THE BUSINESS REGISTRATION ORDINANCE HIGHLIGHT

According Business Registration Ordinance (Chapter 310, Laws of Hong Kong). Every business owner in Hong Kong should ensure compliance with the requirements of the Business Registration Ordinance. Please find the highlight as following:

  1. Section 7(2) requires every business owner to notify the Commissioner of Inland Revenue (Commissioner). If the business owner does not receive the demand notice in writing within ONE MONTH of the expiry of the existing business registration certificate.
  2. Section 8(1) and 8(2) states if occurs any change in the particulars of business as set out in the form of application for registration or cease of business. Then business owner should within ONE MONTH of such change or of the cessation notify the Commissioner in writing thereof.
  3. Section 8(1A) specifies that a local company registered under the Companies Ordinance (Chapter 622, Laws of Hong Kong) commences to carry on business. It must notify the Commissioner if any change in the business particulars within ONE MONTH, the changes including:
    1. Business Name
    1. Description
    1. Nature of Business
    1. Business address, and
    1. Date of the commencement of business
  4. Section 15(1) provide penalties for offences against the Ordinance consisting of a fine $5,000 and imprisonment for 1 year.

For further information, please contact us.

You may want to read: Business Registration Ordinance for Company

UPDATED HONG KONG COVID-19 RULES FROM 21 APRIL 2022

Hong Kong will begin relaxing its “Most Stringent” set of social distancing restrictions on 21st April 2022. Food and Health secretary Sophia Chan announced that the following measures will be in place on 21st April.

  • Restaurants can resume evening dine-in services until 10 p.m. with a maximum of 4 people per table.
  • Banquets with a maximum of 20 people
  • The public gatherings up to 4 people per group.
  • Lift the restriction on private gatherings of more than two households

Premises will Reopen with Limited Capacity

  • Indoor and outdoor sports venues, except beaches and swimming pools
  • Gyms
  • Beauty parlours
  • Massage parlours
  • Performance venues
  • Theme parks
  • Museum and exhibition venues
  • Entertainment venues, including bowling alleys, ice skating rinks
  • Gaming arcades
  • Religious venues
  • Cinemas
  • Public libraries
  • Playgrounds
  • Eating and drinking will be allowed in cinemas if all staff and customers have received three jabs.

Local Tours Arrangement

Local tours can resume with a maximum of 30 people. However, the head-limit can raise to 100, if

  1. The staff had the booster jab;
  2. All the participants have to meet the vaccination pass requirements; and
  3. Both staff and participants have the rapid test negative result on the departure date.

Premises remain closed

  • Bars will remain closed.
  • Beaches, swimming pools, water sports premises, and barbeque pits will remain closed.

For further information, please contact us.

You may want to read: ANTI-EPIDEMIC SOCIAL DISTANCING MEASURES TIGHTENED in HONG KONG

VALUE-ADDED TAX EXEMPTED IN CHINA

The Ministry of Finance and the State Taxation Bureau issued a joint announcement (No. 15 [2022]). China is extending the value‑added tax (VAT) exemption policy for small‑scale taxpayers and small business firms. The exemption has started since April 2021 due to the Covid-19 pandemic, slow down of business activities across within China and cross-boarder businesses. From now to 31st December 2022, 3% of the VAT will be exempted. Furthermore, the small business firms’ taxpayers with quarterly sales of RMB450,000 or less will be exempt from VAT as well.

The measure aimed at supporting small firms and easing their financial burdens amid recent COVID-19 outbreaks.

For further information, please contact us.

You may want to read: China Taxation Vs Hong Kong Taxation for Foreign Investors

ANNUAL RETURN FILING FOR HONG KONG LIMITED COMPANIES

All local companies incorporated in Hong Kong needs to file an annual return. In order to facilitate the completion of NAR1, key particulars of the company are filed. Whereas this happen at the anniversary date of the annual return as registered and kept by the Companies Registry will be provided. The Hong Kong Limited Company Secretary should deliver a properly completed and signed annual return together with the correct annual registration fee within the prescribed time period with the Companies Registry.

