Closing down an HK company

[Torxcrew]

Hello all,

I've had a HK .co,ltd. company open for about 2 years and active for one. Last year the profit was near to zero, and I decided to close it.

The company who helped me with the formation wants nearly $2000 USD for the operation, and I should extend it one extra year (registration $875 is due in July or so) and it seems to me an enormous expense.

Which options do I really have? Paying this fee or even half of it is out of the question.

I am the sole director and employee and I am not resident.

Thanks!

 

[uplana]

I have yet to see any problems if you leave the company alone and just forget about it.

So far the only thing that happen is the company get dissolved / liquidated and no one is contacting you at all.

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[Torxcrew]

uplana said:
I have yet to see any problems if you leave the company alone and just forget about it.

So far the only thing that happen is the company get dissolved / liquidated and no one is contacting you at all.
Click to expand...

Thank you.

There's a pending tax report. Should I submit it (they are asking for $200 USD for it) or just leave it all as it is?
I am not making any business with the company at all at the moment.

And also, if I just let it get liquidated, will I be prevented from opening another company in HK in the future?

Many thanks

 

[uplana]

Torxcrew said:
And also, if I just let it get liquidated, will I be prevented from opening another company in HK in the future?
Click to expand...

I would do nothing and just leave it. They will have to close the company sooner or later. I'm not aware of if they in HK have anything that prohibit people to open companies and leave them without to harm anyone. In most other countries in this world you can do that without any consequences.

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[NicolasMaduro]

Yes in most countries you can simply resign as director and the company will be dissolved.

 

[Mark Rucken]

Torxcrew said:
Hello all,

I've had a HK .co,ltd. company open for about 2 years and active for one. Last year the profit was near to zero, and I decided to close it.

The company who helped me with the formation wants nearly $2000 USD for the operation, and I should extend it one extra year (registration $875 is due in July or so) and it seems to me an enormous expense.

Which options do I really have? Paying this fee or even half of it is out of the question.

I am the sole director and employee and I am not resident.

Thanks!
Click to expand...

I had a similar case. It is expensive to close HK entity. You need to file reports and to be in good standing, so what your Agent is asking is legit.

If you just leave the company, they will send numerous notices and eventually IRD will start sending warning letter to company's registered address. In the end I even received a letter to my home address in my country of resience (this address is listed on company documents). That letter informed me of court invitation which was scary.

I did nothing and they stopped spamming me, however, I do not feel like traveling to HK anytime soon.

 

[Mark Rucken]

uplana said:
I would do nothing and just leave it. They will have to close the company sooner or later. I'm not aware of if they in HK have anything that prohibit people to open companies and leave them without to harm anyone. In most other countries in this world you can do that without any consequences.
Click to expand...

Companies that have accounting and have to file reports with Tax offices are a bit different that typical offshore companies or US disregarded LLCs.

 

[PaulKruger]

Mark Rucken said:
Companies that have accounting and have to file reports with Tax offices are a bit different that typical offshore companies or US disregarded LLCs.
Click to expand...

I would give a flying f**k. If I were to be in the EU and didn't need my HK company any longer I would just leave it alone and don't pay a single $ to get rid of it.

Have done that with
Seychelles
Belize
Cyprus
BVI
Netherlands
Iceland
UK
USA

never had a single issue after or during the period they pushed me to pay money to get rid of the company.

my 2cents cig-:,

 

[daxbr]

HK Ltd is a valuable asset. I'd rather sell it ... here.

 

[kkein]

Exactly. Do i understand it correctly that a HK Ltd. allows to pay 0 corporate tax on basically worldwide (minus HK) income?
If so, it looks like the company everybody with legit biz wants?

 

[fbsworld]

kkein said:
Exactly. Do i understand it correctly that a HK Ltd. allows to pay 0 corporate tax on basically worldwide (minus HK) income?
If so, it looks like the company everybody with legit biz wants?
Click to expand...

Nowadays, economic substance is the most important. In HK, if you have substance there, you will have to pay profits tax, see https://www.ird.gov.hk/eng/paf/bus_pft_tsp.htm