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Audit and Tax Filing Services

We provide a cost effective and a smooth audit engagement services.

Looking for Audit and tax filing services in Hong Kong?
Look no further.


 

FastLane CPA Limited, an affiliate of FastLane Group, is a licensed CPA HK audit firm with extensive experience in providing statutory audit reports and tax filing services in Hong Kong (Reg. No: S0615)

We have a team of well-experienced and qualified auditors to ensure that your company complies with the Hong Kong regulatory requirements.

We aim for accuracy, speed, and professionalism in performing our duties as your preferred audit and assurance firm in Hong Kong

Our audit and tax filing services include: 

 

Statutory Audit report

An audit can be intimidating for companies of all sizes. We can help to assure compliance with applicable reporting standards and identification of internal control issues.

Profits Tax Computation

Having an accurate tax computation is critical to the company. Partnering with a professional can help you keep your computation compliant and hassle-free.

Xero Based Audit

You don’t need to move paper around with our Xero audit engagement. You will experience a seamless and time-efficient audit engagement using Xero

Offshore Tax Claims

When your income is generated outside Hong Kong, you may be exempted from Hong Kong profit tax. FastLane Professional is delighted to assist you to claim your offshore tax exemptions.

 

Hong Kong Tax Filing (Profits Tax, Employer’s Return, Salaries Tax)

Tax filing is a complicated and time-consuming process for both individuals and businesses.
It involves a lot of paper works and reporting requirements that must be complied with.
Delegate the process to professionals and free yourself for more critical business activities.

 

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We offer a unique delivery model with technology that enables us to provide an unrivalled service which has successfully supported more than five hundred companies.

Hong Kong Tax System at a Glance  

Hong Kong is renowned for its simple tax regime, making it one of the most business-friendly jurisdictions in the world. Hong Kong utilizes a territorial system of taxation whereby only income derived from, and incurred in Hong Kong is subject to Hong Kong Profits Tax. In addition, Hong Kong does not impose a tax on capital gains, dividends, VAT, or estate tax and its low Profits Tax Rate continues to attract global businesses of all sizes. 

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Profits Tax / Corporate Tax


  • The two-tiered profits tax regime
  • Corporations will be taxed at a rate of 8.25% on their first HK$2 million of assessable profits
  • Assessable profits will be taxed at 16.5% 
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Income Tax / Salaries Tax


  • Progressive tax rate system from 2 to 17% on net chargeable income
  • The Maximum effective income tax rate is 15%
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Property Tax 


  • The flat rate at 15% on the net assessable value of lands or buildings

1. Profits Tax 


Hong Kong utilizes a two-tiered profits tax regime for both corporations and unincorporated businesses. Corporations will be taxed at a rate of 8.25% on their first HK$2 million of assessable profits, unincorporated businesses will be taxed at a rate of 7.5%. All assessable profits of corporations and unincorporated businesses exceeding their initial HK$2m of assessable profits will be taxed at Hong Kong’s standard rate of 16.5% (15% for unincorporated businesses). 

Although not employed by a corporation, individuals such as entrepreneurs who are self-employed will be subjectable to the Hong Kong Profits Tax rate in accordance with the scheme stated above.

Such an advantageous tax system provides extensive support for businesses, especially start-ups and SME’s. Given that such businesses are able to retain a larger share of their profits, Hong Kong’s environment is perfectly suited to entrepreneurs and their ventures.

2. Income Tax


Hong Kong Income Tax is of a similar rate to the Profits Tax rate. Salaries tax is applicable to individuals employed by corporations at a rate of 17%, however, the maximum effective income tax rate is 15%. Please visit our blog for the details on salaries tax calculation.

3. Property Tax


Hong Kong Property tax is levied on the owners of land and buildings situated in Hong Kong at a rate of 15%. The assessable income subjectable to Property Tax is levied on the rental income (net of any irrecoverable rent) received in the year of assessment. It should be noted that deductions and allowances are permitted for repairs and outgoings equal to 20% of the rental income received, after deducting rates paid by the owner. For corporations whose main source of revenue is rental income received from property, their assessable income will be subject to profits tax instead. Such companies will not be subject to property tax.