Late Delivery Penalty for

In cases of late delivery of annual returns, companies are still required to pay the statutory higher registration fees calculated based on the date of delivery. Even though the late annual returns are delivered within the concession period. 

Within 42 days after the company’s return date inclusive$23
More than 42 days after but within 3 months after the company’s return date$870
More than 3 months after but within 6 months after the company’s return date$1,740
More than 6 months after but within 9 months after the company’s return date$2,610
More than 9 months after the company’s return date$3,480

Failure to File your Annual Return

To summarise, companies which fail to comply with their reporting obligations in delivering annual returns and other statutory returns for registration under the Companies Ordinance. You company may also be subject o default fines or even prosecuted

For further information, please contact us.

You may want to read: COMPANY UPDATES THAT MUST BE REPORTED WITHIN 15 DAYS

2022 TAX RETURN FILING FOR A COMPANY AND AN INDIVIDUAL

Inland Revenue Department (IRD) of Hong Kong has published a schedule for a company and Individual Tax Return Filing for 2022. The bulk issue of Profit Tax Returns and Individual Tax Returns will be sent on 1st April and 1st June respectively. Thus, your green envelop is coming in early April and June as well. Are you ready to complete the filing for 2022-2023 yet?

Schedule of Profit Tax Return Filing

1st & 4th April 2022:

  • Bulk issue of Profit Tax Return from IRD

3rd May 2022:

Deadline for submitting list of new clients for which your firm was appointed as tax representative on or after 1 March 2022 with “N”, “D” & “M” code returns on “Schedule” Basis.

  • Deadline for submitting list of taxpayers (on “Schedule” basis) who have:
    • Ceased to be your clients for 2021/22 final assessment purposes
    • Change their accounting dates

30th June 2022:

  • Extended due date for “N” code returns. If you are using electronic filing system, there a further extension of 2 weeks.

2nd July 2022:

  • Deadline for notifying changes of clients’ details occurring between 3rd May and 30th June 2022 on “Schedule” basis

31st August 2022:

  • Extended due date for “D” code returns. If you are using electronic filing system, there a further extension of 2 weeks.

1st November 2022:

  • Deadline for submitting further extension list for “M” code current year loss cases. Exceptional, requests in individual cases may be lodged on or before 15th November 2022.

15th November 2022

  • Extended due date for “M” code returns. If you are using electronic filing system, there a further extension of 2 weeks.

31st January 2023

  • Final extended due date for “M” code current year loss cases filed electronically or not.

Tax Return – Individuals

1st June 2022

  • Bulk issue of Profit Tax Return from IRD

2nd July 2022

  • Deadline for submitting list of clients whom you have commenced or ceased to represent which the department had not been notified prior to 11th March 2022.
  • Due date for unrepresented cases not involving sole-proprietorship business. If you are using e-tax filing, then you have further 1 month extension.

2nd August 2022

  • Extended due date for represented cases not involving sole-proprietorship busiess.

1st September 2022

  • Due date for unrepresented cases involving sole-proprietorship business. If you are using e-tax filing, then you have further 1 month extension.

1st November 2022

  • Extended due date for represented cases involving sole-proprietorship businesses.

Failure to Submit

In all cases if you cannot lodge a tax return by the due date or the extended due date, estimated assessment will be issued and you may be required to pay more tax. You may also be subject to penalty proceedings which include payment of penalty, or even prosecuted.

For further information, please contact us.

You may want to read: What to do when I receive a Profit Tax Return?

EMPLOYMENT AGENCIES’ ANTI-EPIDEMIC FUND

Subsidy Scheme for Employment Agencies with valid licence

The novel coronavirus epidemic has brought exceptional challenges to Hong Kong. The Hong Kong Government has responded to the needs of the Employment Agencies in an unprecedented manner. Hence, the Labour Department launched the Subsidy Scheme for Employment Agencies under the 6th Round of Anti-epidemic Fund

One-off Lump Sum Subsidy

The scheme aims to assist Employment Agencies to tide over the difficulties arising the COVID-19 epidemic. The scheme will grant a one-off lump sum subsidy to below:

  • $50,000 for each main licence of Employment Agencies that provide a foreign domestic helper placement service;
  • $30,000 for each main licence of Employment Agencies that provide a non-foreign domestic helper placement service; and
  • $10,000 for each duplicate licence for branch office of both kinds of Employment Agencies

