Is Hong Kong an offshore jurisdiction?
The Inland Revenue Department (IRD) taxes profits arising in or derived from Hong Kong. As a general rule, profits earned abroad are not taxed, even if the money lands in a local account. Corporations pay 8.25% on the first HK$2 million of assessable profits and 16.5% on the rest. Where a company has connected entities, only one of them, nominated by the group, can use the two-tiered rate.
Members of multinational enterprise groups fall under the FSIE regime, which comes with economic substance requirements. Since January 1, 2023, foreign-sourced interest, dividends, income from intellectual property and gains on the disposal of equity interests received in Hong Kong have been taxed if the recipient does not meet the exemption conditions. Since January 1, 2024, the regime has also covered gains on the disposal of any property.
The source of profits is a question of fact: where contracts were concluded, where the work was done and who made the decisions. That is why we prepare the offshore-source position together with the transaction documents. As of October 9, 2026, Hong Kong is not on the EU list of non-cooperative jurisdictions.
Key facts about a Hong Kong offshore company
| Item | How it works in Hong Kong |
|---|---|
| Legal form | Private company limited by shares under the Companies Ordinance (Cap. 622) |
| Director | At least one, an individual, who may live in any country |
| Secretary and address | A Hong Kong resident or a local body corporate as company secretary; a registered office in Hong Kong |
| Incorporation fee | HK$1,545 for electronic filing |
| Business registration for 2026/27 | HK$2,350 for one year or HK$6,170 for three years |
| Annual return | NAR1 within 42 days after the anniversary of incorporation, HK$105 |
| Profits Tax | 8.25% on the first HK$2 million and 16.5% above that, on Hong Kong-sourced profits only |
| Audit | Every year, except for dormant companies |
| Tax treaties | More than 50 double taxation agreements |
| EU list | Not on the list of non-cooperative jurisdictions (October 9, 2026) |
Who a Hong Kong offshore company suits
- Trade with suppliers in China and elsewhere in Asia.
- Intermediation in international B2B deals.
- IT and services for clients in Asia.
- A regional holding company for Asian subsidiaries.
For a business with no link to Asia, this structure often costs more to maintain and draws more questions from the bank. In that case we compare it with the BVI for a holding company and with the UK for services in Europe. The Hong Kong and Singapore pairing is covered in our jurisdiction comparison, and Singapore’s terms are on the offshore company in Singapore page.
Legal form and Companies Registry requirements
The usual form is a private company limited by shares. The Companies Registry requires:
- at least one director who is an individual; the director does not have to live in Hong Kong;
- a company secretary: an individual ordinarily resident in Hong Kong or a body corporate with a local office; a sole director cannot also act as secretary;
- a registered office in Hong Kong;
- a Significant Controllers Register, kept in Hong Kong and open on demand to law enforcement officers, including the Companies Registry and the IRD.
Incorporation requires Form NNC1, the Articles of Association and a notice to the Business Registration Office (IRBR1). The incorporation application also counts as the application for business registration.
How much a Hong Kong offshore company costs: government fees
| Companies Registry fee | Amount |
|---|---|
| Incorporation of a private company having a share capital, electronic filing | HK$1,545 |
| Same, paper filing | HK$1,720 |
| Annual return NAR1 filed within 42 days | HK$105 |
| Late NAR1 | from HK$870 to HK$3,480 depending on the delay |
The business registration fee and levy are paid separately. The full cost of a Hong Kong offshore company also covers the company secretary, the address, bookkeeping and tax reporting, and we work it out for your case. How to build a two-year budget is shown in our guide how much an offshore company costs.
Business registration: the fee for 2026/27
The Business Registration Certificate is issued by the Business Registration Office of the IRD. When a company is incorporated through the Companies Registry, the certificate comes in the same package: it runs from the date of incorporation, and the amount depends on the date the documents are filed. For certificates commencing between April 1, 2026 and March 31, 2027, the IRD table is as follows: a one-year certificate costs a fee of HK$2,200 plus a levy of HK$150, HK$2,350 in total; a three-year certificate costs HK$5,720 plus HK$450, HK$6,170 in total.
The three-year option is chosen in the incorporation application, and an existing company elects it by written notice at least one month before its current certificate expires. If the business closes before the three years are up, the fee and levy stay with the IRD. Amounts for earlier periods were different, so when buying a shelf company we check which years the certificate has been paid for.
Documents and KYC
The company secretarial firm and the bank check every director, shareholder and beneficial owner. We prepare in advance:
- passports and proof of address;
- an ownership chart up to the individuals;
- a description of the goods or services, suppliers and buyers;
- contracts and invoices, or drafts of them;
- evidence of the source of the starting capital.
Annual obligations and reporting
Every year a private company files an NAR1 return with the Companies Registry within 42 days after the anniversary of its incorporation. NAR1 is a corporate return covering the directors, company secretary, address and shareholders. Tax reporting to the IRD is prepared separately, with its own requirements and deadlines. We draw up a compliance calendar in the first month after incorporation.
Audit and the Profits Tax return
The financial statements of a Hong Kong company are audited. In its guidance on the Companies Ordinance, the Companies Registry states that an audit is required for all companies, including those using simplified reporting; the exception is dormant companies under section 447. We therefore include the audit in the budget for every year of operation; how the accounts are prepared is described in our guide to offshore company accounting and audit.
The IRD has announced new requirements for Profits Tax returns: if there was any gross income in the period, the return is filed with all supporting documents, including the financial statements and the tax computation. Small businesses with gross income of up to HK$2 million can no longer file the return without these documents. An offshore-source claim is supported by contracts, invoices and a description of where the deals were concluded and who handled them.
