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As a Hong Kong limited company, even if the business has no turnover or profit, it is still required to file a profits tax return every year.
The Inland Revenue Department will still review your company's situation to determine your tax filing responsibilities, which typically include submitting a zero-filing tax return for Hong Kong companies.
Tax returns must also be submitted together with audit reports, making the audit process an essential part of annual compliance for almost all operating companies.
If you fail to file a tax return, your business may face Hong Kong tax penalties, potential criminal liability, and be classified as non-compliant by the Inland Revenue Department.
（Company Ordinance）
Under the Companies Ordinance, most companies, except those registered as dormant companies, are required to comply with Hong Kong's auditing requirements. Therefore, auditing is mandatory for almost all operating companies. Audited financial statements must also be submitted along with Form BIR51, which answers the common question of whether Hong Kong companies are required to be audited—the answer is, in the vast majority of cases, yes.
A Hong Kong audit report is essentially a set of audited financial statements that reflect a company's financial position. It typically includes a balance sheet, income statement, cash flow statement, and notes and accounting policies. These documents all follow the standard format of Hong Kong audit reports, clearly summarizing the company's operating performance.
(For practical commercial use)
Auditing is not only about fulfilling compliance obligations; it plays a crucial role in numerous real-world business scenarios. Opening bank accounts, conducting investor due diligence, and loan applications typically all require the submission of audited financial statements. Government-funded projects such as the Hong Kong Productivity Council's Budget Fund and the Technology Voucher Scheme (TVP) also have this requirement. Therefore, the importance of auditing in Hong Kong extends beyond the legal realm; it helps build business trust and supports enterprise development.
Hong Kong companies are required to retain accounting records for seven years, in accordance with accounting regulations. Documents that a Hong Kong company must retain include bank statements, invoices, payroll records, and basic contracts or receipts. Properly maintaining these records helps the company operate in compliance with regulations.
All small businesses in Hong Kong are still required to undergo audits, and there are no arrangements for audit exemptions for small companies. The only exemption applies to inactive companies, which are exempt from audits unless they resume operations. This regulation clarifies that small companies in Hong Kong are still obligated to undergo audits.
Properly maintaining records is part of Hong Kong company accounting requirements and helps avoid audits by the Inland Revenue Department. This section outlines the core documents that Hong Kong companies must keep, and the importance of maintaining these documents.
01
Keep regular records to avoid year-end workload pressure.
02
Use a cloud-based accounting system (such as Xero/QuickBooks).
03
Hire a professional accountant to handle audit, tax and annual return (NAR1) matters.
04
Tax planning (legally reducing tax liability)
Sound financial management helps protect a company and ensures smooth operations.
Maintain compliance to avoid hefty fines for incorrect or overdue declarations.
Organized records and standardized reports can make the audit process faster and smoother.
Identify potential tax risks that your company may overlook before they escalate.
Clear and reliable financial information helps build trust with banks and other stakeholders.
Applicants must be non-governmental and non-funded companies registered in Hong Kong under the Business Registration Ordinance.
There is no limit. A company may nominate multiple employees to attend the same course, provided that they meet the eligibility requirements. However, the same employee may not enrol in the same course more than once for the purpose of applying for funding.
You can contact the program secretariat for assistance, or seek help from a professional secretarial firm like OneSec to assist with the application.
You can contact the program secretariat for assistance, or seek help from a professional secretarial firm like OneSec to assist with the application.
You can contact the program secretariat for assistance, or seek help from a professional secretarial firm like OneSec to assist with the application.
You can contact the program secretariat for assistance, or seek help from a professional secretarial firm like OneSec to assist with the application.
You can contact the program secretariat for assistance, or seek help from a professional secretarial firm like OneSec to assist with the application.
