- In Hong Kong, “dormant” is a formal legal status, not just “not trading”: the company passes a special resolution under Cap. 622 and delivers it to the Companies Registry.
- Dormancy pauses the big obligations: preparing and auditing financial statements, and filing the annual return (NAR1).
- It does not pause everything. The company still exists, so Business Registration renewal continues (HK$2,350 for a one-year certificate from 1 April 2026), a Profits Tax Return must still be filed if the IRD issues one, and changes to directors, the company secretary, or the registered office must still be reported.
- Dormant is not deregistration. Dormancy keeps the company alive and reversible; deregistration closes it permanently.
- Reactivating is a resolution away: pass a special resolution declaring an intention to enter an accounting transaction (or simply enter one) and deliver the resolution within 15 days.
A dormant company in Hong Kong has no relevant accounting transactions and has delivered a special resolution to the Companies Registry under section 5 of the Companies Ordinance (Cap. 622).
- Pauses: audited financial statements and the annual return (Form NAR1)
- Continues: Business Registration renewal (HK$2,350/year from 1 April 2026), Profits Tax Return if the IRD issues one, registered office, company secretary, and officer/address change filings
- How to declare: pass a special resolution (≥75% votes), deliver to the Registrar within 15 days; dormancy takes effect on delivery or a later date in the resolution
- Not the same as: deregistration, which permanently dissolves the company
A dormant company in Hong Kong is a declared legal status, not a company that has simply stopped trading. If your entity has gone quiet but you might use it again, dormancy is the middle path between carrying full compliance costs and closing the company for good.
In this guide, you’ll learn:
- What “dormant” legally means in Hong Kong
- The difference between dormant, inactive, and deregistered
- What pauses while dormant, and what still applies
- How to declare dormancy and how to reactivate
- Whether dormancy or deregistration is right for you
What is a dormant company in Hong Kong?
A dormant company in Hong Kong is one that has no relevant accounting transactions and has formally declared dormancy by special resolution under the Companies Ordinance (Cap. 622), filing that resolution with the Companies Registry. It’s a deliberate legal status, not a description of a company that has simply gone quiet.
The point of dormancy is to keep a company alive cheaply while it isn’t being used. Once the status takes effect, the heaviest annual obligations pause, but the company remains registered and can be switched back on later. It suits a founder who may use the entity again, holds it for a name or a future plan, or is between ventures.
What’s the difference between dormant, inactive, and deregistered?
These three terms describe different legal positions, and the difference decides your obligations.
|
Status |
What it means |
Compliance load |
|
Dormant |
Special resolution delivered to the Companies Registry; no relevant accounting transactions |
Audit and NAR1 paused; BR renewal and PTR-if-issued continue |
|
Inactive |
Stopped trading but hasn’t declared dormancy |
Full compliance: audit, NAR1, Profits Tax Return, BR renewal |
|
Deregistered |
Permanently dissolved |
No ongoing obligations (closure process complete) |
The common mistake is assuming an idle company is automatically “dormant” and that filings stop. They don’t, until you declare it. For the closure route, see deregistration in Hong Kong.
What counts as “no relevant accounting transactions”?
Dormancy hinges on having no accounting transactions, meaning no transaction that section 373 of Cap. 622 would require in the company’s accounting records.
In plain terms, the company isn’t trading, invoicing, paying suppliers, receiving revenue, or moving money in a way that creates a bookkeeping entry. Paying a small invoice from the company bank account is enough to end dormancy.
The Ordinance carves out a narrow exception: transactions arising from payment of a fee the company is required by an Ordinance to pay (including the fee to register the dormancy resolution itself). Beyond that, almost any real financial activity is a relevant accounting transaction. If money is still moving through the company for business purposes, it isn’t dormant.
Dormant company requirements: what pauses and what still applies?
Dormancy pauses some obligations and leaves others fully in force. This is the section founders get wrong.
What pauses while dormant:
- Audited financial statements (Part 9): the company generally doesn’t need to prepare or audit accounts for the dormant period.
- The annual return (Form NAR1) (Part 10): the requirement to deliver an annual return does not apply while the company remains dormant.
What still applies while dormant:
- Business registration renewal: renew the Business Registration Certificate every year and pay the fee (HK$2,350 for one year from 1 April 2026). Dormancy does not touch this.
- Profits Tax Return: if the Inland Revenue Department issues a Profits Tax Return, the company must still file it. The IRD accepts returns from formally dormant companies without audited accounts, but filing is still mandatory when a return is issued.
- A registered office and company secretary: the company still exists on the register.
- Officer and address changes: a dormant company must still report changes to directors, company secretaries, and the registered office to the Companies Registry. Dormancy does not pause those filings.
