Guide to Filing Annual Returns in Hong Kong

Guide to Filing Annual Returns in Hong Kong

Guide to Filing Annual Returns in Hong Kong

Filing annual returns in Hong Kong is a mandatory and regulatory obligation for businesses. From gathering the right documents to understanding the significance of timely submissions, this guide offers a clear pathway through the process, ensuring that you meet all necessary requirements while maintaining the efficiency and integrity of your business operations.

Introduction to Annual Returns in Hong Kong

In Hong Kong, operating a business requires adherence to certain regulatory requirements. One key requirement is filing an annual return with the Hong Kong Companies Registry. This submission provides a yearly snapshot of your company’s fundamental information, promoting transparency and keeping the authorities updated.

What Are Annual Returns?

An annual return (Form NAR1) is a compulsory document that all registered companies in Hong Kong must submit except for certain exempted businesses. It provides a comprehensive overview of your company’s details at a given time.

Why Is Timely Filing of Annual Returns Essential?

Timely filing of annual returns is vital for compliance, credibility, and the smooth operation of your business in Hong Kong. It’s not just a legal formality; it impacts your company’s standing and operations.

Maintaining Compliance and Avoiding Penalties
Late filing breaches the Companies Ordinance, and it may result in fines. In severe cases, it may lead to deregistration, affecting business continuity and reputation.
Preserving Business Credibility
Demonstrating commitment to transparency is crucial for attracting investments, forming partnerships and gaining clients’ trust.
Ensuring Accurate Records
Aligning internal records and the Companies Registry information helps support shareholder communication and maintain legal clarity for your company.
Streamlining Future Processes
Ensure uninterrupted business operations by avoiding delays in business licensing due to pending filings.
Filing of Annual Returns

What Information do I need for my Annual Returns Filing Process?

The NAR1 form itself is a straightforward document designed to capture essential details about your company.

The following is a breakdown of the key information you will require when filling in the NAR1 form:

  • Company Particulars: This section includes basic company information.
  • Share Capital: Details about the total authorised share capital of the company and share types.
  • Directors and Company Secretary: Information about all current directors and the individual appointed as the company secretary, including their full names, residential addresses, nationalities, and HKID (if applicable).
  • Shareholders: A breakdown of your company’s shareholders, including their names and the number of shares they hold.
  • Changes since Last Return: This section is for you to specify any changes in your company’s information since the last annual return filing.
  • Declarations: The form concludes with declarations to be signed by a company director or the company secretary.

What are the Documents Required?

It is important to assemble the essential documents to ensure an accurate filing process, which include:

  • Company Incorporation Certificate: Proof of company registration issued by the Companies Registry upon incorporation.
  • Hong Kong Identity Cards (HKID) or Passports: For directors and shareholders who are Hong Kong residents, you’ll need copies of their HKIDs. For non-resident directors and shareholders, copies of their passport ID pages will suffice.
  • Shareholder Register: This internal document maintains a record of your company’s shareholders.
  • Minutes of the Latest Annual General Meeting (AGM): While not always mandatory, having a copy of the most recent AGM minutes is helpful for reference while completing the form.
  • Updated Company Information: While optional, providing proof of changes to your company, such as a new director’s appointment, is important for the record.

Understanding Your Annual Return Filing Requirements

Navigating the requirements for filing annual returns is crucial for businesses in Hong Kong, to ensure compliance and avoid penalties. Here’s a breakdown of the annual filing deadline, annual filing fees and late filing penalties.

What is the deadline to file Annual Return for Hong Kong companies?

Local private companies are required to submit their annual returns within 42 days after the anniversary of their incorporation date. This means that if a private company was incorporated on 6 May 2023, it is required to file its annual return on 17 June 2024. You can use the Annual Return Filing Calculator to calculate your annual filing due date.

For public companies, if your financial year begins before 3 March 2014, you must file your annual return within 42 days after the date of the company’s Annual General Meeting (the prescribed time period). If your financial year begins on or after 3 March 2014, you must file your annual return within 42 days after the company’s return date. The return date is the date that is 6 months after the end of the company’s accounting reference period. Accounting reference period is the period by reference to which the company’s annual financial statements are to be prepared.

For companies limited by guarantee, if your financial year begins before 3 March 2014, you must file your annual return within 42 days after the date of the company’s Annual General Meeting (the prescribed time period). If your financial year begins on or after 3 March 2014, you must file your annual return within 42 days after the company’s return date. The return date is the date for a guarantee company is 9 months after the end of the company’s accounting reference period. Accounting reference period is the period by reference to which the company’s annual financial statements are to be prepared.

What are the annual filing fees?

For a local private company, an annual registration fee of HK$105 is payable if the annual return is filed within the stipulated deadline.

For a local public company, an annual registration fee of HK$140 is payable if the annual return is filed within the stipulated deadline.

For a local company limited by guarantee, an annual registration fee of HK$105 is payable if the annual return is filed within the stipulated deadline.

Annual Return Filing Calculator

What are the penalties for late filing?

It is important to submit your annual return within the stipulated deadline to avoid the hefty penalties, and in serious cases, the company and its officers (directors, company secretary) can be prosecuted and fined upon conviction. Below is a table of the registration fee payable for the late delivery of an Annual Return.


If the Annual Return is delivered:Private Company (HK$)Local Public Company (HK$)Company limited by Guarantee (HK$)
More than 42 days after but within 3 months after the company’s return date8701,200870
More than 3 months after but within 6 months after the company’s return date17402,4001740
More than 6 months after but within 9 months after the company’s return date2,6103,6002,610
More than 9 months after the company’s return date3,4804,8003,480

Pro Tips for Efficient Filing

Ensuring a smooth filing process can be significantly streamlined with these expert tips:

  • Digital Preparation: Organise documents digitally for quicker online submission.
  • Guidance Resources: Utilise the on the NAR1 form from the Companies Registry for detailed instructions.
  • Reminder Systems: Set early reminders to allocate sufficient time for document preparation, form completion, and submission.
  • Professional Assistance: For companies with complex structures, leveraging services from professionals like accountants or corporate secretarial service providers, such as BoardRoom, can ensure precise filing and compliance.

