A Hong Kong company is inexpensive to run, but it is not maintenance-free. Four recurring obligations — the Annual Return, the business registration renewal, the audit, and the profits tax return — run on their own clocks, and each has a fixed penalty for being late. This is the year in one place, with the deadlines that actually matter.
1. Annual Return (Form NAR1) — Companies Registry
Every private company must file an Annual Return with the Companies Registry within 42 days of the anniversary of its incorporation. The 42 days include weekends and public holidays, and the Registry does not grant extensions.
The return itself is a snapshot of the company — registered office, directors, company secretary, share capital and shareholders. Filing on time costs a nominal registration fee. Filing late is where it becomes expensive, and the fee escalates by how late you are:
- more than 42 days but within 3 months of the anniversary: HK$870
- more than 3 months but within 6 months: HK$1,740
- more than 6 months but within 9 months: HK$2,610
- more than 9 months: HK$3,480
Beyond the fee, a persistent default is a prosecutable offence for the company and its officers, with fines of up to HK$50,000 and a daily default fine. Most companies that get into trouble here simply lost track of their anniversary date.
2. Business Registration Certificate — Inland Revenue Department
Separately from the Companies Registry, every business must hold a valid Business Registration Certificate from the IRD and renew it before it expires — annually, or every three years if you opted for a three-year certificate. The IRD issues a renewal demand ahead of expiry; the fee and levy are set by the government and adjusted from time to time. Operating with an expired certificate is an offence, and banks will ask for the current one.
3. Audited financial statements
Hong Kong requires the annual accounts of every company to be audited by a Hong Kong Certified Public Accountant, whatever the company’s size, unless it has been formally declared dormant. The audited financial statements are laid before the shareholders and form the basis of the profits tax computation, so the audit has to be completed before the tax return can be properly filed.
The practical consequence: the accounting records must be in order throughout the year. A company that arrives at year-end with a box of receipts and no bookkeeping will find the audit slow, expensive and, sometimes, qualified.
4. Profits Tax Return — Inland Revenue Department
The IRD issues a company’s first Profits Tax Return about 18 months after incorporation. It then generally arrives every year in early April. Once issued, the return is normally due within about three months, though companies represented by a tax agent can usually take advantage of the IRD’s block extension scheme, which pushes the deadline out according to the company’s financial year-end.
The return is filed together with the audited financial statements and a tax computation. Hong Kong taxes profits on a territorial basis, and the two-tier rate applies: 8.25% on the first HK$2 million of assessable profits and 16.5% on the remainder (one entity per group may claim the lower tier). Late filing attracts penalties and, more damagingly, estimated assessments that must then be objected to.
Alongside the big four
- Employer’s Return — if the company pays staff or directors, the IRD issues an annual Employer’s Return (BIR56A and IR56B forms) each April, normally due within one month.
- Significant Controllers Register — must be kept current at the registered office at all times, not just at year-end.
- Change notifications — changes of director, secretary, registered office or share capital must be reported to the Registry within their own statutory deadlines, typically 15 days.
- Registered office and company secretary — both must be maintained in Hong Kong without interruption; a lapse in either puts every other filing at risk.
The year at a glance
Take a company incorporated on 10 September. Its Annual Return is due each year by 22 October. Its Business Registration Certificate renews each September. Its first Profits Tax Return arrives around March of the second year after incorporation, and annually each April thereafter, with the audit completed in advance. Its Employer’s Return arrives every April. Four clocks, four regulators’ forms — and none of them wait.
Almost every compliance failure we are asked to fix comes from one cause: nobody owned the calendar.
Where NGL comes in
As company secretary and registered office we hold the calendar for every company we look after: we file the Annual Return on time, renew the business registration, keep the SCR current, coordinate the audit with the accounts we maintain, and file the profits tax return with the appropriate extension in place. The owner sees one reminder and one invoice a year, not four regulators’ letters.
This article is general information on Hong Kong compliance requirements at the time of writing. Fees, deadlines and rates are set by the Companies Registry and Inland Revenue Department and change over time; we’ll confirm the current position for your company.