After the company is incorporated, what is the annual compliance requirements?

A) Company secretary and registered office

It is a requirement of Hong Kong company law that every Hong Kong company engage a Hong Kong resident company secretary to maintain the statutory records of the company. The company is required to have a registered address in Hong Kong and this address must be advised to the Companies Registry for the purpose of delivery of notices and communications by the Hong Kong authorities. Furthermore the company’s statutory records must be retained at the registered office address for periodic inspection by officers of the Companies Registry.

B) Annual Return (Form NAR1)

Every Hong Kong company is required by law to file an Annual Return (Form NAR1) at the Companies Registry on the anniversary of its incorporation. The Annual Return (Form NAR1) details the corporate structure of the company including details of the shareholders, directors and company secretary.

C) Renew Hong Kong Business Registration 

Every Hong Kong company is required to renew its business registration on an annual basis on the anniversary of its incorporation by paying a registration fee to the Hong Kong Government.

D) Accounting and auditing

It is a requirement of Hong Kong law that every Hong Kong company maintains accounting records, prepares annual accounts in accordance with Hong Kong accounting standards and arranges for its accounts to be audited by a Hong Kong registered auditor.

Each company is free to choose any month end as its accounting year end date however the first accounting period can cover a period no longer than 18 months from the date of incorporation. Once the accounting year end date is chosen then the company must produce its accounts every 12 months using the same accounting year end date.

The tax year end in Hong Kong is 31 March and Manson therefore suggest to clients that they select 31 March for their accounting year end date to coincide with the date when tax returns will be issued by the Hong Kong tax authorities.

E) Tax filing

Every Hong Kong company is required to file a Profits Tax Return on an annual basis even in cases when there is no business activity in Hong Kong and/or no tax payable.

The first Profits Tax Return is usually issued to the company approximately 18 months after incorporation and must be filed with the Hong Kong tax authorities together with the first audited accounts no later than 3 months after issuance. In all subsequent years the Profits Tax Return will be issued on 31 March.

F) Significant Controllers Register 

Every Hong Kong company is required to obtain and maintain up-to-date beneficial ownership information by way of keeping a Significant Controllers Register to enhance transparency of corporate beneficial ownership in order to fulfil Hong Kong’s international obligations under the Companies Amendment Ordinance which has commenced operation on 1 March 2018. The Register has right to request the company opens Significant Controllers Register for inspection by law enforcement officers upon demand.

G) Reporting of remuneration paid to employees 

Every Hong Kong company is required to submit a return to the Hong Kong tax authorities before 30 April each year detailing the remuneration paid to its employees during the year to 31 March. If a company has paid no remuneration it is required to complete the return to advise the Hong Kong tax authority that no remuneration has been paid.

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