Questions related to Deregistration of a Hong Kong Company

Q1. Why a Notice of No Objection (NNO) is required?
A1. With effect from 11 November 1999, a private company which has ceased its operation and is solvent may apply to the Companies Registry under s. 291AA of the Companies Ordinance (Cap. 32) for deregistration. However, the application must be accompanied by a NNO issued by IRD under s. 88B of the Inland Revenue Ordinance (Cap. 112).

Q2. Who can make the request for a NNO?
A2. (1) A director
(2) A member or nominated person of the company, with copy of authorisation letter signed by a director of the company.
(3) If the nominated person is a practising professional, e.g. accountancy/secretarial or solicitor firm, submission of evidence of authorisation is not required unless requested by IRD.

Q3. What documents should be submitted when making the application?
A3. (1) A properly-completed Application Form (IR1263); and
(2) A crossed cheque, draft or cashier order in the amount of $350 for the application fee.

Your application will be rejected if:
(1) the Application Form is not properly-completed; or
(2) your cheque is not properly-drawn or is dishonoured.

Q4. When shall I expect to receive the result of the application?
A4. Normally, a Notice of No Objection, or a Notice of Objection if there are unsettled tax matters or liabilities, will be issued within 25 working days from the date of receiving the application or the fee, whichever is the later.

Q5. What are the conditions to be considered for the issue of a NNO?
A4. A NNO will be issued if:
(1) the company has never commenced operation, or has already ceased business;
(2) the company will not start/resume business in the future;
(3) the company has disposed of all trading stock, landed property and securities, if any;
(4) the company has no outstanding tax liabilities (including those owed by the company in the capacity of an agent of an overseas business) which include Profits Tax, Property Tax, Stamp Duty, Business Registration fee, fines and penalties in connection therewith, costs of tax recovery including court fees, cost of execution, bailiff's expenses, guard fee and judgement interests;
(5) the company has no outstanding obligations under the Inland Revenue Ordinance. These include submission of returns which have been issued by the IRD, liability to notify the CIR in writing that the company is chargeable to tax for any year of assessment in which a return has not been received;
(6) there are no unanswered enquiries from IRD;
(7) there are no unsettled objections or appeals in respect of assessments already raised.

Q6. If a defunct company applies for deregistration, can it submit unaudited accounts to supports its Profits Tax Return?
A6. No. The company has to submit audited accounts to support its Profits Tax Return unless it is a dormant company within the terms of the Companies Ordinance, i.e. the company has no accounting transaction during the accounting period.

Q7. If a defunct company applies for deregistration, does it need to keep accounting records? If yes, how long does it keep?
A7. Under s. 51C of the Inland Revenue Ordinance, every person carrying on a trade, profession or business in Hong Kong must keep sufficient records of his income and expenditure (either in English or in Chinese) to enable his assessable profits to be readily ascertained. Business records must be retained for at least seven years after the completion of the transactions to which they relate. This does not apply to a corporation which has been dissolved.

For a defunct company which applies for deregistration, it still needs to comply with the requirements of s. 51C of the Inland Revenue Ordinance before it is deregistered under the Companies Ordinance.

However, under s. 292(3) of the Companies Ordinance a person who was a director of a company immediately before its dissolution must ensure that all the books and papers of the company are kept for not less than 5 years after the dissolution.