A Hong Kong company can be closed by deregistration. This is a two-stage process that first requires tax clearance from the Inland Revenue Department and secondly an approval to deregister from the Companies Registry.
To deregister a company, the requirements are :
- The company has been operating for more than 3 months or not at all
- There are no assets other than the bank deposits and cash.
- There are no outstanding debts.
- There are no pending or unsettled legal proceedings.
- All shareholders unanimously agree to deregistration.
- Tax filings are up to date with no outstanding tax liabilities
The process starts by filling out an application for tax clearance to the Inland Revenue Department. The time required for deregistration differs from company to company.
Usually it takes 3 to 6 months for tax clearance
Then another 3 to 6 more months for approval from the Companies Registry.
During the process time it’s not possible to change the company’s shareholders, directors, company secretary or registered office address. A valid Business Registration Certificate, as well continuation with Annual Return filings is required before the deregistration is approved by the Companies Registry.
Note that a Hong Kong company is not considered closed simply by the act of closing the company’s bank account and ignoring the respective requirements mentioned above. The company will remain in existence until the deregistration is approved and completed by the Companies Registry. Ignoring all this process will result with penalties and eventual court summons against all the directors