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  • 1 Post By MandM!
  • 1 Post By shri

Freelancer/Contractor requirements

  1. #1

    Join Date
    May 2008
    Location
    New Territories
    Posts
    310

    Freelancer/Contractor requirements

    Hi,

    I want to offer basic IT services for freelance / contractor.

    Can companies pay me as such and I can just consider it personal income?
    Or do I have to get (at minimum) sole prop and BR# for them to pay me legally, and then file taxes separately (at much higher rate of 15%!)?

    Oh, and do I need to setup a separate bank account for this, or can I just use personal account?

    BTW I'm a permanent resident, so no visa issue.

    Thanks

    Last edited by AsiaJason; 11-02-2019 at 12:07 PM.

  2. #2

    Join Date
    Dec 2002
    Location
    薄扶林
    Posts
    23,530

    Might want to look at a Sole Prop. Technically you do need to register if you're running a business. Unfortunately the whole BR cost can be a large "tax" on a small biz.

    Start here for a simple explainer on the differences...

    CLIC - Business and Commerce - Setting up a small or medium-sized business in Hong Kong - Types of business organisation – sole proprietorships, partnerships and limited companies - What are the characteristics of sole proprietorships, partnerships a

    You might want to look at the Personal Assessment FAQ:

    https://www.gov.hk/en/residents/taxe...assessment.htm

    Have a GeoExpat related problem - please create a support ticket.

  3. #3

    Join Date
    Feb 2011
    Location
    Hong Kong
    Posts
    4,965

    Yes technically you need to get a BR, and that can be via Sole Prop or you can open a limited company. Then you need to open a company bank account. I am not sure how that works with Sole Prop but I don't think you can use your personal bank account to receive funds related to your commercial activities. If the check amounts are small and not regular then you could get away with it initially, but eventually, you'll meet a customer who requires a BR or will only make payment to a company named bank account. Until then, see what customers you can get, then you can decide if it's worth the cost of getting a BR and the time involved to open a company bank account.

    With a limited company, you also have annual audit expenses.

    AsiaJason likes this.

  4. #4

    Join Date
    May 2008
    Location
    New Territories
    Posts
    310

    Ah I see - thanks Shri!


  5. #5

    Join Date
    Dec 2002
    Location
    薄扶林
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    23,530
    Quote Originally Posted by MandM!
    I am not sure how that works with Sole Prop but I don't think you can use your personal bank account to receive funds related to your commercial activities.
    You should not use use a single account. I cannot find the terms and conditions, but banks can suspend if they suspect that a personal account is being used for business transactions. Been known to happen.

    - bank terms / conditions will in most cases not allow you to mingle personal and business transactions in a single account.
    - if there is a problem and your one and only account gets suspended, your problems will multiply.
    - ideally with a different bank
    @AsiaJason - Follow this thread and posts by @Cminds and related responses.

    https://geoexpat.com/forum/135/thread343150-12.html

    and

    https://geoexpat.com/forum/135/thread345650.html


    https://geoexpat.com/forum/135/thread345650.html
    MandM! likes this.
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  6. #6

    Join Date
    Sep 2017
    Posts
    20

    Hi Jason,

    I was in a similar situation 3 years ago and did some research. Found out that I needed to get a BR for my one-man/woman band (sole proprietorship) and applied for one. I was also advised to open a company bank account using the BR in order to get payments from my customers/clients.

    Getting the BR was a walk in the park (I'm also a PR), but opening a company bank account was a freaking nightmare. All the "big guns" (HSBC, Standard Chartered, etc.) weren't interested in my "start-up" business with minimal capital and only a home office, and I'd need to jump through a million hoops in order to be "considered" as a potential SME customer.

    I ended up opening an account at the Bank of East Asia. It ain't easy but I got it done in the end with the help of their main branch staff (my Cantonese's crap so thank Goodness the manager who handled my application spoke good English).

    PM me if you want more info. I can dig up the BEA manager's business card and give you his contact info.

    Good luck.

    RT