Eligibility

An Employment Agency eligible for applying for a subsidy under the Scheme must:

  • have held a valid licence issued by the Labour Department under section 52 of the Employment Ordinance (Cap. 57) as at 31 January 2022.  If the validity period of the current licence of the EA is less than two months on the date of subsidy application, the EA must have submitted an application for licence renewal to the Labour Department in accordance with Regulation 2 of the Employment Agency Regulations (EAR) (Cap. 57A); or
  • have submitted an application for the issue of a new licence in accordance with Regulation 2 of EAR as at 31 December 2021, and the application was still under processing as at 31 January 2022.

If an Employment Agency has applied to the Labour Department for issue of a new licence or renewal of licence according to the above, the subsidy will only be disbursed after the licence application is approved.  For Employment Agencies meeting the requirement in item (i) above and intending to apply for a subsidy of $50,000, they will be required to declare that they had provided foreign domestic helper placement service on or before 31 January 2022, and may be required to submit documentary proof as necessary.  As for Employment Agencies meeting the requirement in item (ii) above, they can only apply for a subsidy of $30,000 as they have only been issued a new licence after 31 January 2022.

When and how to apply?

The scheme is open for application from 17th March – 29th April 2022. You can submit a completed the form and required document, and then send to Employment Agencies Administration of Labour Department. And then you can send via fax, post , email or in person during the application period.

If you submit your personal via fax or email, the Labour Department may ask the applicant concerned to provide the original copy of the documents for verification. However, Labour Department will not consider any late applications, incomplete applications or applications with late submission of the required documents. So, please check if you are submitting along with a completed application form and required documents and BEFORE 29th April 2022.

For further information, please contact us.

You may want to read: THE PROPOSAL OF 6TH ROUND OF ANTI-EPIDEMIC FUND

2022-2023 HONG KONG BUDGET HIGHLIGHTS

Hong Kong’s finance chief on 22th February, 2022 unveiled a costly HK$170 billion ($21.79 billion) budget. Including tax breaks and consumer spending vouchers, as the city reels under its worst coronavirus outbreak to date.

The budget will direct more resources to relieve people’s hardship and provide SMEs with some breathing space so as to stabilize the economy and maintain public confidence. Estimated deficit for 2022-2023 is $56.3 billion. Thus, the budget will continue to adopt an expansionary fiscal policy with initiatives mainly focusing on 4 areas:

  1. supporting an all-out effort to win the fight against the epidemic;
  2. relieving the hardship of our people and SMEs;
  3. rendering support to the struggling economy and fostering post-epidemic economic revival; and
  4. investing for the future by planning ahead for the medium- and long-term development of our economy.

Relieve people’s hardship

  • Issue $10,000 electronic consumption vouchers to each eligible Hong Kong permanent resident and new arrival aged 18 or above.
  • Introduce tax deduction for domestic rental expenses for taxpayers liable to salaries tax and tax under personal assessment. Subject to a deduction ceiling of $100,000 per year of assessment from 2022-2023. The deduction will not apply to a taxpayer who is the owner of the domestic property or an associate of the landlord of the rented property (eg, spouse, parent, child, brother/sister or partner of the taxpayer, or a corporation controlled by the taxpayer) or where the taxpayer receives a rent refund from the employer.
  • Provide an extra half-month allowance of standard Social Security Assistance (CSSA) payments, Old Age Allowance, Old Age Living Allowance or Disability Allowance. Similar arrangements will apply to Working Family Allowance.
  • Extend the 100% Personal Loan Guarantee Scheme for one year until the end of April 2023. And the ceiling will increase from $80,000 to $100,000. The maximum repayment period will extend to ten years.

Support Enterprises

  • Introduce Rental Enforcement Moratorium for tenants of specific sectors through legislation.
  • Further extend the application period of 100% guarantee low-interest loan for enterprises to the end of June 202. And raise loan ceiling to $9 million, extend repayment period and duration of principal moratorium.
  • Extend the waivers/concessions of the existing 34 groups of government fees and charges for 12 months.
  • Continue to grant the 75% rental/fee concession to eligible tenants of government premises/short-term tenancies and waivers for six months (100% concession for those closed at the Government’s request).

