5 Things You Must Know About Filing Your Annual Return (NAR1)

What Is An Annual Return? (NAR1 Form)

An annual return is a specifically formatted return form that details company information as of the date of completion, such as the address of the registered office, shareholder, directors, company secretary, etc¹. Companies incorporated in Hong Kong are required to file an Annual Return (NAR1 Form) to the Companies Registry on a yearly basis². Business owners must list company information in detail, in either Chinese or English, and submit the annual return together with the correct registration fee². 

What Is The Function Of Annual Returns?

Annual returns can perform various functions and offer important information and records of a company, which include any registers, indexes, agreements, memoranda, minutes or other documents, etc². Companies are also required to submit annual returns under certain circumstances, e.g., opening a company business account, reporting shares transfer³, participating in an Authorized Economic Operator (AEO) Programmes⁴, applying for Enterprise Support Schemes⁵, applying for industry-specific licenses, such as liquor licenses and club liquor licenses⁶, applying to become licensed corporations and licensed individuals under the Securities and Futures Ordinance⁷, etc. 

When Should Annual Returns Be Filed?  

Companies need to file their annual return to the Companies Registry within 42 days after the date to which the return is made up². How you define the date to which the return is made up depends on the type of the company. 

• For a private company, the date to which the return is made up, in respect of a specific year, is the anniversary of the date of the company’s incorporation in that year²  
• For a public company, the date to which the return is made up, in respect of a specific year, is the date that is 6 months after the end of its accounting reference period² 
• For a company limited by guarantee, the date to which the return is made up, in respect of a specific year, is the date that is 9 months after the end of its accounting reference period² 

If you are unsure of the due date for filing your annual return, you can conduct a calculation by entering the exact company incorporation date in the “Annual Return Filing Calculator” on the Companies Registry’s website. If you are, however, unsure about the incorporation date of your company, you can refer to the Certificate of Incorporation, or you can conduct a free search at the Electronic Search Services at the Cyber Search Centre on the Companies Registry’s website⁸. 

What Is The Annual Return Fee?

Companies are required to file their annual return together with a registration fee payment. The registration fee payment amount varies for different types of companies: 

• For private companies and companies limited by guarantee, the yearly registration fee is HK$105⁹
• For public companies, the yearly registration fee is HK$140⁹

It is worth noting that under the law, even small companies without any profit, or companies that have stopped operation but still haven’t applied for deregistration or arranged for the company to be wound up, are still required to submit the annual return fee. So, if you are planning to terminate your business, make sure the necessary procedures are being processed in a timely manner, so to avoid incurring various types of fees⁹ incurred as a result of delays in processing.

Moreover, even if a company has declared inactivity, but the effective date of the declaration falls after the 42^nd day of the company’s anniversary of incorporation in the same year, you are still required to file for an annual return for the year⁹. 

Penalty Of Late Annual Return Filing 

As of 1 May 2023, whether you are operating a private company, public company or company limited by guarantee, you are required to submit your annual return and pay the corresponding fee on time. Inadvertent late payments will result in a higher registration fee¹⁰: 

●    If the annual return is delivered more than 42 days after but within 3 months after the company's return date:  HK$ 870¹⁰
●    If the annual return is delivered more than 3 months after but within 6 months after the company's return date: HK$ 1,740¹⁰
●    If the annual return is delivered more than 6 months after but within 9 months after the company's return date:  HK$ 2,610¹⁰
●    If the annual return is delivered more than 9 months after the company's return date: HK$ 3,480¹⁰

Note: The date of a company’s return is the company’s anniversary of incorporation date each year. 

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The above information is only for your reference. For detailed information, please refer to the sources and seek professional advice if necessary. 

Article published on 19 March, 2024