Common Mistakes to Avoid When Registering a Private Company in Hong Kong

Starting a company in Hong Kong can be an exciting venture. As one of Asia’s leading financial hubs, Hong Kong offers entrepreneurs a pro-business environment, simple tax system, and international credibility. However, many foreign and local business owners face delays or complications during the incorporation process due to avoidable mistakes. Below, we outline the most common errors and how you can steer clear of them.

Mistake 1: Choosing a Non-Compliant Company Name

Your company name must comply with the Companies Registry’s guidelines. Names that are identical or too similar to existing companies, misleading, offensive, or that suggest government affiliation will be rejected.

Tip: Conduct a name search using the Companies Registry’s online platform before submission (Official Reference – HK Companies Registry).

Mistake 2: Incomplete or Incorrect Incorporation Documents

The statutory documents for incorporating a private limited company include:

• Incorporation Form (Form NNC1 for a company limited by shares)

• Company’s Articles of Association

• Notice to the Business Registration Office (IRBR1)

Some mistakenly believe they must provide “address proof” at this stage. In fact, the Companies Registry requires only the registered office address listed on Form NNC1 — not proof. However, banks and licensed corporate service providers will require documents such as utility bills or tenancy agreements as part of their KYC process.

Tip: Double-check that all information (directors, shareholders, registered office address) is accurate before filing.

Mistake 3: Misunderstanding the Business Registration Process

Many entrepreneurs think obtaining a Business Registration Certificate (BRC) from the Inland Revenue Department (IRD) is a separate step. In fact, Hong Kong has a one-stop incorporation service: when you file your incorporation documents (NNC1 + Articles + IRBR1) with the Companies Registry, your Business Registration Certificate is issued automatically by the IRD.

Tip: Always use the official one-stop filing system to save time (Official Reference – Inland Revenue Department).

Mistake 4: Overlooking the Role of the Company Secretary

Every Hong Kong company must appoint a Company Secretary. If the secretary is an individual, they must be an ordinary resident in Hong Kong. If it is a body corporate, it must have its registered office or place of business in Hong Kong. Importantly, a sole director cannot also act as the company secretary.

Tip: Many businesses appoint a licensed corporate service provider to ensure compliance.

Mistake 5: Neglecting Tax and Accounting Obligations

Some assume that incorporation is the only compliance requirement. In reality, every company must:

• File an Annual Return (Form NAR1) with the Companies Registry

• Maintain proper accounting records

• File annual Profits Tax Returns with the IRD, including audited financial statements (except for certain exemptions)

Hong Kong applies a two-tier profits tax system:

• 8.25% on the first HK$2 million of assessable profits

• 16.5% on profits above HK$2 million

Tip: Engage a professional accountant to ensure timely filings. Official details about profits tax computation, exemptions and filing procedures are available on the IRD’s website: Profits Tax (Business) ‒ IRD.

Mistake 6: Ignoring Employment and MPF Obligations

If you plan to hire employees in Hong Kong, you must comply with:

• Employment Ordinance (contracts, wages, leave, termination)

• Mandatory Provident Fund (MPF) System: Employers are legally required to enrol qualifying employees, and make the required contributions under the law

Tip: Read the updated legal obligations for employers under the MPF system on GovHK: Employers’ Obligations under the MPF System ‒ GovHK.

Mistake 7: Failing to Protect Intellectual Property

Many overlook trademark registration when starting a company. Registering your company name with the Companies Registry does not protect it as a trademark. To safeguard your brand, file a separate trade mark application with the Intellectual Property Department (IPD).

Tip: Apply early to prevent brand disputes (Official Reference – IPD Trade Marks).

Mistake 8: Assuming Company Incorporation Guarantees Bank Account Approval

Even after incorporation, opening a corporate bank account is subject to the bank’s KYC and due diligence checks. Directors and beneficial owners will be asked for passports, address proofs, and business plans. Approval is not guaranteed, and the process may take weeks.

Tip: Prepare a clear business plan, financial forecast, and supporting documents to strengthen your application.

Mistake 9: Overlooking Ongoing Compliance Requirements

Compliance does not end with incorporation. Hong Kong companies must:

• File Annual Returns with the Companies Registry

• Maintain a Significant Controllers Register (SCR) in Hong Kong and appoint a Designated Representative

• Renew their Business Registration Certificate annually

• Ensure statutory records (minutes, registers) are properly maintained

Tip: Use a corporate service provider to monitor deadlines and avoid penalties.

Conclusion

Registering a company in Hong Kong is straightforward when you understand the requirements. The most common mistakes arise from confusion about incorporation documents, company secretary obligations, tax and accounting compliance, and post-incorporation duties. By preparing carefully, consulting official sources, and engaging professional advisors, you can set up your business smoothly and focus on growth in Asia’s premier financial hub.