A Hong Kong offshore company with a bank account
The bank assesses the applicant separately from incorporation. A trading company is asked about its contracts with the factory and the buyer, the route of goods and payments, volumes and currencies. If you need a Hong Kong offshore company with a bank account, we discuss the bank before incorporation and prepare the package under our bank account for an offshore company service. A company incorporated in advance can be chosen from our shelf offshore companies.
For a trader, the bank checks the whole supply chain. Take a company that buys spare parts from a factory in Guangdong and sells them to a Canadian distributor. The bank will want to know who buys the goods from the factory, who owns them at each stage, which Incoterms govern delivery, who pays for freight and customs, and why the buyer pays the Hong Kong entity in particular. We put this package together before the bank application. How to set up a trader’s contracts and payment route is shown in our guide to the international trading company.
The owner’s taxes and CFC rules
The territorial principle governs the taxes of the Hong Kong company itself. The owner’s country of residence may tax its profits under CFC rules or when dividends are paid. General approaches to CFC rules are set out in the OECD BEPS Action 3 report; a tax advisor checks how they apply to your situation, and we give the advisor the full structure chart.
Hong Kong double taxation agreements
Hong Kong has more than 50 comprehensive double taxation agreements (CDTAs). The IRD list includes mainland China, the United Kingdom, Canada, the UAE, Russia, Georgia, Estonia, Latvia, the Netherlands, Switzerland, Japan and Vietnam; some of the agreements have been modified by the multilateral MLI convention. Ukraine, Kazakhstan and the United States are not on the list.
A treaty reduces withholding tax, for example on dividends or royalties from the partner country, only if the Hong Kong company proves its residence. The IRD issues a Certificate of Resident Status on application, and this is where the company’s place of management becomes a practical question. How tax authorities assess it is covered in our guide to company tax residency.
Moving a company from the BVI or the Cayman Islands to Hong Kong
Since May 23, 2025, a re-domiciliation regime has been in place under the Companies (Amendment) (No. 2) Ordinance 2025. A company incorporated outside Hong Kong can transfer its registration there and keep its legal personality and business continuity. From the date of transfer it is treated as a Hong Kong company and must meet all the requirements of the Companies Ordinance (Cap. 622). This route is used, for example, when a holding company in the BVI moves the management of the group to Asia.
The application is filed with the Companies Registry together with the business registration documents, and the certificate of re-domiciliation is issued at the same time as the Business Registration Certificate. If the law of the place of incorporation and the constitution do not require members’ consent, the application must include a members’ resolution passed by a majority of at least 75%. A director confirms that the company is not in liquidation or insolvency proceedings, that creditors have been notified and that contractual consents have been obtained. Within 120 days after the certificate is issued, the company gives the Registrar proof of its deregistration in the former jurisdiction.
Two-year budget for a Hong Kong offshore company
We split the estimate into the first and second year. It covers the Companies Registry fee, the business registration fee, the company secretary and registered office, NAR1, bookkeeping, audit, the Profits Tax return and bank preparation. For a trading business the bookkeeping workload depends on the number of payments, currencies, invoices and warehouse movements, so we calculate it for your model. Describe in your request the goods or services, the supplier’s country, the buyers and the expected turnover.
Pros and cons of a Hong Kong structure
| Pros | Cons |
|---|---|
| Tax only on Hong Kong-sourced profits | A local company secretary and office are mandatory |
| 8.25% rate on the first HK$2 million of profits | Annual NAR1 and separate tax reporting |
| The director can live in any country | FSIE regime for members of multinational groups |
| Well suited to trade with China and Asia | The bank asks for proof of real business activity |
Incorporation timelines depend on the registry’s name check, KYC by the company secretary and document preparation. We give an exact schedule after reviewing your case.
Frequently asked questions
Is Hong Kong an offshore jurisdiction?
It is a low-tax jurisdiction with a territorial system: Profits Tax is charged only on Hong Kong-sourced profits, at 8.25% on the first HK$2 million and 16.5% above that. People call it offshore out of habit, although a local company has a company secretary, an annual NAR1 return and tax obligations. The FSIE regime applies to members of multinational groups.
How much does a Hong Kong offshore company cost?
The Companies Registry fee for incorporating a private company is HK$1,545 for electronic filing and HK$1,720 on paper; the business registration fee is paid separately. An annual NAR1 filed on time costs HK$105. We price the company secretary, address and bookkeeping services for your case.
Can I buy a Hong Kong offshore company with a bank account?
The bank opens the account after its own check of the owners and the business model, so incorporating or buying a company does not guarantee one. We test your model against the chosen bank in advance and prepare the documents.
Do I need to file NAR1 if the company has not been trading?
The Companies Registry requires a private company to file an annual NAR1 return every year within 42 days after the anniversary of its incorporation. We check any special regime for inactive companies against the status of each one.
Does the director have to live in Hong Kong?
The director can live in any country. The company secretary, if an individual, must be a local resident, and the registered office must also be in Hong Kong.
How much does business registration cost in Hong Kong?
For certificates commencing between April 1, 2026 and March 31, 2027: HK$2,350 for one year (a fee of HK$2,200 plus a levy of HK$150) or HK$6,170 for three years. For a new company the amount depends on the date the incorporation documents are filed.
Which countries does Hong Kong have tax treaties with?
Hong Kong has more than 50 double taxation agreements, including with mainland China, the United Kingdom, Canada, the UAE, Russia, Georgia and Estonia. Ukraine, Kazakhstan and the United States are not on the IRD list.
Can a company be moved from the BVI to Hong Kong?
Yes. Since May 23, 2025, a foreign company can re-domicile to Hong Kong and keep its legal personality. Once the certificate is issued, it has 120 days to prove its deregistration in the former jurisdiction.
Tell us about your task, and we will propose a structure, the scope of services and the order of work.
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