What are the consequences of a Hong Kong company being forcibly deregistered?  How to prevent risks?

Major foreign trade forums have continuously exposed news of a large number  of offshore accounts being cancelled.

This is also the first time since the CRS global taxation that a large number  of offshore account holders in China have faced such a crisis.

In the past 9 months, the four major OSA accounts in mainland China have been  completely closed, and those without domestic affiliated companies are basically  unable to escape the fate of being closed.

After the account is cancelled, although many foreign trade enterprises are  still seeking new ways to register offshore accounts, many customers choose  to ignore them.

If you do this, the Hong Kong Registry will force your company to be deregistered  in 2-3 years, but do you think that's all there is to it? In fact, there will  be a large wave of court subpoenas and fines waiting for you to resolve.

Because the following three situations may result in court summons and fines:

Failure to submit the profits tax form on time

Failure to pay fees on time

Failure to submit the annual declaration form on time

I'm sure you might ask what's so scary about a subpoena in court? Anyway,  I just ignore it. If that's the case, then you're really wrong!

Ignoring a court summons can result in a significant accumulation of fines.

The company's directors and shareholders have left a negative record with  the Hong Kong government and have been blacklisted. They may be arrested and  questioned at any time upon entering Hong Kong.

It will also be recorded as a personal reputation stain, seriously affecting  future development, and there will be a bad record when going to Hong Kong  or abroad.

The emergence of the above situations will have a huge obstacle to personal  development in the future. Don't wait until problems arise to think about solving  them, as it will be extremely troublesome and expensive.

So in order to avoid unnecessary trouble and losses in the future, your Hong  Kong company must undergo annual tax review and filing on time. If you no longer  use it, you must go through legal procedures to deregister the company. In  the face of unfortunate court subpoenas, you must also handle them in a timely  manner. Don't lose big for small things!

How to cancel a Hong Kong company?

The company can request cancellation under normal circumstances, and entrusting  an agent to handle it is very simple. Just provide the following information:

1. Original copies of the company's registration certificate, business registration  certificate, and articles of association

2. Sign a 'Notice of No Objection to Revocation of Company Registration' (original  government document required)

3. Sign a 'Notice of Termination of Business'

4. Sign a cancellation document

No objection to the notice of revocation of company registration

Hong Kong companies must submit a "Notice of No Objection to the Cancellation  of Company Registration" to the Inland Revenue Department for cancellation.  The notice will be issued within 25 working days after the applicant submits  a valid application and pays the relevant fees.

In the following circumstances, the Director of the Tax Bureau will issue  a notice of no objection:

1. The company has never opened or has ceased operations;

2. The company will not commence/resume operations;

3. The company has sold all inventory, properties, and securities;

4. The company has no outstanding taxes including profits tax, property tax,  stamp duty, business registration fees, fines and court fees related to such  taxes;

5. The company has no outstanding responsibilities under tax regulations,  including failure to return tax returns issued by the tax bureau, and notifying  the director of the tax bureau in writing that the company is taxable for any  tax year but has not received the relevant tax returns for that year;

6. The company has not yet responded to any inquiries sent by the tax bureau;

7. There are no pending objections or appeals regarding the company's tax  assessment.

If the company does not meet any of the above conditions, it will not receive  a notice of no objection.

How long does it take for a Hong Kong company to be deregistered?

It takes approximately six months to eight months for a Hong Kong company  to be deregistered.

The application will be announced twice in the Gazette. After the first gazette  notice is published, there will be a 3-month deadline for raising objections.  If the director does not receive any objections during this period, a second  notice will be published in the Gazette, and the company will be dissolved  at that time. The applicant will receive notification after the completion  of the deregistration process and the dissolution of the company.