When expanding your business to Hong Kong, one of the statutory requirements is appointing a company secretary. They have a vital role in ensuring that the company complies with government requirements and keeping it up-to-date. Therefore, it is necessary that you engage with a professional company secretary.
This guide will explain why a professional company secretary is essential for your business expansion into Hong Kong and beyond.
Why do Hong Kong companies need a company secretary?
The company secretary is an important representative in a Hong Kong company, and it is a requirement by the Companies Ordinance that private companies appoint a company secretary.
Why is a professional resident company secretary needed?
A company secretary has a significant role for companies expanding into Hong Kong as they serve as links between the company and government authorities. They represent the company and are responsible for all communications with the government.
The secretary’s responsibility is to ensure that the company stays compliant with all regulatory requirements and maintain the company’s statutory books and records.
It is necessary that your company secretary is experienced and has knowledge of Hong Kong’s laws and regulations. Engaging with a professional corporate service firm that provides company secretary services will guarantee that your company has a knowledgeable and qualified company secretary.
One of the primary roles of a company secretary is ensuring tax compliance, and the secretary must have a proper understanding of Hong Kong’s taxation system.
Company secretaries must register the company with the Inland Revenue Department (IRD) and ensure the company’s details are available on the government’s records. They also must lodge tax returns at the end of each year to avoid tax-related penalties.
They should also understand transfer pricing. The secretary should ensure that all transactions are at arm’s length and prepare the required documents within nine months after each accounting period.
The company secretary is also responsible for organising the transfer of shares from the existing shareholder(s) to a new or existing shareholder. During the transfer process, the company secretary must ensure that there are no restrictions on the individual or company that is becoming the new shareholder.
Company secretaries additionally are responsible for planning and managing the process of share allotment in a company. They are responsible for ensuring that the directors are authorised to issue shares, checking that shares are issued in proportion to the existing shares, and sending and processing application forms applying for shares. Once the shares are allotted, the company secretary will have to enter the names of any new shareholders in the register of members and issue share certificates.
Other responsibilities of a company secretary include:
- Update and maintain the company’s statutory book
- Arrange and attend meetings
- Notify the Registry of any statutory changes
- Applying for a business registration certificate
- Assist in the registration and deregistration of the company
- Distribution and transfer of shares
- Make and receive communication from the government
- Prepare and file annual returns
Conclusion
Appointing a company secretary is a statutory requirement for all Hong Kong companies. Company secretaries have an important role in a Hong Kong company, and appointing a professional company secretary will ensure that they have the expertise and experience in Hong Kong laws and rules.
Company secretaries must prepare and file required documents to government bodies on time and make sure that the company is compliant with relevant laws. If you need help finding a trusted and professional company secretary in Hong Kong, feel free to contact Acclime.
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