Dormant does not mean zero cost or zero filing. The two obligations that surprise people are Business Registration renewal (still due every year) and the Profits Tax Return (still due if the IRD issues one). Declaring dormancy pauses the audit and NAR1; it does not make the company invisible to the IRD or the Business Registration Office.
Do dormant companies need an audit?
Generally, no. A company that has properly declared dormancy is exempt from preparing and auditing financial statements for the period it remains dormant. That is the main saving dormancy offers over an ordinary inactive company.
Hong Kong otherwise has no small-company audit exemption for active companies. Formal dormancy under Cap. 622 is one of the few routes out of the annual audit. An informally “inactive” company that hasn’t declared dormancy still needs the audit.
How do I make my company dormant in Hong Kong, step by step?
Declaring dormancy is a resolution-and-filing exercise, not an application the Registry approves or refuses:
Step 1: Confirm the company is a “qualified private company”
Only a qualified private company can declare dormancy. Section 5(7) of Cap. 622 excludes:
- Authorized institutions under the Banking Ordinance
- Insurers under the Insurance Companies Ordinance
- SFC-licensed corporations carrying on regulated activity
- Associated entities of those SFC-licensed corporations
If your company falls in one of those categories, dormancy isn’t available. Ordinary private companies limited by shares are the typical qualifying type.
Step 2: Confirm there are no relevant accounting transactions
Review bank activity, invoices, payroll, and contracts. Stop business transactions before you declare dormancy. You can still pay Ordinance-mandated fees (such as the Companies Registry filing fee for the resolution itself) without breaking dormancy.
If you’re unsure whether a payment counts, get professional advice before filing. One non-exempt transaction after dormancy takes effect ends the status immediately.
Step 3: Clear outstanding compliance first
Dormancy is forward-looking. It doesn’t erase filings already due.
- File any outstanding annual return (NAR1) and pay the HK$105 fee if one is due for the current year
- Complete any audit and Profits Tax Return for the active period before dormancy takes effect
- Pay any overdue Business Registration renewal so the company is in good standing
The 42-day rule: if dormancy takes effect after the 42nd day following your incorporation anniversary, you still owe the annual return for that year. Declare earlier in the cycle to avoid one last NAR1. The same logic applies when you cease dormancy: if reactivation falls on or before day 42 after the anniversary, you owe NAR1 for that year.
Step 4: Pass the special resolution
Hold a general meeting (or use the written resolution procedure if your articles allow) and pass a special resolution approved by shareholders holding at least 75% of voting rights.
The resolution must:
- Declare that the company will become dormant as from the date of delivery to the Registrar, or a later date specified in the resolution
- Authorize the directors to deliver the resolution to the Registrar for registration
Use the Companies Registry specimens A1 or A2 as your starting template.
Step 5: Deliver the resolution to the Companies Registry
Directors must deliver a copy of the special resolution to the Registrar for registration within 15 days after it is passed (Cap. 622, section 622).
Practical filing path:
- Log in to the Companies Registry e-Services Portal
- Select registration of a special resolution
- Upload the signed resolution and pay any applicable registration fee
- Keep the filing confirmation reference
Dormancy takes effect on the date the resolution is delivered to the Registrar, or on any later date stated in the resolution.
Step 6: Handle the IRD and Business Registration position
After the Companies Registry filing:
- If the IRD has issued a Profits Tax Return, file it. Formally dormant companies may file without audited financial statements per IRD guidance; a nil return is typical when there was no activity in the basis period.
- Tell the IRD in writing that the company has declared dormancy if returns keep arriving. The IRD decides whether to keep issuing returns; dormancy at the Companies Registry doesn’t automatically stop IRD correspondence.
- Diarise Business Registration renewal each year (HK$2,350 for a one-year certificate from 1 April 2026). See the BR fee guide for renewal timing.
You can specify a future dormancy date in the resolution. If you need one last active period to finish an audit or file a final NAR1, the resolution can state dormancy starts on a later delivery date. That lets you close out the current compliance year cleanly before the pause applies.
How do I reactivate a dormant company?
Reactivation is deliberately simple because the company never went away. There are two routes back to active status.
Route A: Pass and file a special resolution
- Pass a special resolution declaring that the company intends to enter into an accounting transaction (Companies Registry specimens B1 or B2)
- Deliver the resolution to the Registrar for registration within 15 days
- Reactivation takes effect on delivery, or on the date of the first accounting transaction, whichever comes first
Route B: Enter an accounting transaction
The moment the company has a relevant accounting transaction, dormant status ends by operation of law. No resolution is required, but most companies still file the B-specimen resolution so the register reflects the change cleanly.
