In order to understand business operations, the management will be the preparation of accounts in order to understand the financial situation of the company, as an indicator of business investment decisions.
Where incorporated in Hong Kong with limited accounts established by its management, are subject to the Companies Ordinance (Chapter 32) to appoint an independent auditor audit the annual accounts for each company to shareholders in the annual AGM perusal. In addition, the Department will require the Company to submit a tax return, attach audited financial statements in order to carry out the assessment process.
When do we need to pay tax, and how do we fulfill our tax obligation?
A Hong Kong limited company will receive its first Profits Tax Return from the Inland Revenue Department (“IRD”) in around the eighteenth month from its incorporation.
However, you are encouraged to have your company’s accounting records prepared and finalized much earlier than the Profits Tax Return is to be issued because you should allow some time to have the accounts audited by a practising accounting firm. Hong Kong companies are required to submit audited accounts with their Profits Tax Returns. The IRD will usually issue a tax demand note a few weeks upon receipt of the Profits Tax Return.
To ease your compliance burden, we will act as your tax representatives free of charge for the first year and, if you are satisfied with our services, we will charge a small fee from the second year onwards.