are other company renewals and requirements for the company that has to be fulfilled as well on a yearly basis or within a time period.
The Yearly & other Requirements of the Hong Kong Limited Company
- Renewal of any documents, forms, licenses or permits has to be done one month prior to the expiration date.
- The Business Registration Certificate has to be renewed one to three years post-incorporation. This will depend on the certificate issued.
- The Initial Annual Audit has to be filed after 18 months of the incorporation date unless the company has unlimited liability.
- IRD (Inland Revenue Department) tax filing for the new companies falls after 18 months of the incorporation date.
- The annual return, which includes the lists of directors and officers has to be filed within 42 days of the initial registration date anniversary the next year. Startupr reminds you of this two months before the deadline.
- The AGM, also called the Annual General Meeting has to be held within 9 months after the first anniversary of the company’s incorporation; or 3 months after the end of that accounting reference period, whichever is the later, at the place and time where the directors announce it.
Type of renewals
There are several types of Hong Kong renewals and obligations that the company is obligated to follow. These have been shared below:
Filing Annual Return to the Companies Registry
As per the rules in the Companies Ordinance, each of the Hong Kong companies has to file the Annual Return regularly every year in the prescribed form. The form that is used is called the NAR1 form. The contents of this form include the particulars of the issued share capital, registered capital, registered office, secretary(s), director(s), shareholder(s), etc.
The annual return has to be filed within 42 days of the anniversary date of the incorporation of the company every year, and it is a compulsory obligation. In case a person forgets to file the annual return, they would be liable to pay the late fines depending on how late the filing has been done. The appropriate late fees charged are as follows:
- more than 42 days after but within 3 months after the company’s return date: HKD 870
- more than 3 months after but within 6 months after the company’s return date: HKD 1,740
- more than 6 months after but within 9 months after the company’s return date: HKD 2,610
- more than 9 months after the company’s return date: 3,480
If there is an application given by the company for the discontinuance of business in Hong Kong, the company would be exempted from the filing process and other HK renewals. And the failure to comply with the rules of the Companies Ordinances may ultimately lead the company and its head to the court.
Renewal of The Business Registration Certificate
This is one type of the Hong Kong renewals where the Inland Revenue Department, also called the IRD would issue the demand notice about one month before the expiry date of the Business Registration Certificate for the business. As soon as the payments come in, the demand notice would be the valid renewed Business Registration Certificate.
In case the company does not receive a demand notice within one month of the expiry date, the company has to notify this situation to the commissioner of the IRD. In case there isn’t any settlement after the expiry date, the penalty fee of HKD 300 would be charged to the client. Moreover, there isn’t any relief policy in this where the basic renewal fee is HKD 2,150 per year.
A company can also choose to get the registration certificate with a validity of one year or three years, for which they would have to renew it accordingly as well.
BRC (Business Registration Certificate)
For the registered business, the business registration renewal demand notice would be sent to the address of the company office that has been registered with the Companies Registry, approximately one month before the current Business Registration Certificate expires.
After this business registration renewal demand note has been paid, this demand note will become the valid business registration certificate, which would display the date of payment, receipt number and amount paid. The certificate would also show the valid “date of expiry” and other current company particulars. This business certificate would need to be displayed at the business address for the company.
If the company has commenced business or changed it’s company particulars from the time of the last Business Registration Certificate, the company would need to notify the IRD in regards to the update information. This may be for the commencement of business, business address, business name, company directors and members and business nature.
Annual General Meeting
It is compulsory for each company to hold at least one general meeting, which is also called the Annual General Meeting each year as per the Companies Ordinance. Though this is not one of the company renewal filings, it is an obligation that has to be fulfilled on a yearly basis.
Profit Tax Reporting
It is normal for a company to get its first profits tax return within the 18 months since the commencement date of the business. After that, the next tax return forms would usually be issued on the 1st of April each year (or the first working day of April every year.)
For the businesses that have been ceased, are yet to commence the business, gain no chargeable profit, or are yet to recommence business, the IRD would not request them to submit the tax return form annually. The first profits tax return would have to be filed with the IRD in 3 months since the issuance date.
Along with this, an audit report has to be attached. In the next years, in case there is no tax representative to act on its behalf for submitting the form for an extension, the company has to file the tax return within a month.
Annual Audit and Auditor
As per the Companies Ordinances, each business has to appoint an auditor to audit its account annually. The appointed auditor must be Hong Kong CPA (Certified Public Accountant).
The role of the CPA would be to verify the accounts of the company, and determine the assessable profits and taxes payable, if any. Normally they would also fill out the Profits Tax Return, and submit these together with the Audit Report to the government.
The directors would appoint the auditor for the company, and they would remain as the auditor unless another auditor is appointed.
Employer’s Return for Remuneration and Pensions
This is another type of the Hong Kong renewals where the IRD takes records of returns of the employers in each tax year for the company’s employees. This also includes the remuneration of the directors that is paid for the personal income tax for an individuals taxation.
Therefore, when the company receives the employer’s return (Form BIR56A and 56B), the company has within one month to complete and return the same form to the IRD, even if:
- The company has not employed any staff.
- The company has not started the business still.
- The company has ceased the business or has closed down the firm.
The Business Registration Certificate is due for one of the HK renewals around one month of its expiration date. The business registration fee for a business currently is HKD 2150 per year, and the late renewal penalty fee is about HDK 300 and can increase with time and a court prosecution.
For a Hong Kong company, the amount that has to be paid for the first registration certificate is based on the delivery date of the associated incorporation submission to the Companies Registry, and the date of incorporation is the same as the initiation date of the registration certificate.
To renew the certificated, the payable amount is decided based on the commencement date of the applicable registration certificate.
Startupr offers a complete package for the renewal of all the services. The renewal of the Company Secretary package is $900 USD, and it holds the following services:
- Registered Address $0 (Free of Charge)
- Startupr as an Agent or Company Secretary – $285/annum
- Renewal of Business Certificate (Government fees) & Lodgement Fees of the Business License $310 – Government Fees
- Business Certificate filing $95
- AGM $60
- Filing of Annual Return and e-Certificate (NAR1) $ 105 USD (Gov. Fees of $ 25 USD included)
- Designated Representative (for Significant Controllers Registers – SCR only) – $ 45 USD/1 Year
Note: A company can apply for the business registration certificate with the 3-year validity period. Also, in case you wish to apply for the 3-year validity period business registration certificate, you would need to inform Startupr 3 months before the expiration of the business registration certificate that you have at the moment.
If you hire us for our services, Startupr would take care of the renewal of the company secretary and the business registered address package along with the business registration certificate. We will notify you when your company needs to be renewed, and make sure to inform you of all the government filings you need in order to have the company in good standing. We make all the paperwork easy and let you focus on running your business!