Enhance Economic Resilience and Enrich Industrial Development

  • Provide tax concessions for the eligible family investment management entities managed by single-family offices with effect from 2022-2023.
  • Provide half-tax concession to attract more maritime enterprises to establish a presence in Hong Kong.
  • Issue no less than $15 billion of inflation-linked retail bonds, no less than $35 billion of Silver Bond and no less than $10 billion of retail green bonds in the next financial year.
  • Set up a ‘Digital Economy Development Committee’ to accelerate the progress of digital economy.
  • Allow stocks traded via the Southbound Trading of Stock Connect to be denominated in RMB. And roll out supporting measures such as waiving the stamp duty on stock transfers paid by market makers in their transactions to increase the liquidity of RMB-denominated stocks.
  • Continue to proactively expand Hong Kong’s Comprehensive Avoidance of Double Taxation Agreements (CDTAs) network. At present, Hong Kong has signed 45 CDTAs and is in negotiations with 14 tax jurisdictions. With a view to minimising the risk of double taxation borne by foreign enterprises doing business in Hong Kong.

Rates Concession and Rating System

  • Propose to limit future rates concession for domestic properties to one domestic property for each eligible owner who is a natural person starting from 2023-2024.
  • Introduce from 2024-2025 progressive rating system for domestic properties. For domestic properties with annual rateable value of $550,000 or below. It is proposed that rates will continue to be charged at the present level of 5% of the rateable value. For domestic properties with rateable value over $550,000, it is proposed that rates be charged at 5% of the rateable value on the first $550,000 and at 8% of the rateable value on the next $250,000, and then at 12% on rateable value exceeding $800,000.

New International Tax Standards

  • Plan to submit a legislative proposal to the LegCo in the second half of this year to implement the global minimum tax rate and other relevant requirements in accordance with the Organisation for Economic Co-operation and Development (OECD) Base Erosion and Profit Shifting (BEPS) 2.0 framework targeting multinational enterprises (MNEs) with consolidated group revenue exceeding Euro 750 million.
  • Consider introducing a domestic minimum top-up tax with regard to the aforesaid MNEs starting from the year of assessment 2024/25 to ensure that their effective tax rates reach the global minimum effective tax rate of 15 per cent so as to safeguard Hong Kong’s taxing rights.
  • Reaffirm the Government’s stand to preserve the advantages of Hong Kong’s tax regime in terms of its simplicity, certainty and transparency, maintain the territorial source principle of taxation as well as minimise the compliance burden on MNEs when implementing BEPS 2.0.

Still, this is the proposal and subject to final approval from the Legislative Council.

For further information, please contact us.

You may want to read: THE 2021-2022 BUDGET TARGETS ON REVIVING THE ECONOMY

EMPLOYMENT SUPPORT SCHEME (ESS) 2022

Hong Kong Government announced to launch a new tranche of Employment Support Scheme (ESS). Due to the 5th wave of COVID attacked hardly on the economy, the government budgets $26-$31 billion wage subsidy to safeguard local jobs.

What is the objective of ESS?

The Employment Support Scheme aims to speed up the economy recovery and resumption from the 5th Wave of COVID. The experience of the 1st round ESS in 2020, the government focused on supporting the affected industries, small and medium-sized enterprises (SMEs).

The practice of the wage subsidy will be the same as 2020. The wage subsidy will be granted to eligible employers. Then the employers to pay for May, June and July 2022 salary.

What are the criteria of ESS?

  1. $8000 per month per employee with monthly salary less than $30,000.
  2. The employers have to propose the number of subsidised employees. And the ceiling of subsidised employee is less than previous ESS in 2020.
  3. During the ESS period, the number of employee should NO LESS than the number of proposed in the application.

Who is NOT eligible under the ESS?

For the new tranche of ESS, Supermarket and pharmacy chain store, property management, banks, financial institutions, express delivery, telecommunications are excluded.

Still, the new tranche of ESS needs approval from the Legislative Council. And the government will contact chambers of commerce, employer’s federations and trade unions to refine the details of the scheme. The subsidy schedules to payout in April.

