Dormant has a legal meaning
Under section 5 of the Companies Ordinance, a private company becomes dormant by passing a special resolution declaring that it will become dormant and delivering it to the Registrar of Companies[1]. It is dormant from the date of delivery, or a later date stated in the resolution[1]. A company with no trade that has not done this is not dormant: every private company other than one that has declared dormancy and delivered the resolution must deliver annual returns[2].
What dormancy changes
| Obligation | While dormant |
|---|---|
| Annual return (Form NAR1) | Not required (section 663) |
| Audited financial statements | Not required (section 447)[3] |
| Supporting documents with a profits tax return | The IRD accepts the return without them |
| Reporting changes of registered office, directors and company secretary | Still required |
| Business registration | Still taken out every year until the company is dissolved or deregistered |
The annual return in the switch years
In the year a company becomes dormant, it still delivers that year's annual return if dormancy starts after the 42nd day after the anniversary of incorporation[1]. In the year it stops being dormant, it delivers one if that date falls on or before the 42nd day after the anniversary[1].
When dormancy ends
A dormant company stops being dormant when it delivers a special resolution declaring that it intends to enter into an accounting transaction, or when an accounting transaction actually happens[1]. An accounting transaction is one the company must enter in its accounting records under section 373, excluding payment of a fee the company is required by an Ordinance to pay[1]. The annual return exemption stops from the date of the transaction[1], and the Registry suggests independent professional advice on whether a transaction counts[1].
Tax
For corporations with gross income, the IRD expects audited financial statements with the profits tax return, but dormant companies within the terms of the Companies Ordinance are an exception[4]. In its circular for 2025/26 returns, the IRD says it is prepared to accept profits tax returns filed by dormant companies without the supporting documents[4], which otherwise include the financial statements and a tax computation[4]. The concession is about what goes with the return, not whether to file it: a dormant company issued a profits tax return must still file it by the date on the return[4]. The IRD warns that failing to file a return, or filing late, without reasonable excuse risks action under section 80 or 82A of the Inland Revenue Ordinance[4].
Business registration still costs money
Every company incorporated in Hong Kong, whether or not in operation, is deemed to carry on business and must take out a business registration certificate annually until it is dissolved or deregistered[5]. For a certificate starting between 1 April 2026 and 31 March 2027, the 1 year fee and levy total HK$2,350[6]. The small business exemption from the fee is not available to companies[7].
Dormant or deregister?
For a company with no business at all, the Companies Registry points to deregistration under section 750 of the Companies Ordinance, or winding up[2]. Dormancy keeps the company in existence, with its business registration and change reporting, for later use.
Rules, forms and figures can change, and the official pages listed below are the authority wherever this summary differs from them.