How do I make my Hong Kong company dormant to avoid the audit?
Check the company qualifies, pass a special resolution declaring it will become dormant from a stated date, and have the directors deliver that resolution to the Companies Registrar. Dormancy takes effect from the delivery date or the later date in the resolution.
Steps under s.5 of the Companies Ordinance
- Confirm eligibility. It must be a private company that is not a bank, insurer, SFC-licensed corporation, associated entity of one, approved MPF trustee, a company with such a subsidiary, or a company that was one of these in the previous five years.
- Make sure there are no accounting transactions to come. A dormant company that records a transaction (other than paying a legally required fee) loses dormancy.
- Pass a special resolution declaring that the company will become dormant from (a) the date of delivery to the Registrar or (b) a later date named in it, and authorising the directors to deliver it. A special resolution needs at least 75% of the votes cast.
- Deliver the resolution to the Registrar for registration.
About forms There is no numbered form for dormancy. The Companies Registry's FAQ says the company delivers the special resolution itself and publishes two specimen resolutions, A1 and A2, for declaring dormancy. Form NDR1 is the deregistration application, a different process (see the deregistration answer).
Before filing, tell the other regulators Dormancy under the Companies Ordinance does not cancel business registration or tax filing automatically. IRD says that a company that has delivered the s.5 resolution is exempt from audited accounts, and accepts the profits tax return without the supporting documents. It does not treat the return duty as cancelled; see the tax answers.
Take advice if there are unpaid liabilities, since directors and certain members become personally liable if the company later transacts.
Legal basis
- Companies Ordinance (Cap. 622), s.5
- Companies Ordinance (Cap. 622), s.447
Sources
Applies to 2026 · Last reviewed 29 October 2026
General information for business owners, not legal, tax or professional advice. Rules change, so check the sources or ask a licensed professional before you act.
Related questions
- Does a dormant Hong Kong company still have to file a profits tax return?Dormancy under the Companies Ordinance relieves the company from audited accounts, and IRD accepts a profits tax return from it without the audited statements. It does not by itself cancel the duty to file a return when IRD issues one.
- Does every Hong Kong limited company need an audit?Yes. Every Hong Kong company must have an auditor for each financial year and its financial statements audited, whatever its size or whether it trades. The only company that escapes is a qualifying private company that has validly become dormant under s.5 and s.447 of the Companies Ordinance.
- Do I still need an audit if my company had no revenue or no business activity?Yes, unless the company has formally become dormant. Having no sales does not make a company dormant in law. If it had any expenses, bank charges or other recorded transactions, the audit duty continues for that year.
- My company is loss-making. Do I still need to audit it?Yes. Profit or loss has no bearing on the audit requirement. A loss-making company is audited every year, and the auditor will also look closely at going concern.
- What is the dormant company audit exemption in Hong Kong?A qualifying private company that has become dormant under s.5 of the Companies Ordinance does not need to appoint an auditor or have its accounts audited while it stays dormant. The exemption is in s.447, not in s.448, which deals with false statements in reports.