Important Tips for Forming a company in Hong Kong and China
You can register your business as a limited company through company formation. Limited companies that have their rights, responsibilities, and liabilities are viewed as individuals by the law. There is a separation between incorporated business and their owners regarding finances, assets and liabilities. When forming a limited company, business owners aim to lower their financial responsibilities. Business people in Hong Kong and China acquire many benefits. Many foreigners are attracted by this, and they go to these places to try out their luck. In this article, the things that you need to know before you form a company in China are highlighted.
It is important to decide on the type of company you intend to start. Once you decide to set up a business in Hong Kong you are assured of a variety of options. WFOE and Hong Kong companies can only be used by business located in the mainland. The advantages and disadvantages you will face will depend on the type of business you engage in. As a result, prospective business owners need to weigh their options before making their decisions.
It is important to make sure that your business is in the right location. Just like every other country, China has places that are known to be good business locations. It is good to look for a city whose advantages and disadvantages you can handle. You should only start your company once you are aware of the treatment the local government is likely to give your business. Despite the mainland, you can decide to set up your business in Hong Kong. In comparison to the mainland, company formation in China is easier.
You are required to look at the tax rates of the cities where you are thinking of starting a business. Taxation varies depending on the type of company you have decided to register. It is advisable to be well aware of the tax rates of different cities. Business people often consider setting up their business in China due to the low individual and corporate taxes. Every business person is required to have a corporate bank account. You have to decide between setting up an account in a local or international bank.
It is important to respect the laws of the country. You should never be swayed to set up illegal business just because you are in a foreign country. At times it is hard to tell the corporate legal laws in China since they are first published in Chinese. It may be advantageous to consult a local expert or lawyer when starting up a business in this country.