Common Misconceptions About Annual Returns

Filing an annual return can be a daunting task. Thus it is vital to clarify some common misconceptions ahead of time so you can complete the process smoothly.

The Purpose of Annual Returns
Contrary to popular belief, annual returns do not measure a company’s financial performance. Their primary purpose is to keep the Companies Registry updated with current details about your company’s key information.
Frequency of Filing
A common error among newcomers is the assumption that annual returns are a one-off requirement. In reality, these are yearly obligations. Filing is not required in the year the company was incorporated.
Who Needs to File
The assumption that only public companies are obligated to file annual returns is wrong. All registered entities in Hong Kong, barring certain exemptions, must fulfil this requirement, regardless of their status as private or public companies.
Complexity of Filing
The perception that filing an annual return is a burdensome process laden with paperwork is outdated. With the advent of online platforms like the e-Services Portal, submitting your NAR1 form has become a streamlined process.
Reporting Company Changes
Overlooking the need to report minor updates is a misstep. Every alteration, be it a change in directorship or company address, needs accurate representation in your next annual return to avoid legal and compliance complications.

Your Checklist for a Hassle-Free Filing

To streamline your annual returns filing process, here’s a comprehensive checklist to guide you from preparation to post-submission.


    Preparation Phase

    Start these preparations at least a month before your filing deadline:

    • Gather Documents: Assemble all necessary documentation, including your company’s incorporation certificate, directors’ or shareholders’ ID copies, the shareholder register, and the latest AGM minutes, if they’re relevant.

    • Review Company Information: Verify any recent changes, such as new director appointments or address updates.

    • Familiarise Yourself with the Form: Obtain the NAR1 form and review the guide provided by the Companies Registry to ensure accurate completion.

    Filing Process

    Follow this step-by-step guide two weeks prior to the deadline to ensure timely filing:

    • Step 1 – Prepare Soft Copies: Ensure you have digital versions of all required documents.

    • Step 2 – Access the e-Services Portal: Navigate to the Companies Registry’s e-Services Portal.

    • Step 3 – Complete the NAR1 Form Electronically: Fill in the form carefully with the necessary details.

    • Step 4 – Review and Submit: Double-check the information for accuracy, then proceed to submit and pay the filing fee through the portal’s payment options.


    Within one week after the filing, you should finish the following tasks:

    • Verify Submission: Check your email for the receipt and confirmation from the Companies Registry acknowledging your successful submission.

    • Retain Records: Keep digital or physical copies of the submitted NAR1 form, payment receipt, and other pertinent documentation for future reference.


    How Can We Help with Your Annual Returns Filing?

    At BoardRoom Hong Kong, we offer professional corporate secretarial services with a dedicated team of specialists to simplify your annual returns filing process. We handle all aspects of filing, from gathering documents to meeting deadlines, guaranteeing your company’s compliance with regulations. This allows you to focus your valuable time and resources on core business activities.

    Looking to streamline your annual returns filing process today? Let us guide you through every step with our tailored advice.

    Frequently Asked Questions (FAQs)

    Are foreign companies operating in Hong Kong required to submit annual returns?

    Yes. Foreign companies with operations in Hong Kong, such as branch offices, are generally obligated to submit annual returns. Nonetheless, their requirements may vary slightly compared to domestic businesses.

    What companies are exempt from filing annual returns in Hong Kong?

    Sole proprietorships in Hong Kong are usually exempt from filing annual returns. Owned and run by a single individual with unlimited liability, they are not subject to the formal registration process typically demanded of other business types.

    Can I file an annual return by mail or fax?

    The Hong Kong Companies Registry prioritises submissions through its e-Services Portal for efficiency and compliance. While paper filings may have been possible in the past, it’s advisable to confirm directly with the Registry to ensure a compliant filing process.

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    Make the transition to outsourced accounting services to grow your business

    Make the transition to outsourced accounting services to grow your business

    If your firm intends to expand throughout the Asia-Pacific region (APAC), outsourced accounting services can help you achieve seamless business growth in an unpredictable economic climate.

    Given the complexities of the accounting function, it is common for business owners to be intimidated by the notion of hiring outside staff. In this article, we will look at how outsourcing can be used to create a smart business model and what actions you should take to guarantee a smooth transition.

    Why use outsourced accounting firms?

    Because of the numerous advantages of outsourcing accounting and bookkeeping, it is becoming a common alternative for APAC firms. In fact, according to a 2020 global study, over half of finance accounting professionals are contemplating outsourcing additional tasks.

    This can be attributed to three significant factors.

    1. Access to expert knowledge and skills

    Outsourcing gives businesses access to qualified professionals with a high degree of relevant knowledge and expertise – attributes that are not always simple to achieve through recruiting.

    “Companies frequently want to shift to outsourcing because they’re seeking specialists who can help them enhance their procedures,” says Yang Shuzhen, BoardRoom’s Accounting Director.

    Operational teams and managers are typically preoccupied with day-to-day operations, making it challenging to examine procedures objectively and discover opportunities for change. This is just one example of how an outside team might assist.

    “During COVID, many people working in Asia returned to their home countries, which has caused a shortage in the labour market,” Shuzhen notes. “Because of this, many APAC firms cannot source talent with the skills and experience they require.”

    2. Reliable and prompt service

    Accounting outsourcing provides immediate, practical support at a time when finance personnel turnover is rampant.

    “A lot of financial professionals want to take a break or try a totally new industry,” Shuzhen explains. “As a result, individuals are leaving, and in many cases, businesses cannot replace them at the same rate.”