For further information, please contact us.

You may want to read: Second Employment Support Scheme for Wage Subsidies

Hong Kong Investment Visa (Entrepreneur Visa) – 3

How to make your Hong Kong Investment Visa application more favourable to the Immigration Officers?

Hong Kong welcomes the overseas entrepreneurs as the act is contributing to the city. Definitely, you will be the more favourable Hong Kong Investment Visa applicant if you are a potential contributor. In fact, the actual potential contribution can be evaluated through a business plan. The statistics of business turnover, financial resources, investment sum, number of jobs created locally for HK residents, and the introduction of new technology or skills.

How to prove your business is benefiting Hong Kong Economy?

You have to submit a two-year business plan stating the nature of the business, market analysis, market positioning, business direction, sales targets, product marketing strategy, etc. In order to demonstrate that the business is suitable for and capable of developing in Hong Kong. Also, you should submit a two-year forecast of the profit-and-loss account statement, cash flow statement and balance sheet to demonstrate the feasibility of the business in terms of operation, finances and development.

Even though Hong Kong doesn’t state the minimum investment amount. You still have to submit documentary proof showing the amount of capital investment, proof of your personal and company bank statement and proof of other sources of funding.

Besides, the financial benefit from the business. The Immigration Officer will take into account if your business can create jobs locally. Thus, you have to indicate the number and level of actual jobs created locally. Furthermore, if you can introduce a new technology or skills to Hong Kong. Definitely, your application will become more favourable.

If your business belongs to or is able to complement industries that Hong Kong usually gets considerable advantages. The industries include the 4-traditional pillar industries. That is, trading and logistics, tourism, financial services, and professional and producer services. The industries may also be the four clusters of sectors for example: transportation, convention and exhibition industries and tourism, manufacturing industries, innovative technology and cultural and creative industries, and professional services.

For further information, please contact us.

You may want to read: What kind of business entrepreneur are you according to commitment?

LOCKDOWN IN DONGGUAN OFFICE 2022

Life is so challenging

Lockdown and Quarantine both words seem the vocabularies from dictionary and never been alive. Since the outbreak of COVID-19 in 2020, many cities have imposed the stringent epidemic control measures: Lockdown means suspend all the activities in a city and people have to stay at their homes. While quarantine mean people have to separate from the local up to 21 days.

What’s happening in Southern China – Dongguan

Dongguan has imposed strict COVID-19 control measures last week. Only in China, there is a term LOCKDOWN ON-SPOT. That is, when the Epidemic Prevention Bureau find out or someone reported there is a confirmed case within the residential estate, town, village, office buildings, shopping malls or even at the gym. They will preform all measures and lock you down on the spot no matter where you are. Somehow, we’ve just experienced lock down in the office.

The Experience

Our Centre O China office teammates just had an office lockdown adventure for 8 days. Happy to announced we are let out, no confirmed case within the office, and we all survived. We would say the good thing is we are still allowed to order food deliveries, receiving Taobao shoppings, or even having families and friends delivering goods and food to us. All we can’t is to leave the town where the office is, or having any goods or documents or any person leaving the area until they releases everyone. Here, we share our extraordinary experience with you, and what to prepare in advance just incase if there’s another lockdown again.

What to prepare?

Here’s a tailor-made quarantine list if you are LOCKDOWN ON-SPOT in the office.

  • Toothbrush & Toothpaste
  • Makeup remover, face wash
  • Makeup set
  • Shower: shower gel, shampoo and towels
  • 2 sets of house wear & underwear
  • Medicine & supplement that you always use
  • Travel pillows, blanket and sleeping bag
  • Hangers
  • A pair of plastic slippers
  • Instant noodles and soup
  • As you will be seeing your colleagues 24hours, you might consider bringing a small set of makeup handy as well.

Last but not the least, keeping some your favourite snacks that will make your LOCKDOWN journey more pleasant.

For further information, please contact us.

You may want to read: ULTIMATE PACKING LIST FOR COVID HOTEL QUARANTINE IN CHINA

https://www.centreo.hk/pack-for-quarantine/