Starting a business overseas is an exciting venture. It opens you up to new markets and opportunities, and you could benefit financially as a result. However, there is one tricky decision that needs to be made: deciding on the right country for your business.
Ultimately, there are pros and cons to every available country. Each will have different regulations for foreign-owned businesses, and these could put the roadblocks up to any prior ideas you had. Then there are many other different aspects to ponder, including a specific country’s economic state, tax rates, prospects, and so on.
When making the decision, it’s wise to look at where others are starting up their companies. In that regard, Hong Kong has turned into a startup hotspot. Yet why is this the case, and should you choose Hong Kong as the base for your business?
Assistance is available
Even though the government has made it relatively easy to start a business in Hong Kong, it is still a massive undertaking that can be daunting to process. Thankfully, assistance is available. For example, INS Global is an overseas expansion expert that can help you setup a company in Hong Kong.
By using an outlet such as INS Global, you can receive help with opening a bank account in Hong Kong. Perhaps more importantly, they can deal with the employee side of your business. They can hire and fire staff members, sort out monthly payroll – including Hong Kong’s Mandatory Provident Fund (MPF) – and deal with employer returns.
Economic freedom
Hong Kong has built a strong reputation for supplying economic freedom to businesses. Sitting just behind Singapore, Hong Kong is the country that supplies the world’s second freest economy.
What does this mean exactly? Well, it ensures that markets are open to global commerce, there is the freedom to trade, the legal environment is transparent, efficient regulatory administration, and more. The result: a platform that gives every business the chance to prosper.
Welcoming to foreign businesses
Certain countries will put up extensive restrictions and requirements before they allow a foreign business to operate – and even then, the business could still be limited in what it can do compared to local outlets.
This is not the case in Hong Kong. In fact, they are incredibly supportive of foreigners starting businesses in their country. Foreigners are free to be the sole owner of their companies. Via their InvestHK platform, the government also supplies support such as free investment promotions, loan guarantees, and startup marketing funds.
Favorable tax situation
The tax system employed by Hong Kong is particularly advantageous for businesses. As a starting point, corporate tax is currently at a low 16.5%. While it might not be the lowest rate you will find on the planet, there are other benefits to Hong Kong’s tax regime.
For instance, you’re only liable to pay taxes on any business activities that are carried out in Hong Kong. This means foreign-made profits are free from taxation. Also, other taxes like dividend tax, property tax, capital gains tax, and VAT are not imposed.