    This can lead to insufficient handovers and employee shortages, causing transactions and procedures to fall between the cracks. Businesses confronted with these issues would consequently seek the assistance of an external provider with a pool of trained, professional accountants ready to analyse the situation and take over the processing.

    “They require experts who are experienced enough not just to take over their accounting duties but also to advise them moving ahead,” Shuzhen explains. “An external team can assist you in developing standard operating procedures and internal controls, both of which are essential for success.”

    Reliable and prompt service

    3. Digital transformation insights

    The accounting sector is undergoing significant development, with digital transformation providing opportunities to translate data into valuable business insights. The finance function is increasingly expected to contribute to the advancement of the strategic goals for a business in addition to executing transactional activities, which means that the required skill set for finance professionals is changing.

    According to A 2020 Deloitte study, finance’s new position as a strategic business partner would necessitate firms balancing human and machine-based skills while reflecting the four future-ready company qualities: analytical, adaptable, agile and anticipatory.

    The data analytics skills and technical experience necessary to do this can be challenging to maintain internally, which is why many organisations seek the assistance of premium outsourced accounting services.

    The COVID-19 pandemic has intensified outsourcing demand even further, with the global finance and accounting outsourcing industry predicted to reach USD 53.4 billion by 2026. This is mainly owing to a widespread demand for efficient solutions and stability in difficult times, which corporate services providers can deliver.

    Challenges faced by in-house accounting

    There are two primary reasons why APAC organisations are moving away from in-house accounting.

    Intensive labour is involved

    Recruiting, training and managing a finance team is time-consuming, as is expanding the team as your company grows.

    “A fast-growing organisation will devote a significant amount of money to educating the workforce, maintaining morale and ensuring the team functions properly,” Shuzhen explains. “This is significant because strong financials and timely reporting benefit the company when stakeholders make decisions.”

    However, resignations may be difficult for a team. Businesses may invest time in effective handovers and training for the new staff, but there will be a learning curve, so they will not have the same influence as the prior team. There is also no assurance that the workers will remain for an extended period.

    “Deliverables may be impacted when these changes become frequent and handover times are short,” Shuzhen warns.

    Technological changes are difficult to adapt

    Across APAC, digital innovation places pressure on internal teams to embrace new, more complex accounting systems.

    While this adaptability is necessary for continuous productivity, workforce constraints caused by the Great Resignation mean that there is frequently little time to guarantee new systems are implemented correctly. As a result, the new software may become a barrier rather than an aid, resulting in further delays and investment.

    An experienced accounting partner can efficiently negotiate with software providers to ensure that new systems are correctly customised to your firm. They can also plan a smooth and smart rollout of the new software, ensuring that the most critical solutions are installed first.

    How to outsource accounting services

    For a simple transition to outsourced accounting services in Hong Kong, we propose the following steps:

    1. Consider the accounting issues you are presently dealing with and the solutions you want to find through outsourcing.
    2. Examine the budget you have for accounting outsourcing.
    3. Get in touch with a reliable accounting services provider. They will meet with you to discuss your present position, assist you in gathering the essential information and advise you on the next steps.
    4. Inquire about the firm’s accounting software options to discover which is best for your company.

    A good provider will prioritise the critical tasks that require attention. Once things are under control, they will collaborate with you to develop a comprehensive end-to-end accounting solution for your company, as well as a tailored approach to advice.

    To set the initial onboarding and subsequent relationship up for success, evaluate who in your organisation is most suited to engage with them directly.

    The designated individual might be a finance manager, CEO, firm owner or director; the most essential thing is that they have extensive financial expertise and can discuss financial topics in depth. This will also assist in guaranteeing that the final solutions are matched to your specific requirements.

    Asian Accountant

    Making the right choice for your business

    Like an in-house team, your accounting services provider should integrate smoothly with your firm and have a deep awareness of your challenges. Your partner should deliver all the benefits of an in-house team while eliminating all the negatives. Once we have gained a deep understanding of your issues, we can provide all the benefits of an in-house team while removing the disadvantages.

    From accounts receivable and payments to general ledger and financial reporting, a full-service business can handle all areas of your accounting and bookkeeping. They will also be able to give business support in other areas, such as cash flow management, to assist your firm in meeting its objectives.

    “Our accounting solution at BoardRoom extends beyond transactional processing,” Shuzhen explains. “Financial data may be quite beneficial, and we utilise it extensively when advising our customers.”

    It is critical to seek an experienced accounting services provider since they can quickly and readily discover effective solutions to any accounting difficulties you may be experiencing. You will also know that the next time your firm is audited, it will have followed all of the proper protocols.

    Accounting outsourcing: what to avoid

    If you’re thinking about switching to accounting outsourcing, get started now.

    Businesses sometimes waste valuable resources attempting to handle accounting issues independently when an external services provider might have stepped in far earlier and implemented solutions in a much shorter time.

    Even if the organisation is small, financial commitments and difficulties can swiftly add up. So, if you are establishing a new organisation or branch in a neighbouring nation, it is important to hire an external team from the beginning to verify that the proper accounting processes are in place.

    The longer you put off outsourcing, the more difficult and time-consuming it can be to organise your finances and resolve problems.

    Outsource accounting services

    What are the benefits of outsourcing for business growth?

    If your firm has expansion plans, an accounting services provider might be a beneficial business partner.

    They can help you by:

    Offering thorough guidance and precise data at any time (so you can make quick decisions)
    Generating reports for possible investors
    Preparing financial ratios so you can have timely interactions with banks

    An accounting partner can also assist in establishing internal accounting controls at your headquarters and implementing these among finance units in other countries. Because you have identical internal controls throughout your regional sites, you can quickly generate reliable group-wide statistics at any time of year.

    Compliance with multi-country regulations

    Accounting partners also help businesses thrive by guaranteeing full regulatory compliance, including drafting and submitting statutory reports.

