Why You Should Set Up a Family Office in Hong Kong

Hong Kong stands out as a prime destination for establishing a family office due to its strategic location, business-friendly environment, and robust infrastructure

As global wealth continues to rise, family offices are becoming an increasingly popular way for the ultra-wealthy to manage their financial assets and plan for the future. Hong Kong stands out as a prime destination for establishing a family office due to its strategic location, business-friendly environment, and robust financial infrastructure. Here are the key reasons why setting up a family office in Hong Kong is a smart move.

Supportive Regulatory Framework

One of the unique advantages of Hong Kong is the absence of a specific licensing regime for setting up a family office. The regulatory framework is activity-based and does not consider whether an entity is called a “family office” or whether its clients are families. This flexibility allows family offices to operate more efficiently without the need for complex regulatory approvals.

Strategic Location and Connectivity

Hong Kong’s geographical position as a gateway to mainland China and the broader Asia-Pacific region offers unparalleled strategic advantages. The city’s sophisticated transport infrastructure connects it seamlessly with China and the rest of Asia, making it a central hub for both global and regional business activities. This connectivity is particularly beneficial for those looking to invest in China’s burgeoning economy through the Greater Bay Area, an 11-city cluster planned for increased economic integration.

Strong Government Support and Incentives

Hong Kong’s tax system is one of its most significant draws. The city offers numerous tax concessions specifically designed for family offices that meet certain thresholds. For example, eligible family offices managing family-owned investment holding vehicles can benefit from newly introduced tax incentives. Additionally, Hong Kong has no sales tax, value-added tax, capital gains tax, or withholding tax on dividends and interests, making it an attractive jurisdiction for investors.

The Hong Kong government has introduced a range of measures to attract family offices, including tax breaks and a revamped investment-migration scheme. This proactive approach has led to significant growth, with over 2700 single-family offices established by the end of 2023. The government aims to attract even more family offices by 2025, reinforcing Hong Kong’s position as a premier destination for wealth management.

Robust Financial Hub

Hong Kong’s status as a leading financial centre is another compelling reason to set up a family office here. The city hosts nearly 80 of the world’s 100 largest banks and 70 of the top 100 global asset managers. According to Deloitte’s International Wealth Management Centre Rankings, Hong Kong has consistently ranked among the top three in overall competitiveness since 2013. The presence of a deep talent pool, extensive professional services, and a robust banking ecosystem makes Hong Kong an ideal location for managing complex family wealth.

How Alpadis Can Assist

Alpadis Group can be your entrusted partner in advising you on how to build a future-ready family office tailored to your needs, missions, and strategy. We provide comprehensive solutions, including succession and estate planning, trusteeship and corporate administration, risk management and insurance services, and compliance and regulatory services, which are crucial functions of a family office. Whether the family office operates as an internal unit managing trust assets or is established as a separate legal entity owned by a trustee, Alpadis Group ensures compliance with Hong Kong’s regulatory environment.

Establishing a family office in Hong Kong is a strategic decision that offers numerous advantages, from its favourable tax regime and business-friendly environment to its strategic location and robust financial infrastructure. With Alpadis Group as your partner, you can confidently navigate the process and secure the efficient and effective management of your family wealth for generations to come.