Invoicing and Tax regulation in Hong Kong
Invoicing Regulation in Hong Kong
In Hong Kong, invoicing regulation is not specifically mandatory. Invoices are not regulated by a single, specific legislation but are generally governed by terms in the contract between parties and commercial practice. However, it is common practice for businesses to issue invoices. All invoices should contain important details such as date of issue, description of goods or services, price, etc, for good record keeping.
Real-time Reporting / Fiscalization in Hong Kong
There are no mandatory requirements for real-time reporting or fiscalization in Hong Kong. Businesses are free to manage their internal reporting systems and procedures as they see fit. There's no need to have each transaction or issued invoice approved by the tax authority.
E-Invoicing in Hong Kong
E-invoicing is not mandatory either, but it is growing in popularity due to its cost-effectiveness and efficiency. With the Hong Kong Monetary Authority's recent focus on promoting the use of Fintech, more businesses in Hong Kong are starting to go paperless and use electronic methods for invoicing.
VAT/GST/Tax Compliance in Hong Kong
Hong Kong does not have value-added tax (VAT) or goods and services tax (GST), there is no specific tax compliance required. Businesses must however comply with Profits Tax rate which is 16.5% for corporations and 15% for unincorporated businesses, based on their assessable profits minus allowable deductions.