Tax Hongkong

Offshore Profits (Hong Kong Territorial Tax Regime)

Hong Kong only taxes Hong Kong-sourced profits. Income earned outside Hong Kong may be non-taxable if you can demonstrate genuine offshore activities. IRD reviews overall substance and documentation.

Common offshore indicators:

Key operations, negotiations, and contracts executed outside HK

Goods not routed through HK (for traders)

Customers/suppliers mainly overseas

Decision-making and staff located outside HK

HK banking used mainly for settlement with clear audit trails

Note: New foreign-sourced income rules may affect passive income (dividends, interest, IP) for MNEs—seek specific advice.

Why Choose Us

Efficient. Compliant. Offshore Done Right

Consult-first & risk-aware

we map your business flows before proposing structure or claims.

Audit + tax, integrated

fewer back-and-forths, tighter timelines, cleaner IRD responses.

Offshore claim playbook

evidence matrix, substance alignment, and IRD-ready files.

Bank-friendly reporting

statements designed for ongoing KYC and account maintenance.

What We Do (End-to-End)

Bookkeeping & monthly/quarterly closes (bank reconciliations, AR/AP, expense controls)

Year-end financial statements under HKFRS/HKFRS for PE

Audit coordination with HK CPA firms (PBC list, audit fieldwork, management letter)

Profits Tax Return (PTR) preparation & filing (with tax computation, schedules)

Provisional tax review, objections/holdovers, IRD correspondence

Employer filings / basic payroll (on request)

Offshore profits claim scoping, documentation roadmap & submission pack

Banking/KYC support (audited sets, management accounts, explanations of flows)

Hong Kong Accounting, Audit & Tax Filing — Timeline

Common year-end: 31 March / 31 December (or another date set at incorporation).

Preparation (Month 1)

Gather full-year finance documents

Bank/cash reconciliation

Review & classify transactions

Build bookkeeping-audit-tax work plan

Bookkeeping & Draft FS (Months 2–4)

Post all transactions
Bank/AR/AP reconciliations
Accruals, cut-off, depreciation
Trial balance → draft HKFRS financials

Audit (Months 4–5)

Engage CPA firm
Provide PBC list & supports
Clear audit queries
Receive signed audit report

Tax Filing (Month 6–7)

Prepare PTR + tax computation
Confirm tax payable/offshore position
File PTR & audited FS; respond to IRD
Arrange provisional tax if required

Documents Checklist (Essentials)

Company

CI, BR, Articles

Registers (directors/shareholders)

NAR1 (Annual Return)

Banking & Treasury

Full-year bank / credit card statements

Loan agreements & repayment records

Remittance / TT records

income & expenses

Sales & Supplier Contracts

Invoices & Payment Records

Receipts & Bank Evidence

Payroll & Staff-Related Payments 

Assets & Liabilities

Fixed-asset register & invoices

Depreciation info

Loan/borrowing agreements

Lease contracts & payments

Operations

Customer & supplier lists

Key commercial contracts

Staff list; inventory records (if any)

Board minutes / resolutions

Tax

Prior audit report & PTR

IRD letters / assessments

Provisional tax records

Offshore claim documents (if applicable)

Which Market Base Works Best for Your Strategy?

Choose Hong Kong if you

Run international/cross-border trade with operations largely outside HK Value a simple, stable, low-tax regime and free capital movement Need banking access and a clean holding/trading platform

Choose Mainland China if you

Earn most revenue in China or rely on local supply chains
Qualify for industry/region incentives (e.g., High-Tech, FTZ)
Target onshore consumers and may pursue a China listing

Combination Strategy (common)

Hong Kong company as regional HQ/holdco/trade platform
Mainland entity for manufacturing, sales and operations
Coordinate to optimize overall tax, manage TP/withholding, and ensure compliance on both sides

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