Newly Appointed President Asia for ADAM Global Network Andre-Reboh presents the benefits of setting up Family Investment Holding Companies in Hong Kong and Singapore during the Annual Members Meeting 2017 held in Greece.
Read more on what he unfolded on the benefits below:
Both Hong Kong and Singapore offer significant benefits to families looking to base their international
holding companies in Asia, as both jurisdictions tax income on a territorial basis (no taxation
of foreign income).
Neither jurisdiction taxes capital gains and there is no withholding tax on dividends paid out from
Hong Kong or Singapore to its shareholders.
From a tax point of view, whether Hong Kong or Singapore is more advantageous depends a great
deal on the underlying assets held by the investment holding company and where such assets are
Companies tax resident in Hong Kong, for example, enjoy one of the most preferential concession
rates of withholding taxes on dividends, interest and royalties paid out of Luxembourg, Indonesia or
If the underlying assets are located in numerous jurisdictions, Singapore may offer more tax-planning
opportunities (for instance with Cambodia, India, Japan and Taiwan but also with Belgium,
Russia, Ukraine, Israel and even Mexico) to minimise tax leakage at the local jurisdictions in which
the assets are held due to its 80-plus double tax treaties.
Finally, it is worth noting that using a Hong Kong company for trading purpose (for instance,
buying goods in China and selling them to Europe, Asia or Middle East) may enjoy a full tax
exemption on profits.
Ease of compliance with regulatory regime
The regulatory regime for companies is broadly similar for both jurisdictions, with both Hong Kong
and Singapore requiring annual general meetings to be held, annual returns to be filed and directors
and shareholders to be disclosed to the relevant companies registry. Various options may be considered
in this respect.
One point worth noting is that a Singapore company must have an individual resident in Singapore
to act as director, whereas the board of directors of a Hong Kong company could comprise entirely
Accounting and audit requirements
Again, the accounting and auditing requirements for Singapore and Hong Kong Companies are
comparable, with a notable difference being that Singapore Companies with an annual turnover below
SG$10 million are not required to audit their accounts, though this exemption from audit is
only applicable if all members of the Singapore company are individuals and not corporates.
Both jurisdictions require consolidated accounts to be provided in respect of group companies,
though the regime is slightly more relaxed in Hong Kong, where consolidated accounts would not
be required if directors are of the opinion that group accounts are impracticable, are of no real value
to the group, or would involve disproportionate expense or delay.
In Singapore, consolidated accounts can only be dispensed with if the ultimate parent produces
consolidated accounts available for public distribution.
For more information, please contact:
André Reboh, Managing Director with JadeStonePartners Group Singapore
Tel: +65 8292 4700/Mobile: +65 9387 3573