Record Keeping For Hong Kong Companies

Record Keeping For Hong Kong Companies

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Accounting

Bookkeeping involves recording transactions and events that occur in an accounting system. As the basis of accounting derives from the principles of accounting which in turn depend on accurate and detailed records, recordkeeping lays the foundation for accounting.

Why Should I Maintain Good Business Records?

Keeping accurate business records is paramount for the management of your business. It meets legal requirements, facilitates financial planning, monitoring, and audit readiness. Accurate and organised records help to keep track of your business income and expenses, manage the cash flow and make substantiated financial decisions. Furthermore, accurate business records aid in communication with stakeholders like investors and lenders as well as foster trust among them. The proper records management can go a long way to guarantee that your business can provide the necessary documentation to prove its financial standing during auditing.

How To Perform Record Keeping For Hong Kong Companies

Under part 51C as stipulated in the Inland Revenue Ordinance of Hong Kong, any individual (the person carrying on the trade, profession, or business established in the territory) must keep a record (in either English or Chinese) of the business income and expenses as an easy way of tax calculations.

Those records must be maintained for no less than 7 years periods of time.

If the person(s) does not obey the ordinance and is not able to offer a reasonable reason they will be charged up to $100,000.

Such records are critical to future activities of investors because they will tend to request incontrovertible proof of outcomes whenever they intend to invest.

cash registers process of entries e.g. of turnover and expenses which are closely related to each other.

What Are the Required Business Records?

  • Whenever you withdraw your allowances, income, expenses, and other receipts which are the money and properties that belonged to the creator of the trade;
  • Documents detailing the individual’s assets and liabilities regarding that occupation, business, or trade;
  • The recording of receipts and expenditures exclusively of the trade, service, or business on a day-to-day basis;
  • When this kind of work is considered trade, for instance, professor, business among other jobs.
    • The recording of every merchandise bought and sold along with the names of the traders and the cost of the buying and selling of these merchandise. The record should be simple for the Commissioner to certify that the right quantity, price, and identity of the merchants are written down as well as referencing any invoices.
    • Provides the latest inventory balances of the person on hand at the time of closing of the accounting year and all stocktakers’ records which may be used as the basis for such balance.

Hence, for what this business is engaged in such profession or trade, the provision of services entails a need for such records to be written in the most comprehensive way possible so that the Commissioner can easily grasp the facts and come to confirmations.

You can download “INFORMATION PAMPHLET: A GUIDE TO KEEPING BUSINESS RECORDS” here!

If you need business records in electronic form, you can also get a copy of the Information Pamphlet “ADMISSIBILITY OF BUSINESS RECORDS KEPT IN ELECTRONIC FORM FOR TAX PURPOSES” for reference.

How FastLane Group Can Help?

If you are just starting and running a business, doing your record-keeping by yourself might be overwhelming and time-consuming for you. It can take only a few hours for a skilled accountant to finish a monthly audit, so why not consider working with professional financial services from experts like FastLane.

Since 2013, Fastlane has been providing various services such as accounting services, audits, taxation, banking support, legal aid, corporate secretary services, and business registration to more than a thousand clients and our experts have experience working with clients in a variety of industries adjusting to every needs of our clients.

If you need help with record keeping for your businesses, contact our experienced accountants right now and we are ready to help you!