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Sole Proprietorship - non HK resident - who can help me?

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  1. #1

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    Sole Proprietorship - non HK resident - who can help me?

    Hi all,
    I would like to register as Sole Proprietorship in HK. I am not HK resident and I don´t want to live there. I want to do only really small business with internet selling as e-commerce or Ebay. From this reason I think it will be much more easy to register as Sole Proprietorship than Ltd. company..
    I tried to contact couple of agencies which provide asisstance.
    What they wrote, I will need a local agent who will be registered with me as my representant in HK. I want to ask, if it is safe for me? What all can do this person? Sole Proprietorship is unlimited liability, can this person for example make any debts for me? Is it risky?

    I read that accountancy don´t have to be audited for Sole Proprietorship. I found on internet:
    "Small businesses whose gross income does not exceed HKD 500,000 are not required to attach any financial statements along with the tax return" - I think it will be my case... Can anybody recommed for me a accountant with your good experience and reasonable price?

    Must I really necessary to use an agency for registration or can I do it by myself when I will come on turist visa to HK?
    If no, what is average price of asisstance of an agency..I got couple of offers, but the prices are very different..

    Banking account - I heard that for Sole Proprietorship isn´t necessary to have business account, a personal account is allowed..am I right?
    Or how difficult is to open a business account in HK for non-resident? Can you recommended for me a bank in HK? I am looking for a normal HK bank with reasonable price of monthly fees...all offer me HSBC, but it´s quite expensive.. Or if a bank in HK can open account without personal visit, it is the best solution for me...Please share your experience..

    Visa - I heard, that if I will be register as Sole Proprietorship in HK, but if I will live outside..I don´t need investment or working visa...am I right?

    Is it anything risky here what I should know before I will start to set up my plans?

    Please if anybody can provide me more informations, pls write here or PM.

    If anybody can help me, don´t hesitate to contact me..

    Thanks


  2. #2

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    The short answer is yes you can register, but yes you also need an agent with a HK address; you don't actually need to come to HK to register the business, it can be done remotely by mail.

    You can have a personal or business bank account, but this will be much easier to do if you are physically in Hong Kong (and is required for a business account). You don't need to be resident to have a bank account. If you can keep a minimum balance of HK$10,000 in a HSBC personal account then it is free of monthly charges.

    You don't need a visa to register a HK business.

    You will need to maintain business accounts and complete a HK Tax Return every year, but if your revenue does not exceed HK$500,000 then you can simply state the basic figures from your accounts in the tax return; you do not need to get the accounts audited or submit copies of them (but they must exist in case IRD decides to do a tax audit of your business). You can choose either to do the paperwork with the Inland Revenue yourself or you can appoint an agent to do that as well. This could be either the same agent or a different one from the one you choose to do the business registration.

    There's no risk in employing an agent - it is solely for the purposes of business registration (and maybe tax returns). They are not an officer or employee of the business and are not able to make commitments on its behalf. However, since they are providing the registered business address, that is where the original Business Registration Certificate must be kept.

    Degi likes this.

  3. #3

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    Quote Originally Posted by pintus:
    Hi all,
    I would like to register as Sole Proprietorship in HK. I am not HK resident and I don´t want to live there. I want to do only really small business with internet selling as e-commerce or Ebay. From this reason I think it will be much more easy to register as Sole Proprietorship than Ltd. company..
    Why would you want to establish a sole proprietorship in HK if you aren't going to be here? Sounds to me like you are attempting some kind of tax avoidance scam.

    I think you are going to have legal and tax trouble in your home country if you run a business on the internet and pretend that you are actually running it out of Hong Kong.

    I doubt a HK bank will let you open an account without a HK ID card. They don't want to get into trouble for tax scams and with FATCA and other know-your-client legislation on the way, will be reluctant to get involved unless you've got an excellent (real) reason fo registering in HK and not actually being here.

  4. #4

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    Quote Originally Posted by Freetrader:
    I doubt a HK bank will let you open an account without a HK ID card.
    I know from personal experience that even HSBC will quite happily open a personal bank account for anyone who walks in with HK$10,000 to deposit and their passport in hand. They'll even offer you a year of Premier for free (or at least they would a couple of months back).

  5. #5

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    Quote Originally Posted by PDLM:
    I know from personal experience that even HSBC will quite happily open a personal bank account for anyone who walks in with HK$10,000 to deposit and their passport in hand. They'll even offer you a year of Premier for free (or at least they would a couple of months back).
    I stand corrected.

  6. #6

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    Yes - sorry - forgot about the proof of address. A driving licence would do.


  7. #7

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    Hi PDLM
    Do you know anything about requirements pertaining the name of a sole proprietorship ?
    Does it have to be "Morris Morrison Sole Proprietorship" or could it be any name ?
    E.g. Willis Fine Goods Sole Proprietorship ( not even mentioning my name but using a pseudonym)

    From what I understand names for a sole proprietorship require no approval ( unlike for a Ltd. )

    Thanks


  8. #8

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    You can use any names, ABC traders, DEF export & Import, Sports Inc. Tailors r us, use your imagination, or use the name to describe the service you are offering.

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  9. #9

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    Yes - any name you want, except that the name cannot imply that the business is a limited or incorporated business. "Sports Inc" would, I believe not be allowed.

    Bear in mind though that if you are planning to use your personal bank account for the business then some clients may have a problem paying to a bank account name which bears no resemblance to the Registered Business Name on the invoice. If this is likely to be an issue then you can register the Sole Proprietorship with your own name or something based on it (subject to the no "company", "limited" etc).

    Morrison likes this.

  10. #10

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    With a limited company, you can add an additional name on the BR under 'branch name'. If this works for sole proprietorship too, then you can have your own name on the BR and the "company name".

    We added the domain name to the branch field on the BR. Company known to customers as company.com with a very long business name (a b c d limited) that nobody really knows and cares about.

    On the bank accounts the same, not sure if this is due to the branch name or other circumstances: companyname.com o/b by a b c d limited (o/b = operated by). In my experience this makes it easier for customers to pay to company.com without the payment being "lost". Sometimes you just don't have control what they put on the beneficiary name field on bank transfers, even you give them all the details.

    this all was with limited, but I can imagine there are various ways if you ask for it up front and provide all documentation for it.


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