Hong Kong company tax return or annual return, or annual filing, is an annual statutory requirement for all the registered business entities to renew and maintain its legal statue to continuously operate for a period. Hong Kong taxes are among the lowest in the world., and the tax regime is simple and predictable.
For a Hong Kong Private Company Limited Company, the most popular business entities in Hong Kong, every members of a Limited Company are legally required to deliver the completed annual return back to the Companies Registry and Inland Revenue Department which are the government authorities for incorporation and taxation before prescribed deadline. The following are the rules for company owner to comply with.
1. Keeping material of company’s transaction and preparing for financial statements
Any business entity is in pursuit of making profits, a company must take par in accounting transactions which are to be book in company’s accounting record but excluding the government required fee with its clients, suppliers and employees. Business owner are required to prepare your company for an annual financial statements in accordance with the Financial Reporting Standards of Hong Kong with respect to the volume and frequency of your company’s financial activities during latest accounting year.
2. Audited Financial Statement of company’s previous accounting year
Statutory reporting are required annually for every Limited Companies, including 3 document: a balance sheet, profit and loss account, and a cash flow statement. The reports must contain audited financial statements for the current year, with corresponding amounts for the preceding year.
3. Filing of Annual Return with Companies Registry (CR)
Each Hong Kong company must lodge an Annual Return (AR) with CR within 1 month. Particulars of the company member, registered address, and auditors (if applicable) must be included in the AR. The attachment of company’s accounts is governed by the applicable rules here.
4. Filing of Annual Tax Return with Inland Revenue Department (IRD)
Each Hong Kong company must file its annual tax return with IRD. Hong Kong adopts year-by-year basis for taxation. The profits for the financial year ending in the preceding year will NOT form the basis for filing the tax return in the current year.
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