    In terms of your Hong Kong duties, an accounting partner will ensure that all your Hong Kong Financial Reporting requirements are completed and filed on time. Choosing a provider who supports multiple regions is crucial as other APAC areas will have distinct regulatory regimes, some of which may be quite rigorous and complicated.

    They can also ensure that your business is achieving its local compliance obligations on an ongoing basis by consolidating taxes with a worldwide organisation.

    Begin your transition to outsourcing your accounting services

    An expert accounting team working in close partnership with your internal team is critical to ensuring a smooth and lucrative trajectory, regardless of where you are in your expansion journey.

    Please contact us to learn more about BoardRoom’s world-class accounting and bookkeeping services, as well as our complementary payroll outsourcing and tax advisory solutions.

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    Cloud Accounting with Xero and BoardRoom – Make it work for you

    Cloud accounting with Xero and BoardRoom

    Cloud Accounting with Xero and BoardRoom – Make it work for you

    Cloud Accounting with Xero and BoardRoom Hong Kong – Make it work for you

    Cloud accounting platforms like Xero are well recognised for their benefits such as saving time, money and effort for companies in Hong Kong – big and small. It can improve your finance team’s productivity and speed up processing of payments and invoices, which means your company is getting paid faster.

    Even so, there are still companies hesitant to make the switch from traditional accounting to a cloud accounting system.

    A common concern is the set up and migration of existing financial data into Xero which can be difficult, particularly so for companies with complex structures, or small businesses with fewer resources. This can make implementation time-consuming and hinder your company from realising the full benefits of Xero.

    The solution? By working with the right Xero partner like BoardRoom, your switch to Xero cloud accounting solution can be a seamless and rewarding experience. Our Xero online accounting experts in Hong Kong will advise and guide you through the process on how you can best optimise Xero to your benefits, effectively improving your accounting and business tools.

    Leave traditional accounting behind today

    Cloud accounting uses online software and stores the data from your accounts in the cloud. ‘The Cloud’ is a network of remote servers storing vast amounts of data. In contrast, traditional accounting software is installed locally on your computer with data stored on a hard drive or a server on-site.

    While traditional accounting has its benefits such as not requiring an internet connection and having full control over your security levels and access, it is heavily dependent on ensuring that updates and data backup are done continually. When in comparison, the benefits of cloud accounting far outweigh those of traditional accounting.

    Cloud accounting software makes it easier for your team to access and collaborate, all without the need for additional hardware costs and software expenses. It also offers your company a real-time snapshot of business performance while providing data security and protection. But perhaps the most important aspect for a business owner is that cloud accounting helps you save time and improve accuracy, which assists your company run more efficiently. This is why many companies in Hong Kong use cloud accounting, like Xero.

    Xero accounting implementation made easy with the right partner in Hong Kong

    The complexities of Hong Kong’s regulation make changing to a new accounting system challenging. However, with a team that’s experienced in implementing a new professional accounting system such as Xero for companies in Hong Kong, organisations can avoid potential pitfalls such as misplaced data or accidentally limiting essential user access.

    Finding the right affiliate can be as simple as looking at the partners that are certified as a Xero consultant. BoardRoom for one is a XeroTM Gold Champion Partner that has consistently showcase our expertise in implementing Xero for a wide range of company profiles.



    We’re experienced in transferring your company’s data from your existing accounting system to Xero. Once you have provided us with the necessary data, we will work in the background to set up your Xero file setup according to your needs. This means minimal downtime for your team while they continue working as per normal.

    Our support does not just end at set-up – we also ensure that your team is confident in fully optimising the Xero platform. This includes training and support services to facilitate the change management process for your team. Our Hong Kong team is also just an email, phone, or video conference call away to support your team with any Xero enquiries.

    Challenges of Xero set-up and migration for complex company structures

    Data migration and change in accounting platforms are especially tricky for companies with a complex structure. Strategic planning is often needed to ensure your company structure is reflected correctly in Xero and that it meets any regulatory reporting requirements in Hong Kong.

    Companies may risk errors, issues, and potentially expensive faults when switching accounting platforms. Improper set-up and migration of data may lead to long-term problems such as not being able to meet regulatory reporting requirements. Having a partner with the right qualifications like BoardRoom can help avoid these pitfalls and save you time further down the road.

    Our Xero data migration services ensure a complete data migration, comparative balances migration and porting over of last closing balances. Additionally, our online training modules will guide your team through purchase, sales, bank transactions and reconciliation, cash flow, inventory, sending online invoices, generating financial reports, in addition to other advanced features.

    accounting software

    Making Xero accounting right for your company in Hong Kong

    How do you get the most out of Xero accounting software, especially with limited resources? With thousands of apps and integration available on Xero, BoardRoom Hong Kong helps to cut out the guesswork by recommending the right ones that best suits your company needs.

    We also customise your chart of accounts or report templates, incorporate your logo into financial documents, or set-up tracking categories and contacts – plus more. Most importantly, we’ll provide the necessary training to ensure that your team is set towards success.

    Grow your business with BoardRoom’s regional expertise

    When you partner with BoardRoom, you’re not working with a regular accountancy firm. As professional services experts, we operate across multiple jurisdictions and offer a wealth of knowledge on all aspects of company administration. This means that no matter where your offices are located, whether Hong Kong, Singapore, Malaysia, China or Australia, we can assist you to seamlessly integrate all of your accounts functions and accounting services through your Xero accounting system.

    In addition to Xero set-up and migration, we also provide incorporation, share registry, company secretarial, payroll, plus many other administrative services. Therefore, by partnering with BoardRoom, your company gains access to our wide range of skills and expertise to assist your administration and accounts teams operate more efficiently.



    xero implementation partners

    Xero consultations are available for full scale migration, set-up, or integration of systems – such as payroll or point of sale. No matter the complexity of your company structure or which accounting system you’ve been using, our team of experts is always ready to provide support through every step of the way.

    Find out more today on how partnering with BoardRoom can save you time and money for your Xero implementation needs.

