Company setup in Hong Kong for Indian businesses
A private company under the Companies Ordinance, with a territorial two-tier profits tax and a treaty with India — well suited to Asia-facing trade and sourcing.
Hong Kong suits Indian businesses that buy from or sell into Asia. It has no VAT or GST, taxes only profits sourced in Hong Kong, and has had a comprehensive double taxation agreement with India since 2018. In return it expects good governance: every company has a local company secretary and an annual audit.
Key facts at a glance
| Company type | Private company limited by shares under the Companies Ordinance (Cap. 622) |
| Directors & members | At least one director who is a natural person and at least one member; any nationality |
| Company secretary | Mandatory — an individual ordinarily resident in Hong Kong or a Hong Kong body corporate; a sole director cannot also be the secretary |
| Profits tax | 8.25% on the first HKD 2 million of assessable profits and 16.5% on the rest (one entity per connected group uses the lower tier) |
| Tax basis | Territorial — only profits arising in or derived from Hong Kong are taxed; an offshore claim depends on the facts and must be supported. Under the foreign-sourced income exemption regime, certain offshore passive income received in Hong Kong by members of multinational groups can be taxed unless an exception is met |
| Audit | Annual financial statements audited by a Hong Kong certified public accountant (dormant companies excepted) |
| Annual filings | Annual return within 42 days of each incorporation anniversary; significant controllers register kept at the company |
| Indirect tax | No VAT or GST |
| India link | India–Hong Kong DTA signed 19 March 2018, in force 30 November 2018, effective in India from FY 2019-20 |
Best suited for
- Sourcing from China and South-East Asia
- Regional trading and invoicing
- Holding Asia-facing contracts and IP
- Businesses needing a reputable common-law jurisdiction
What we handle
- Incorporation and business registration, with company secretary and registered office provided through a licensed Hong Kong trust or company service provider
- Significant controllers register and annual return
- Bank account introduction and KYC pack
- Bookkeeping, audit coordination and profits tax return
- ODI filing in India, the APR and Schedule FA
The Indian side
A Hong Kong company owned by a resident individual must meet the ODI conditions, and its audited accounts provide the basis for the Annual Performance Report due by 31 December. Where management and control sit in India, the company could be treated as resident in India under the place of effective management test — so board decisions should be taken where the business is genuinely run. See ODI & FEMA compliance.
Sources: Companies Ordinance (Cap. 622); Inland Revenue Ordinance (Cap. 112) and IRD guidance on two-tiered profits tax rates; Companies Registry guidance on directors and company secretaries; Business Registration Ordinance (Cap. 310); India–Hong Kong Comprehensive Double Taxation Agreement (2018).
Ready to set up in Hong Kong?
We aim to reply within one business day with initial observations and next steps.