If the Hong Kong company doesn’t operate any more, it is suggested to cancel it.

Consequences of ignore the not operating company
1.Penalty
Once overdue the annual review, penalty 300 HKD.
What’s more, Hong Kong Inland Revenue Department penalty listed as follows:
Overdue more than 42 days but lest than 3months Penalty $870
Overdue more than 3 months but lest than 6 months Penalty $1740
Overdue more than 6 months, but lest than 9 months Penalty $2610
Overdue more than 9 months Penalty $3480

2.Punishment
When the Hong Kong company does not operate or operate regularly,and neither do annual inspection nor apply for cancellation,then the fine will increase continuously after the expiration of the annual audit.If it exceeds three years, it will be cancelled by the companies registry, but the bad record will follow the shareholders for at least seven years.What’s more, enter HK is restricted, visas are refused, investments are rejected, notarized documents cannot be processed, etc., in severe cases, imprisonment of less than one year is imposed.

The conditions of applying for cancellation with operating records are as follows:
1. All shareholders of the company agreed to cancel the registration;
2. The company doesn’t have any business operations, or has stopped operating for more than 3 months before applying for cancellation;
3. The company has no legally binding debt, including government fees and taxes;
4. The company has obtained a written notice from the tax director who has no objection to deregistration.

Documents required for company cancellation
1) a full set of company documents
2) copies of the ID/passports and contact information of the company's shareholders and directors
3) audit report (if any)

Processing time for Hong Kong company cancellation: half a year to 8 months

The procedure of applying for Hong Kong company cancellation:
1.Submit the cancellation application form to the tax bureau
2.One month later, received the notice of cancellation agreement issued by the tax bureau
3.Submit “Company Registration Cancellation Document DR1” to the Company Registry
4.About two months later, the registration registry will issue a notice of cancellation and announce online that the company has been cancelled
5.Three months after the announcement is issued, if no objection, the registration office will cancel company officially.

For further information or assistance, please feel free to contact us.

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