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FastLane Clients See Result Like These…

 

We have worked with FastLane now for several years, and see them as a vital part of our team. They are extremely diligent and responsive and provide truly world-class service in all their secretarial services, accounting, and auditing. I have already recommended them to several other companies who have also been delighted with their service. I strongly recommend them for any business looking to take the accounting load off your company, allowing you to focus on your customers and your business. Thanks to Tony, Michelle, and the FastLane team!

Nigel Hawthorn, Managing Director
Treadfox International Limited


“Highly recommended! A great decision to switch to FastLane for my company audit because we use Xero for our accounting management and FastLane is the best Xero partner in Kong Kong and they know Xero inside out. What I need to do is to provide them read-only Xero access and they can go through the records and complete the audit without really bothering me. I got additional Xero tips which I would never be able to figure out. A real bonus!”

Miles Davison, Storeganise

 


“It is such a delightful experience working with FastLane. You can really tell their team cares to get you informed and get things done. They will guide you through the whole process to make auditing and tax filing smoother. You do not need to worry too much about missing the tax deadline since a timetable is prepared and followed up upon.”

Kin Lun Tsang,

Miracle Life


Handling traditional bookkeeping and audit for many years. I cannot believe using Xero can make the process so much easier and faster. I no longer need to bring all physical documents around and have useful accounting reports anytime anywhere when logging into Xero. Thanks FastLane.”

Frankie Yiu, Central Japanese Club Limited

FAQs

1. What is an audit and why is it necessary?


Statutory audit reports are examinations of a company’s financial reports, conducted by an independent party to comply with the disclosure requirements set out in the Hong Kong Company Ordinance and tax obligations outlined in the Inland Revenue Ordinance.

Under this Ordinance, all Hong Kong incorporated companies are statutorily required to audit their financial reports every year. Financial reports will include a balance sheet, an income statement, a statement of changes in equity, and a cash flow statement.

 

2. What are the Hong Kong standards on auditing?


All Hong Kong incorporated companies are statutorily required by the Companies Ordinance to audit their financial statements every year.

These financial statements are essentially accounting documents prepared by a Certified Public Accountant (CPA) on behalf of a business, to provide financial accountability to the company’s stakeholders. For private companies, financial statements are not required to be filed on public records.

For corporate entities, financial statements are required and must be prepared, to comply with the disclosure requirements set out in the Hong Kong Companies Ordinance, Hong Kong’s Financial Reporting Standards, and the Rules of The Stock Exchange of Hong Kong Limited for listed companies.

In Hong Kong, only a Certified Public Accountant (CPA) is qualified to conduct an audit.

 

3. What is the process of preparing a statutory audit?


The Hong Kong audit process is as follows:

  • The company prepares the financial accounts along with the supporting documents for the CPA’s further handling.
  • The auditor reviews and understands the activities of the company as well as the nature of the company, both of which could affect the audit.
  • The auditor identifies and evaluates significant transactions in the financial statement.
  • The auditor tests the financial statements and spots uncertainties and errors that could influence the financial accounts.
  • The auditor reviews the financial statements and its supporting documents to ensure that the report on transactions is accurate.
  • The auditor made an opinion report to reflect the accuracy and fair representation of the company’s financial statements.
  • The auditor makes a report from the audit and opinion on the financial statements.
  • The director of the company signs the audit report and the supporting documents.
  • The auditor receives the signed audit report and creates the tax computation form and sends it back to the IRD along with the Profits Tax Return.

The content and depth of the audit documents depend on the identified risks of material misstatement, the judgment required in performing the audit, and the significance of the audit evidence obtained by the auditor.

For more tips on preparing a stationary audit, check it out here!