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    5 Ways accounting outsourcing services add business value

    5 Ways accounting outsourcing services add business value

    5 ways outsourcing accounting services can help your business grow

    Many companies outsource their tax and bookkeeping responsibilities, but still use in-house teams for all other accounting functions. If your company is among them, it may be worth reconsidering. What if you could outsource all of your accounting, bookkeeping and tax functions in a way that not only reduces costs and minimises risk, but also increases revenue growth potential?

    An expert accounting services firm in Hong Kong can help you do just that by offering strategic accounting services.

    Specifically, here are five ways that outsourcing accounting services can help your business flourish.

    01 Facilitate business growth and expansion

    Outsourcing accounting services can help to clarify your company’s financial health status. A complete picture of your company’s finances enables you to make more informed decisions. This becomes critical when you are planning for business growth and expansion.

    Our team of professional chartered accountants at BoardRoom can help by painting a clearer picture of your company’s current cash flow and seasonality. They have the expertise to critically analyse your receivables and collections, so you can more effectively assess organisational performance. With this information, you can then make the best strategic decisions for your business.

    02 Identify all the tax breaks your company may be entitled to

    Navigating Hong Kong’s complex tax regulations can be challenging. Without expert accounting support, it can be easy to miss out on the tax breaks and exemptions your business is entitled to. The best way to maximise your company’s savings and deductions is to work with a professional corporate service provider who understand Hong Kong’s regulations.

    Our team of tax experts at BoardRoom are not only well versed in local tax regulations, but they also have in-depth knowledge of international tax treaties. With professional advice, your organisation can avoid any double tax issues. What’s more, our team will go the extra mile to apply for any tax incentives that could benefit your business.

    outsourcing accounting

    03 Flag potential risk oversights in your tax and financial statements

    As your company grows, the compliance regulations only become more complex. A single oversight in your company’s tax statements or profit and loss statements could result in hefty financial penalties.

    Mitigate these risks and reduce your team’s administrative burden by working with a professional Hong Kong accounting firm that has extensive experience in local tax laws and procedures. Your company will gain access to a team of experts who will flag any irregularities to ensure compliance.

    In short, your business will avoid any costly compliance pitfalls, and you will get to enjoy greater peace of mind.

    04 Digitalising your accounting function

    Accounting and bookkeeping generate a lot of manual paperwork. Analogue records make finding and retrieving data difficult.

    The good news is that you can take advantage of outsourcing accounting and bookkeeping services to guide your company’s digitisation efforts. An experienced corporate services firm can help you streamline the entire accounting workflow seamlessly through a cloud accounting platform such as Xero.

    With a cloud-based solution, you can simplify mundane tasks such as invoicing and reconciliation, with real-time collaboration among team members anywhere, anytime. This provides your company an accurate snapshot of business performance so you can make informed decisions, while ensuring data security with robust encryption measures.

    05 Reduce accounting overheads and free up resources

    Having one or two experienced full-time accountants in-house can cost thousands of dollars a month. Add to that the costs involved in hiring, inducting and training these employees.

    In contrast, outsourcing accounting functions to a professional services provider means you might not need an in-house accounting team at all. Reducing salary overheads frees up company resources that could be better spent on increasing revenue.

    Besides this, your company will also gain access to an entire team of accounting experts who can provide strategic advice on sustainable cost-cutting strategies to managing bookkeeping and tax.

    Are you looking for a trusted accounting firm in Hong Kong?

    BoardRoom is a regional accounting firm in Hong Kong that caters to large corporations and fast-growing SMEs. Our expertise extends from strategically outsourcing accounting services to managing statutory compliance reporting for companies across the Asia-Pacific Region.

    Speak to one of our accounting experts today about how your company can regain precious resources and refocus them on what matters – growing your business.

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    5 ways outsourcing accounting can boost financial health

    Outsourcing your accounting can save your business time and money

    5 ways outsourcing accounting can boost financial health

    5 ways that outsourcing your accounting function can boost your company’s financial health

    “Essential but not efficient”…

    If that sounds like an accurate description of your company’s accounting function, it might be time to consider outsourcing to a specialist accounting services provider.

    Not only will you gain more time to focus on business growth, but it can also be a more efficient use of your company’s resources. Perhaps the idea of outsourcing your accounting, tax and bookkeeping responsibilities sounds appealing, but you wonder how to make it work for your company’s unique needs.

    If so, this article will take you through the top five ways that outsourcing your accounting function can boost your company’s financial health.

    What is Outsourced Accounting?

    Outsourced Accounting is when an organisation chooses to use an accounting service provider to manage the accounting and financial functions of its business. By outsourcing these functions, the business reduces the need for an in-house accounting department and allows these owners to focus on their business.

    Accounting firms offer a variety of services, which may include bookkeeping, financial reporting, management accounting, tax preparation, accounts payable and receivable, debt collection, cashflow management and reporting, and other related services such as payroll processing. Whether you need a short-term solution or a permanent resolution, outsourcing your accounting is an effective go-to option infast-moving business environments such as Hong Kong.

    The outsourced accounting firm takes on the day-to-day accounting tasks and ensures that financial records are accurate, compliant with regulations, and up-to-date. They may use accounting software and systems to streamline processes, automate tasks, and provide timely financial information and reports to the client.

    Who is Outsourced Accounting for?

    With advancements in technology and remote work capabilities, companies of all sizes can benefit from outsourcing accounting.

    Smaller businesses, growing companies and not-for-profit organisations may consider outsourcing their accounting. It allows them to access specialised expertise, reduce overhead costs, ensure compliance, and focus on their core competencies while leaving their accounting needs in the hands of experienced professionals.

    In addition, business owners who require temporary accounting help can consider outsourcing their accounting. Services that can be outsourced can range from accounting audits or end-of-year reporting for these cases.

