British Virgin Islands or Hong Kong: where should you start a business?
Hong Kong ranks higher in the index, 04 against 05. Which suits you depends on where the owners live, what the company is for and how it will be run.
Pillar by pillar
Doing business, side by side
Tax
Companies are generally exempt from income tax, and no withholding tax or VAT is charged. Individuals pay no income tax, although a payroll tax applies.
The first HK$2 million of profit is taxed at 8.25%, and tax is charged on a territorial source basis. There is no sales tax or VAT.
Set-up
Incorporation costs US$550 where up to 50,000 shares are authorised, and the annual fee is the same. No standard processing time is published.
Electronic incorporation costs HK$1,545, against a one-hour target met in 90% of cases. Business registration costs HK$2,350 and the annual return HK$105.
On the ground
Every company must keep a licensed registered agent in the BVI at all times, and no director needs to live there. Substance depends on the activity.
The company secretary must be resident in Hong Kong, and the company must keep a registered office there. There is no minimum capital.
Ownership
Since 1 April 2026 the register is open only to persons with a legitimate interest, for anti-money laundering purposes, at a fee of US$75.
The significant controllers register is kept by the company, not filed with the Registry, and must be produced to law enforcement on demand.
Residence
The government lists a self-employed work permit for non-Belongers who work in the territory on their own account.
The Investment as Entrepreneurs route is discretionary with no fixed minimum. The New Capital Investment Entrant Scheme requires HK$30 million.
Living and working
Currency
US dollar.
Hong Kong dollar.
Time zone
UTC-4.
UTC+8.
Personal tax
There is no income, capital gains, inheritance or wealth tax; employees can pay 8% payroll tax, and a property tax exists.
Salaries tax has a progressive top rate of 17%, or a standard rate of 15% to 16%; estate duty was abolished from 11 February 2006.
Flights
The Beef Island airport lists nonstop flights to San Juan, but no direct London, New York, Dubai or Singapore service.
About 140 airlines serve more than 220 destinations; Singapore is about 4 hrs away and London Heathrow about 12 hrs 45 mins.
Language
Chinese is official, and English can also be used as an official language by the executive, the legislature and the judiciary.
British Virgin Islands vs Hong Kong: common questions
The British Virgin Islands: Companies are generally exempt from income tax, and no withholding tax or VAT is charged. Individuals pay no income tax, although a payroll tax applies. Hong Kong: The first HK$2 million of profit is taxed at 8.25%, and tax is charged on a territorial source basis. There is no sales tax or VAT.
The British Virgin Islands: Incorporation costs US$550 where up to 50,000 shares are authorised, and the annual fee is the same. No standard processing time is published. Hong Kong: Electronic incorporation costs HK$1,545, against a one-hour target met in 90% of cases. Business registration costs HK$2,350 and the annual return HK$105.
The British Virgin Islands: Every company must keep a licensed registered agent in the BVI at all times, and no director needs to live there. Substance depends on the activity. Hong Kong: The company secretary must be resident in Hong Kong, and the company must keep a registered office there. There is no minimum capital.
The British Virgin Islands: Since 1 April 2026 the register is open only to persons with a legitimate interest, for anti-money laundering purposes, at a fee of US$75. Hong Kong: The significant controllers register is kept by the company, not filed with the Registry, and must be produced to law enforcement on demand.
The British Virgin Islands: The government lists a self-employed work permit for non-Belongers who work in the territory on their own account. Hong Kong: The Investment as Entrepreneurs route is discretionary with no fixed minimum. The New Capital Investment Entrant Scheme requires HK$30 million.
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