Five Reasons You Should Set Up Your Business in Hong Kong | Article – HSBC VisionGo
We previously covered why Singapore should be your next startup destination for APAC expansion. Today, we will be showing you why Hong Kong is also an ideal location for incorporating in the Asia-Pacific region. Its business advantages in terms of physical location, innovative tax structure, and local government support are key benefits. In addition, Hong Kong's access to world-class manufacturing and technology services in the Greater Bay Area are second to none.
Located on the southeast coast of China, Hong Kong is strategically situated with easy access to the Chinese market. People can conveniently travel between the two regions within the same day. Hong Kong is only an hour's drive away from one of the world’s major manufacturing bases - the city of Shenzhen and the factories of the Pearl River Delta. This offers Hong Kong direct access to the 450-million consumer market in Southern China. In addition, Hong Kong’s Closer Economic Partnership Arrangement (CEPA) with China makes the city an important gateway to China and the Greater Bay Area markets.
Attractive Tax System
Hong Kong is famous for its low-tax regime, a key business advantage. With the introduction of a two-tiered tax rate structure, the tax rate for the first $2 million of assessable profits is at a low 8.25% for corporations and 7.5% for unincorporated businesses (mostly partnerships and sole proprietorships). Assessable profits above $2 million are subject to a tax rate of 16.5% for corporations and 15% for unincorporated businesses.
The Hong Kong Government has been implementing various financial incentives and programs to help businesses grow. Government-supported organizations such as Invest HK offer a wide range of free services suitable for any stage of your business. These customized services span business planning and set-up to launch and expansion. There are also various funding schemes available to support start-ups and encourage R&D technology advancement.
The Greater Bay Area Factor
A stepping stone for start-ups and companies on their continued growth, the Greater Bay Area is key to Hong Kong companies wanting to go global. The GBA development region provides entry to a sizeable market of 70 million consumers. It is a base for rapid prototyping and high-end manufacturing, and there is easy access to an expanding pool of shared talent and R&D facilities.
Innovation & Technology Landscape
Hong Kong is known for its innovation and development. Among others, the Hong Kong Science And Technology Parks Corporation (HKSTP) supports new science and technology businesses through its incubation programme. It also enhances collaboration between Hong Kong, Mainland China, and world-renowned universities, reinforcing Hong Kong’s widely recognized R&D capabilities.
With its strategic location, competitive tax system, and government support, Hong Kong is undeniably an attractive location for your next company set-up or expansion. This is further strengthened with its Greater Bay Area advantages, a world-leading innovation and technology landscape, and the benefits of clean governance and a productive workforce.
Given our extensive experience working with startups and technology companies in setting up or expanding their businesses in both Hong Kong and Singapore, Techlinker Asia is here to help you.