    Regardless of your organisation’s size, outsourcing your accounting functions can offload these tasks to professionals in the field and benefit from cost savings, access to expertise, improved efficiency, and scalability.

    01 Get access to expert accountants without increasing salary expenses

    Instead of accumulating overheads with an in-house accounting team, you will create cost savings by outsourcing to an expert services provider.

    This gives you access to a team of accounting professionals without needing to spend on recruitment, training, wages or employee benefits.

    Our team of professional chartered accountants at BoardRoom can streamline your accounting function while ensuring you meet all of your compliance obligations.

    02 Gain clearer insights to support your business growth

    Outsourcing to a credible accounting firm can help you better understand your company’s receivables, credits and collections. This, in turn, can generate a clear picture of your cash flow and revenue seasonality.

    Understanding this information can then create clarity around your company’s overall financial health, providing greater insights into specific areas of growth potential. As an end result, you can make smarter, more informed decisions about your company’s future direction.

    For example, those newfound insights might suggest that the time is right to open another local or overseas branch or hire some new employees. In either case, as the leading corporate and advisory services provider in the Asia-Pacific Region, the BoardRoom team can help:

    • Our setup and incorporation experts can help you to establish a new branch, either locally or across the region, including in Singapore, Malaysia or Australia.
    • Our payroll experts can assist you in automating your company’s payroll management to more effectively manage your human capital.
    Gain clearer insights when outsourcing accounting

    03 Avoid costly penalties by staying compliant

    Running a large, multi-national company can be time-consuming and expensive. As your company grows, so too does the complexity of your tax reporting obligations. The last thing you want is to be in breach of the Hong Kong Inland Revenue Department’s (IRD’s) compliance requirements. At best, that may result in an audit. At worst, you could incur significant financial penalties.

    For example, failing to meet your tax filing obligations can result in costly penalties. If you mistakenly leave some tax unpaid in Hong Kong, the IRD considers the outstanding amount to be a tax default. As such, it will take recovery actions and add a 5% surcharge onto the unpaid tax balance. The second instalment will then be due immediately if the first instalment is late. After six months, the IRD will impose an additional 10% surcharge on any outstanding balance.

    However, a professional firm like BoardRoom is well-versed in tax law compliance. Outsourcing your accounting function to our team of taxation specialists can help your company to avoid any costly pitfalls.

    04 Maximise savings with the tax breaks your company is entitled to

    Your company is probably entitled to several tax breaks, but you may not be aware of all of them, they are also ever-changing so it can be hard to stay up-to-date. For example, businesses in Hong Kong with an annual profit of less than HK$ 2,000,000 need only pay a tax of 8.25%. That is half the regular corporate tax rate.

    The IRD also released several business tax measures in its 2021-22 budget, including profit tax reductions and registration fee waivers. Hong Kong has signed a number of double tax treaties, the benefits to Hong Kong companies are numerous.

    Read more about the Hong Kong Budget 2021-22 Report

    Tax experts at a specialist accounting services provider like BoardRoom can help you to take advantage of all of these tax breaks – and more – while staying compliant. Our team will also go the extra mile and apply for any tax incentives that could benefit your company.

    Efficiency of accounting

    05 Increase efficiency with an organised, automated accounting flow

    To increase efficiency, your company must have digital accounting records. This makes your data easier to analyse, which can help you to identify more insights into the most profitable areas of your business to drive growth.

    Our team of professional accountants at BoardRoom can set up a secure, cloud-based financial management system for your company. We can also integrate payroll and claims submissions into the platform to further streamline your accounting flow and improve efficiency.

    How Boardroom's expert accounting services can boost your company’s financial health

    Accurate, reliable accounting is at the core of every successful company in Hong Kong. However, outsourcing your accounting function to expert service providers like BoardRoom removes the need for an in-house team. This helps you to save on employee overheads while still maintaining access to a professional team of chartered accountants.

    To maximise your company’s financial health, our accounting experts will help you to:

    • stay compliant;
    • maximise your tax benefits;
    • keep you organised; and
    • offer you clearer insights into your company’s growth potential.

    Get in touch with our professional chartered accountant team today to learn more about our accounting services and how they can help to boost your company’s financial health.

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    Does your business survival depend on sustainable cost-cutting strategies?

    cost-cutting strategies

    Does your business survival depend on sustainable cost-cutting strategies?

    Which costs to cut to secure your business’ future

    Key insights

    • Cost-cuttingdemands strategies that adopt a sustainable approach to operational efficiency and employee wellbeing
    • Efficient management of working capital supports a renewed focus onthe immediate, medium, and long-term impact
    • Smart outsourcing with trusted partners sharpens expertise across critical operations


    After experiencing a slowdown in recent years, both the US and European economies have had an impact on the Asian export market, contributing to its export decline in 2023. This is the type of economic downturn that traditionally results in retrenching employees as an immediate cost-cutting measure.

    However, the global trend has driven a people-first approach to managing through this unprecedented downturn; every business has customers and stakeholders watching how they respond to market challenges to balance people and profit.

    Leaders ready to do things differently can look to sustainable cost-cutting strategies for guiding their companies through change with reduced risk in 2024:

    1. Smart management of working capital
    2. Outsourcing payroll or improving processes
    3. Outsourcing finance, tax,and accounting services
    4. Administering Employee stock option plans
    5. Leverage industry grants and economic stimulus

    By prioritising what drives value for your organisation in the long-term, sustainable cost-cutting strategies focus on positioning the company to survive now and thrive through an economic recovery.

    01 Smart management of working capital

    Cash flow is critical in a crisis, and minimising investment in working capital — what we spend to get the job done and keep the business running — is vital.

    In 2023, there has been a shift in focus towards operational efficiencies, and effective working capital management. Growth and development may be temporarily on the back burner, but this is the time to get the business-critical functions of your organisation right. Containing costs to minimise reliance on lenders will position your business to recover strongly as economic conditions bounce back from a slowdown in 2023.

