HELP - lost a fortune to accounting companies!W

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  1. #1

    HELP - lost a fortune to accounting companies!W

    Hello
    I set up a business in Hong Kong (limited) as I was under the impression it was the easiest and most straightforward way to go. I live in Macau actually, but we thought we were moving to Hong Kong. My job is part time, I consult, and I consult virtually and to travel - so as I understand it, I am not liable for taxes in Hong Kong because none of the work was conducted there and nor was it done with Hong Kong clients.

    The problem is I didn't really get the business off the ground, invoiced around $20,000 Hong Kong dollars in total since April last year. The set up fees were around $2,000 US, then I changed accountants thinking I would be saving for the work needing to be done for government tax filing.

    I will admit I am out of my depth - I simply needed something to earn a bit of money on the side legally. The new firm is now saying I need to pay close to 18,000 Hong Kong dollars to file my taxes and close the business down (after paying 8000 Hong Kong to move to them - there has been so much back and forth, I should have got a firm quote from them for this before moving but understood the 8000 was going to include this further work - my fault).

    It means that the little I have earned has gone to accounting firms. I have sent three invoices all to one overseas client, invoiced around 20,000 Hong Kong only.

    Can anybody help me with:
    1) A firm who can handle this for me (filing tax papers and closing business) who doesn't want to rob me?

    2) Advice as to what I can do myself with the government to save money?

    3) What happens if I just go close the bank account down and go to the government to close the company without filing any tax papers?

    4) Now that I have moved to this other company, do they HAVE to lodge the tax papers or can they be the representative office and, should I find another firm to handle this, I just pay the other firm for filing tax and closing business? It means then I only lost 8000 moving accountants and not another 17,000 to close and file taxes.

    5) Am I better off going for a simple way forward and just paying the tax as if I had earned the money in Hong Kong (it would be less on 20 or 25,000 earned than the 17,000) by going to the government myself? Does anybody handle their own company taxes?

    Any freelancers out there or one man simple shows, I would love to hear from you how you handle it as it seems the fees I am paying is for a more sophisticated set up.

    I'm shocked with such a simple business that earned so little that this is the fees I have to pay. Surely I have alternatives?

    TIA for any advice and help you can offer!


  2. #2

    Join Date
    Apr 2009
    Location
    Hong Kong
    Posts
    6,076

    It's a straightforward thing to set up a limited company yourself, you don't need to pay someone to do it for you, and certainly not US$2,000. All the official fees and forms are on the government websites.


  3. #3

    Join Date
    Dec 2009
    Posts
    6,714

    You still need to spend money to pay taxes, file audited accounts and close the company down. No way to escape this stuff, or you could be fined by the IRD and CR.

    Why not just setup a sole proprietorship in Macau, since you are legally living there.