How Much Share Capital Should I Register for My HK Company?

Hong Kong's 'no minimum capital' rule is a trap; registering with just HK$1 can make you look undercapitalized to banks and partners who can see your filing. The smart, standard play is to register a sensible amount like HK$10,000 to signal commitment, which you can easily increase later as you grow.

The HK$10,000 Question: Setting Your Company's Share Capital in Hong Kong

When you start the process of incorporating in Hong Kong, you’ll quickly hear the magic words: "There’s no minimum share capital!". It’s a core feature of Hong Kong’s famously flexible Companies Ordinance. It sounds fantastic. You can, in theory, register a new international company for a single Hong Kong dollar.

And that is exactly what you should not do.

This "no minimum" rule is one of the most misleading and misunderstood parts of the entire setup. For new founders, it’s the first major trap. The amount of share capital you register isn't just a legal formality; it's the very first public signal you send to the world about how serious your business is.

This is one of the first strategic decisions we guide new founders on, because it’s not a legal question, it’s a commercial one. Choosing a number "blind" can have immediate, real-world consequences, especially when you walk into a bank.

Here’s the deal: your share capital isn't a private number. It’s not a secret between you and your accountant. It's written into your company’s "Register of Members," a core statutory document that, in Hong Kong, is available for public inspection.

This means a potential bank, a new supplier, a landlord, or a high-value client can look up your company and see exactly how much you’ve capitalized it for. Registering for HK$1 is like showing up to a venture capital pitch in beach sandals. You can do it, but you're not going to be taken seriously.

Why Your Share Capital Is a Public Signal, Not a Private Fee

Let's clear up the biggest misconception first: share capital is not a fee you pay to the government or your service provider. It is the amount of money the shareholders have agreed to contribute to the company in exchange for their shares. It represents the initial "skin in the game" and the limit of a shareholder's liability.

Once you set up your company and your bank account is active, you can (and should) deposit this amount into the business account, where it becomes the company's cash on hand, ready to be used for working capital—paying for software, inventory, or marketing.

Because this amount is a public record, it's a powerful signal. Here’s what the number you choose tells the world:

• To a Bank: A bank's compliance team is all about risk assessment. When they see an application from a new company with HK$1 in capital, they see a "shell" company. It signals a lack of commitment and high risk. In our experience, this is a major contributing factor to getting a bank account application rejected. They want to see a sensible amount that reflects a real business plan.

  
  

• To a Supplier: A supplier in China who is about to extend you a 30-day credit line on a $50,000 order might check your company's registration. If they see you're only capitalized at HK$1, they will almost certainly demand 100% payment upfront.

• To a Landlord: Trying to lease even a small office? The landlord will look at your capital as a proxy for your ability to pay rent⁷.

  
  

A flimsy capital base signals a lack of seriousness. It’s a self-inflicted wound before you’ve even made your first sale.

The "HK$1 Company" Myth vs. The HK$10,000 Standard

Legally, can you incorporate with one share at HK$1? Absolutely⁸. But as a practical strategy, it's a terrible idea.

So, if not HK$1, what's the right number?

For the vast majority of our clients—SMEs, e-commerce sellers, consultants, and bootstrapped startups—the unofficial industry standard is HK$10,000 (typically issued as 10,000 shares at HK$1 each).

This number hits the sweet spot for several reasons:

1. It Looks Serious: It’s a sensible, four-figure sum (in USD, it's roughly $1,280). It signals to banks and partners that this is a real business, not a "burner" company.

2. It's Low-Risk: It's not so high that it ties up a huge amount of your personal cash. It's an amount you can realistically deposit into the company's account as its starting float.

3. It Provides Granularity: This is a crucial, forward-looking point. By issuing 10,000 shares, you give yourself flexibility. If you want to bring in a co-founder for 20% of the equity, you can easily issue them 2,000 shares. If you registered for HK$1 (one share), you'd have no way to divide the ownership without going through a new, complex share allotment process.

The Exceptions: When You Do Need More Capital

Of course, HK$10,000 isn't a magic number for everyone. The next step is to ask if your business falls into a category that demands a higher starting point.

• You're in a Regulated Industry: This is the most important exception. If you are starting a business in financial services, insurance, or certain trust services, the Companies Ordinance might not set a minimum, but your regulator absolutely will. The Securities and Futures Commission (SFC), for example, has stringent minimum paid-up capital requirements that you must meet to get your license.

  
  

• You Need Immediate, High-Value Counterparties: If your business model involves immediately signing a massive lease, taking on a large corporate client, or applying for seven-figure bank loans, you should capitalize the company to match. Aligning your capital with your immediate, known financial needs demonstrates foresight and stability.

  
  

• You Have Known Start-Up Costs: If you know for a fact you need $50,000 in working capital on day one to pay for inventory and deposits, it makes sense to register your capital at that level (or an equivalent, round HKD number).

The Compliance Trap You Must Avoid: "Treasury Shares"

As your company grows, you might want to manage its capital. You may want to buy back shares from a departing co-founder. This leads to one of the most sophisticated and misunderstood topics in Hong Kong corporate law—and a major trap for private company owners.

You may have seen headlines about the Companies (Amendment) Ordinance 2025, which introduced a flexible new "treasury share" regime. This allows a company to buy back its own shares and hold them (as "treasury shares") instead of canceling them. It can then re-sell or transfer these shares later, which is a fantastic tool for employee stock option plans or managing capital structure.

Here’s the trap: This new rule applies only to Hong Kong-listed companies.

This is a critical point of confusion. We often have to clarify to founders of private companies that this flexibility does not apply to them. For the 99.9% of startups and SMEs that are privately held, the old rule still stands: if your company buys back its own shares, those shares are treated as cancelled. You cannot hold them in "treasury" to be re-issued later. A buyback, which requires shareholder approval, is a permanent capital reduction, not a flexible treasury operation.

Your Capital Isn't Set in Stone

The number you choose on day one is not a life sentence. It’s just the starting point.

• Need to Increase Capital? It’s simple. You can issue new shares (a "further allotment") at any time. This is how you bring in new investors or inject more capital into the business. It just requires the proper board and shareholder resolutions.

  
  

• Need to Decrease Capital? This is more complex but possible. A share buyback is the most common way, but it requires shareholder approval and, as noted, the shares are cancelled.

  
  

The most important part of "incorporating in Hong Kong" isn't picking the perfect number at the start; it's the ongoing compliance. The real, non-negotiable work is diligently maintaining your company’s Register of Members and other statutory books. Every time you issue a share, transfer a share, or change an owner's details, it must be recorded. This clean, up-to-date ledger is the mark of a professionally run company and is the first thing an auditor, buyer, or regulator will want to see.

So, what's the final playbook?

1. If you're bootstrapping: Start with HK$10,000. It's the "sensible standard" that signals you're serious to banks and partners.

   
   

2. If you're regulated or have big upfront needs: Align your capital with those external requirements.

   
   

3. In all cases: Understand that your choice is public, and plan to update your corporate records meticulously as your company evolves.