Hong Kong Payroll Services

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Hong Kong Payroll

At Bradford Jacobs, our Employer of Records (EOR) platforms provide full-proof solutions for companies wishing to establish their presence in Hong Kong’s economy. where compliance with the local payroll laws and regulations are vital for a business’ smooth and hassle-free transition. We offer dedicated Hong Kong Payroll solutions that can be tailored to your requirements.

We make business expansion easy. We navigate the administration of the Hong Kong payroll system for you – and as part of our service, we make the returns and associated payments for income tax and social security contributions directly from our payroll system to the local tax authorities

What Hong Kong Payroll Options are available for Companies?

Businesses in Hong Kong have access to a variety of payroll options, depending on their needs:

  • Remote payroll – Businesses can operate under a single payroll system for all employees, by adding employees in Hong Kong to your parent company’s payroll. However, these employees will have to operate under different regulations, which can cause some confusion.
  • Internal payroll – You may also operate payroll out of your subsidiary, especially if you are committed to growing your company’s presence in Hong Kong. However, this does require hiring a dedicated HR staff that understands the local employment and compliance laws.
  • Hong Kong payroll processing company – If you are keen on outsourcing, working with a Hong Kong payroll processing company will help in your payroll process – but not when it comes to compliance.
  • Hong Kong payroll outsourcing – An option that solves both payroll and compliance needs – working with a company like Bradford Jacobs. We can handle both your payroll and compliance for all your employees in Hong Kong. We take the stress of administration off your shoulders so you can focus on what you do best.

Payroll regulations in Hong Kong go through frequent updates, and businesses can risk sanctions and financial penalties if they do not comply with these changes. Our payroll service requires staying up to date with these shifting demands – which includes administering returns and associated payments for wage tax and social security contributions directly from our payroll system to the tax authorities. Our role consists of:

  • Registering with the Inland Revenue Department (IRD) for a Tax Identification Number
  • Registering for a Mandatory Provident Fund (MPF) with the Social Welfare Department to pay social insurance contributions
  • Registering employees with the Inland Revenue Department (IRD)
  • Registering employees for Hong Kong ID Cards, and the valid visas/residence permits
  • Creating employment contracts for your new employees, in Chinese and English
  • Applying for employees’ special expatriation status (if applicable)
  • Calculating employees’ monthly salaries and sending them their pay slips
  • Researching for any available tax incentives
  • Submitting employees’ or employer’s wage tax returns and national insurance forms
  • Corresponding with the applicable national authorities regarding payroll changes and payments
  • Creating and submitting your company’s annual accounts, administration, and year-end statements
  • Creating payment schedules for wage tax, national insurances, and net wages
  • Ensuring proficient personal income tax returns for you and your employees

Outsourcing payroll is a popular practice for Hong Kong employers, and it is easy to see why. Outsourcing company payroll saves money and time, and guarantees paid employees, filed tax returns, and fulfilled social security obligations in full and on time. 

What is required to set up Hong Kong Payroll?

To set up Hong Kong payroll for your expansion efforts, you will need to meet specific requirements, which will depend on how you establish your presence in the country.

If you would like to set up as a subsidiary, you will need to have your subsidiary established first – but this can take some time, depending on where you incorporate as well as the entity type you choose (to see more about establishing a subsidiary, click here).

To start processing payroll in Hong Kong, you will need to register with Inland Revenue Department (IRD) and the Social Welfare Department to set up your own Mandatory Provident Fund (MPF).

You will also need to apply for a local bank account.

Registering with the relevant authorities will take at least 5 working days, whilst registration with the bank will take any time between a few days to a few weeks, depending on the documentation required and the bank that you choose.

The Inland Revenue Department also requires the employer to submit these forms to set up payroll:

  • Form IR566: For reporting all new hires, to be submitted within three months of employing the new individual.
  • Form IR56F: For reporting employee terminations, which must be filed within one month of the employee’s last day of work.
  • Form IR56G: For reporting an employee leaving Hong Kong for a specific length of time.