    A renewed interest in working capital demands a critical assessment of the entire sales pipeline; inventory levels, distribution points, and product viability are all on the table.

    Smart leaders are looking at strategies for cost-cutting, including:

    • Proactive Invoicing — offering customer incentives like early payment discounts
    • Cash Management — paying suppliers when they’re due, not before
    • Inventory — lowering stock thresholds to reduce risk butmaintain agreed customer service levels
    • Reducing overheads by outsourcing backend services

    Next steps: Assess your working capital costs and financial forecasts to confirm what you can bring inhouse and which backend services are smarter to outsource.

    02 Outsource your payroll or improve your processes

    Outsourcing backend services like payroll has a poor reputation as being the inevitable result of retrenchment or a sign of instability. However, payroll processes are crucial to managing through an economic downturn or slowdown. Having a smooth payroll process drives employee satisfaction, increases employee morale and reduces the risks of payroll legislative penalties,

    There are two ways to outsource payroll to streamline operations:

    • Completely outsourcing the payroll function and services to an external provider
    • Using a cloud-based SaaS HR management system (“HRMS”) — this freesup HR from administrative tasks by empowering automatic and self-service tasks.

    Outsourcing your full payroll function reduces HR management intervention, granting flexibility for other in-house duties such as growing the team and business. It is especially advantageous for global expansion, ensuring lean and effective payroll operations team that is in compliance with local regulations.

    As payroll requires numerous tasks relating to the calculation and processing of employee salaries, benefits and deductions, having a cloud-based SaaS HR system further enhances the efficiency of payroll outsourcing. Your payroll tasks can now be executed remotely while your service provider handles the maintenance, technical support, and data backup. Additionally, outsourcing your payroll with a SaaS HR management system can often be more cost-effective compared to employing a dedicated HR professional to handle the same tasks.

    Overall, these two approaches can also unlock unexpected benefits and expose the significant opportunity cost of not outsourcing key functions, boosting visibility, streamlining internal processes, and staying compliant across multi-country payroll and tax conditions.

    Each model can benefit their corporate objectives while managing costs, cross-border functionality, and the personal data privacy of employees.

    Next steps: Find Boardroom’s payroll outsourcing services or SAAS solutions to streamline your payroll management according to your business needs.

    03 Outsource backend financial support across accounting and tax planning

    In an economic downturn, every organisation focuses on the very core of the business: the what and the why. It’s never been more important to have experts aligning your financial processes and procedures with your organisational goals. One core consideration in cost reduction is to consider outsourcing your accounting and bookkeeping services to ensure the business runs smoothly, while internal staff focuses on business survival and generating revenue.

    By choosing a financial services partner equipped to manage your operational and strategic finances and accounting, businesses bring external expertise and new perspectives on long-term accounting and tax planning.

    Support for accounting functions may include:

    • Ensuring your bookkeeping and accounting comply with local standards in Hong Kong
    • Providing detailed insight into your business by performing thorough analysis on your P&L (Profit and Loss), EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) ratios
    • Streamlining your operations by sorting accounting reports, consolidating group accounts, and offering payment support facilities for correct fund distribution and administration

    Support for tax planning may include:

    • Location planning for tax offset maximisation
    • Streamlining cross-border transactions to simplify complex deals
    • Minimising and deferring payments while staying fully compliant
    • Strategic planning to leverage falling asset values

    An additional unexpected benefit of external support across accounting, tax, and financial reporting is the establishment of effective data reporting, analysis, and forecasting. This data helps to inform planning, working capital decisions, and support for your enterprise to apply for eligible economic grants and stimulus packages and ensure the governance is in place to stay compliant with funding conditions.

    Next steps: Put all your financial operations on the table for expert review. Focus internal skills on long-term planning and get external support for tax, accounting and reporting.

    04 Empower the team with employee stock option plans for talent retention

    The business landscape of Hong Kong is highly competitive with intense demand for talented individuals. To thrive in this environment and achieve sustainable growth in a business, attracting and retaining talent have become the key. However, traditional methods of employee compensation may not always be feasible, especially when your cash flow is limited. If you don’t have cash on hand but want to reward and retain employees, consider an Employee Stock Options Plans (“ESOPs”).

    As companies like Slack and Atlassian have led the way in remote-first workforces, competition for skilled employees demands a different way of approaching the employee experience. Unlocking benefits of employee equity plans have been increasingly popular in recent years as companies look for a different approach to boost employee engagement and maintain productivity.

    Create a purpose-built plan to fit your organisation’s and employee’s needs and create a sense of ownership to keep the best and brightest employed in the long term. Your new stock plan — or updates to your current plan should:

    • Keep liquidity by creating long-term incentives to replace short-term cash bonusesor salary increase expectations
    • Reward high-performance and employees who increase operational efficiency during an economic downturn
    • Use performance metrics relevant to your organisation — look at total shareholder returns (“TSR”), client retention, and return on equity (“ROE”) and adapt goals to conditions
    • Drive growth by incentivising staff towards a common business goal

    Next steps: Contact BoardRoom to help you manage your Hong Kong-based or global ESOP and keep the workforce focused on revenue-generating initiatives.

    05 Access government and industry grants and economic stimulus

    Going through the economic slowdown in 2023, Asian markets have seen a new range of government and industry grants and other economic stimulus packages. These initiatives include the Funding Scheme for Youth Entrepreneurship in the Guangdong-Hong Kong-Macao Greater Bay Area, which provides entrepreneurial support and incubation programmes to young entrepreneurs in Hong Kong, along with capital subsidies. Additionally, the SME Financing Guarantee Scheme enables smaller-sized enterprises to secure financing from lenders to meet their business requirements, while the Information Technology Development Matching Fund Scheme supports travel agents in implementing upgrades within the sector.

    If your organisation operates across borders or is open to funding to expand operations, you may be eligible for funding support.