After reactivation: what restarts
Once active again, full obligations resume:
- Audited financial statements for the post-dormancy period
- Annual return (NAR1) for the year in which dormancy ceased, if reactivation falls on or before the 42nd day after the incorporation anniversary
- Profits Tax Return when the IRD issues one for the active period
Plan the restart so bookkeeping is in place before the first invoice or payment. Our annual return filing guide covers NAR1 deadlines once you’re active again.
Should I keep my company dormant or deregister it?
Dormancy and deregistration answer the same question from opposite directions: what do I do with a company I’m not using?
| Consideration |
Dormant |
Deregistration |
|
Company still exists? |
Yes |
No |
|
Best when |
You may use it again |
You’re finished with it |
|
Ongoing cost |
Low: secretary + registered office + BR renewal (HK$2,350/year) |
One-off closure cost, then nothing |
|
Audit / NAR1 |
Paused while dormant |
Ends once dissolved |
|
Reversible? |
Yes, by resolution or transaction |
Hard: court restoration |
Keep the company dormant if there’s a realistic chance you’ll trade again, want to protect the name, or are between projects. Deregister if you’re genuinely done.
What does it cost to keep a company dormant in Hong Kong?
Staying dormant isn’t free, but it’s far cheaper than staying active without declaring dormancy.
|
Cost item |
While dormant |
While inactive (not declared) |
|
Business Registration renewal |
HK$2,350/year (1-year cert, from 1 April 2026) |
Same |
|
Annual return (NAR1) |
Paused |
HK$105/year + filing |
|
Audit and accounts |
Paused |
Typically HK$5,000–HK$15,000+/year for SMEs |
|
Company secretary + registered office |
Still required |
Still required |
Deregistration is the opposite shape: a one-off process (IRD HK$270 for IR1263 + Companies Registry HK$420 for NDR1), then no ongoing costs. The maths is about optionality. If the value of being able to switch the company back on exceeds a modest annual minimum, dormancy wins; if not, closing is cleaner.
How Sleek keeps your dormant company compliant
A dormant company is low-maintenance, but “low” isn’t “none”. The obligations that remain are exactly the ones people forget. Sleek keeps them handled.
With Sleek, you can:
- Declare dormancy correctly: We confirm the company qualifies, prepare the special resolution, clear any outstanding filings, and deliver it to the Companies Registry within the 15-day window.
- Stay compliant for a low annual cost: Our company secretary service keeps the registered office and statutory registers in good standing and handles annual Business Registration renewal.
- Keep the IRD side clean: Our accounting and filing team manages Profits Tax Returns the IRD still issues, including nil filings for dormant periods.
- Reactivate or close when you decide: Whether you resume trading or move to closure, we file the resolution and restart (or wind down) the compliance cycle.
That means a dormant company stays genuinely dormant and in good standing, rather than drifting into penalties because a “paused” company was assumed to owe nothing.
450,000
businesses worldwide.
from 4,100+ reviews.
satisfaction rate from
16,000 surveyed clients.
FAQs about dormant companies in Hong Kong
Yes, but don’t use it for business transactions. An open account isn’t the problem; a relevant accounting transaction is. Paying rent, receiving client funds, or settling supplier invoices through the account ends dormancy. Many founders keep an account dormant in practice by leaving it at zero activity, or close it to reduce the temptation to transact.
Late delivery can invalidate the dormancy declaration timeline and leave the company in a non-compliant position for the gap period. The Companies Registry expects special resolutions within 15 days of passing. If you’ve missed the window, pass a fresh resolution and deliver immediately, and clear any audit or NAR1 obligations that accrued while the company was still treated as active.
Not if the company is formally dormant under Cap. 622. The IRD states it will accept Profits Tax Returns from dormant companies without audited financial statements. You still must file when a return is issued. An inactive company that hasn’t declared dormancy does not get that exemption.
Yes. The Companies Registry confirms that dormancy does not exempt a company from reporting changes to directors, company secretaries, or the registered office. File the usual Companies Registry forms within the standard deadlines. Dormancy pauses audit and NAR1, not corporate maintenance filings.
Only if it qualifies as a private company under Cap. 622 and isn’t in the excluded categories (banks, insurers, SFC-licensed entities). In practice, dormancy is used almost exclusively by private companies limited by shares. If you’re unsure whether your entity type qualifies, check section 5(6)–(7) of Cap. 622 before passing a resolution.
View more
Speak to us when you want the keep-or-close decision executed cleanly. If you might trade again within a few years, dormancy plus ongoing secretary support is usually cheaper than re-incorporating later. If the company has no assets, no liabilities, and no future use, deregistration is the end state. We handle both paths.