 

4. What does one need to prepare for the audit?


For the CPA to perform a proper audit, correct management accounts are needed. To prepare for your audit, it is best practice to have a list of required documents prepared.

  • Audited financial statements of subsidiary companies
  • Copy of the original Profit Tax Return received from the IRD
  • All applicable financial statements for the assessed period
  • All sales/service agreements, employment contracts, tenancy agreements for the assessed period
  • All purchase invoices for the assessed period
  • Receipt for all expenses for the assessed period
  • Bank statements (The auditor might ask you to sign a confirmation form which will be sent to the bank to obtain the bank balance)
  • All sales invoices with the corresponding receipt for the assessed period
  • Copy of any special licenses, such as an SFC License or Property Agent License (if any)
  • Copy of the company’s registration documents:
    • Updated business registration certificate
    • Incorporation certificate
    • Articles of association
    • Annual Return

Learn more about what you need to prepare for an audit and get the audit preparation checklist here!

 

5. Can I handle the statutory audit myself?


The purpose of conducting a statutory audit report in Hong Kong is to obtain a true and accurate representation of the financial statements of a company, without any internal bias. In Hong Kong, the financial statements, profits, and taxes payable to the government are usually verified and audited by a third party.

As the financial statements and tax returns of a company must be compiled without bias, companies cannot conduct the audit themselves. Audits must be completed by a neutral third party.

However, accounting can be done internally. Typically, a company can use their internal staff or professional accounting firm to conduct bookkeeping activities. If an audit is conducted, auditors will rely on the internal records kept by a company’s accounting staff.

 

6. When do I need to submit my first Profits Tax Return?


The IRD will generally issue the first Profits Tax Return for newly incorporated businesses 18 months after the date of their commencement. However, the IRD may issue a Provisional Profits Tax Return at an earlier date where circumstances warrant.

Upon receipt of a Profits Tax Return, the taxpayer should submit the return along with any required supplementary forms within 1 month from the date of issue. The compliance date of submission for each Profits Tax Return will be specified on page 1 of the Profits Tax Return.

 

7. Can I extend the filing deadline for the profit tax return?


It is possible to obtain an extension to your profits tax returns. To promote electronic filing, small corporations and small partnership businesses can apply for a further extension of 2 weeks after the normal submission date, on the condition that they submit their Profits Tax Returns through the internet. Businesses may also apply for an extension under the Block Extension Scheme. It is recommended to consult the IRD’s official website with the particular extended due dates of Profits Tax Returns.

 

8. What are the consequences if I do not file the profit tax return on time?


To the extent that a taxpayer fails to submit their tax return on time, they may be required to pay a penalty or may even face prosecution. A further consequence is that the taxpayer in question may be liable to pay an increased tax. The maximum penalty for non-compliance is HK$10,000 plus treble the amount of tax undercharged.  

In situations where taxes have been underpaid, the IRD may impose an additional 5% of the taxable amount as a penalty.

 

9. How can a professional audit firm help?


Professional auditing and assurance firms in Hong Kong like FastLane CPA HK can greatly improve the audit and taxation process of a company. With our team of qualified professionals, we can assist clients in meeting their statutory audit report by reviewing and ensuring the validity and legality of their financial records, and by advising on how to be more tax-efficient and compliant.

With the daily stress associated with running a business, thinking about accounting and auditing is often the last thing you want to do. If you’ve been thinking of outsourcing services for your accounting and bookkeeping, our staff is happy to assist.
Outsourcing your accounting and bookkeeping tasks will allow you to get back to the part of your company that you love. Rather than devoting your efforts to paperwork and administrative tasks, you’ll free up substantial time to focus on the core aspects of what your business does!

Our audit firm, FastLane CPA HK is well-versed in all facets of compliance, auditing and assurance, accounting, and more. We will help you manage your compliance obligations to keep your risk levels down. With FastLane CPA HK, you can expect a personalized approach and top-level support for all your business accounting and taxation needs.

 

What can FastLane Do for You?



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