    Support from government or industry grants demands stringent corporate governance; you may need a guide to accessing, implementing, and leveraging new opportunities across borders.

    Next steps: Get expert help to find Hong Kong support for enterprise and cross-border funding opportunities, apply for funding, and stay compliant across jurisdictions.

    How sustainable is your cost-cutting in 2024?

    Cost-cutting strategies to manage through an economic slowdown look different today from the Global Financial Crisis or the crash; leaders must balance short-term needs with long-term business survival.

    It is no longer enough to rely on reducing headcounts, freezing salaries, and scrambling to maintain productivity to achieve cost-cutting goals. Smart organisations are taking new strategies and approaches to old problems: keeping employees committed with stock options over pay rises, looking for market and industry support, and getting smarter about the benefits of outsourcing.

    The right outsourcing partnerships are key; who you choose to support your business can define your organisation and your leadership. Look for providers that support your workforce with administrative and financial expertise that drives business recovery.

    Talk to BoardRoom about support for sustainable cost-cutting strategies.

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    Top Five Benefits of Accounting Services


    Top Five Benefits of Accounting Services

    Despite accounting’s position as a critical and essential function in establishing robust financial management for organisations, many business owners are still opting to manage their accounting in-house. In doing so, they waste valuable resources and increase their susceptibility to non-compliance issues that could lead to unnecessary costs, hefty penalties, and diminish their chances of business success. It also becomes challenging for companies that have smaller accounting and finance departments, where small errors might slip through the cracks or they may be overloaded by too many tasks.

    According to Forbes, about 90% of businesses fail during their first stage; citing poor financial management as one of the top reasons. By leveraging accounting services from professional accountants, businesses can significantly increase their chances of success. Beyond simple accounting and bookkeeping services, professional accountants help to facilitate the financial operations and planning of the company to ensure a steady and healthy cash flow.

    Suppose you are looking to outsource your accounting or are currently outsourcing. In that case, you should always evaluate your potential or existing accounting company to ensure that they are the best fit for your needs, which will most likely change over time. Make sure that the existing accounting company is staffed with a team of Certified Chartered Accountants who are experienced in serving businesses of similar nature and scale. It is also crucial that they offer a dedicated account manager to service your account.

    In this article, learn how accounting services can significantly benefit your business along with why outsourcing might be a good idea.

    The benefits of professional accounting services

    From making business processes more efficient to moving your financial records online, here are the top 5 ways that accounting professionals and services can be beneficial for your business:

    01 Saves precious resources

    Managing your accounts in-house does not necessarily translate to cost savings or better efficiency. Maintaining an experienced full-time accountant, or two, could set you back thousands of dollars a month. And in the event where your accountants may later choose to advance their careers elsewhere, you would have to embark on a resource-intensive hiring process that would cost you precious time and money.

    However, should you choose to engage a professional accounting firm, you virtually eliminate these concerns and get a host of benefits in the process. You pay a monthly service fee that gives you access to the expertise of an entire team of accountants who are proficient in various areas of accounting – from tax management to bookkeeping services. You will never have to worry about varying hiring costs, induction/training programs, and employee turnover!

    02 Facilitates ease of business growth

    One key benefit of accounting, when done correctly, is its ability to clarify the status of your company’s financial health. Having a clear picture of your company’s finances helps you to make informed decisions when growing your business. It allows you to determine the feasibility of any business plan such as expansion and hiring. It prevents any counterproductive decisions that might threaten or delay your business growth by months or even years.

    Credible accounting firms can help you to paint a clear picture of your company’s cash flow and seasonality by critically analysing your receivables, collections, and financial statements. Additionally, should you engage a regional accounting firm, their advisory services and market-analyst will be made available to you. Through them, you can effectively assess your company’s performance through comprehensive financial reporting and make strategic decisions that will aid in your business success.

    03 Ensures total compliance with statutory requirements & regulations

    Time is a valuable and finite resource, so it matters what we do with it. As your company grows, more time will be needed to organise paperwork and navigate newly applicable regulatory complexities. From matters such as payroll and tax statements to annual financial statements, a single oversight could result in a compliance infringement that may lead to a hefty financial penalty.

    These risks and time costs can be mitigated through a professional accounting firm that is experienced in tax laws and procedures. Often a team of experts will be quick to flag any irregularities they spot in your financial documents and ensure that your accounting records remain immaculate. In short, their services will keep your company from any financial pitfalls and allow you to enjoy peace of mind.

    04 Enables greater savings from higher deductions

    Navigating Hong Kong’s complex regulations can pose a series of challenges that may result in an oversight of applicable tax breaks and exemptions. Ensure that you are maximising your savings and deductions by engaging professional accountants who are familiar with Hong Kong’s regulations and can adequately qualify your business for the relevant tax rebates as well as expense deductions.

    For companies that conduct business overseas, a professional team of accountants can even prevent issues such as double taxation due to their in-depth understanding of international tax treaties.

    05 Digitises your accounting records and processes

    Accounting records can be messy. A decade of records would quickly amount to hundreds of files and thousands of pages. Naturally, this makes the retrieval of data and references a nightmare. Fortunately, as we transit into a technological age, professional accounting services are offering to store your business accounting records and financial data electronically on secure platforms using advanced accounting software. These platforms often come with additional modules such as automated payroll services and claims submission, making such procedures much more efficient.

    Another benefit of using accounting services to digitise your accounting records is the ease of access it provides – regardless of location and time of day, you can retrieve records and reports in real-time from anywhere in the world!

    Discover professional accounting services in Hong Kong with BoardRoom

    BoardRoom is a regional accounting firm in Hong Kong that caters to corporations and fast-growing SMEs. Our expertise extends from tax accounting to managing statutory compliance reporting for companies across Asia-Pacific. With BoardRoom’s extensive accounting solutions and services, you can reap all the benefits by regaining precious resources and refocusing them on what matters – growing your business.

    Contact us today or learn more about our accounting solutions on our website.

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