Running a coffee shop in Hong Kong: A guide for foreigners (2026)

Updated on January 29

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Hong Kong is one of Asia's most vibrant F&B markets. With a population of over 7,5 million and a strong recovery in international tourism after the pandemic, the market is seeing dozens of new cafes opening every month, from international brands like Blue Bottle Coffee (USA) to Luckin Coffee (China).

Foreigners can absolutely open coffee shops in Hong Kong. Hong Kong allows 100% foreign ownership, does not require a local partner, applies a profit tax of only 8,25%, and waives all F&B license fees until October 2026.

In this article, GLA guides you through the entire process of opening a coffee shop in Hong Kong: legal requirements, licensing procedures, tax structure, actual costs, and location selection strategies.

1. Why is Hong Kong an attractive market for the coffee business?

Before delving into the process details, businesses need to understand why Hong Kong attracts so many international F&B investors:

The coffee market is growing in the direction of improving quality: According to estimates StrategyHelix (2025)The Hong Kong coffee market is projected to reach US$1 billion by 2031, driven by growth in the specialty coffee segment and upscale café experiences rather than mass-market products. Hong Kong consumers are increasingly willing to spend more on single-origin, cold brew, and special brewing experiences.
100% foreign-owned, no local partner required: Hong Kong is one of the few Asian markets that allows foreign individuals and businesses to own all of the capital without having to share shares with any local individuals or entities. The investor retains full control of the business and profit distribution, as stipulated by regulations. Companies Ordinance (Cap. 622).
The tax system is particularly favorable: Hong Kong applies a profit tax of only 8,25% on the first 2 million HKD of profits, with no VAT, no dividend tax, and no capital gains tax. This is a significant competitive advantage compared to most other Asian markets.
Diverse and stable customer base: With a population of over 7,5 million, a large international expat community, a concentrated office workforce in major financial districts, and a strong recovery in international tourism after the pandemic, Hong Kong offers a diverse customer base that few other Asian markets can match. This diversity ensures that the restaurant's revenue is not dependent on a single customer group.
Government support policies are directly reducing initial costs: According to the HKSAR Government's Policy Address 2025All fees for issuing and renewing food business licenses, including the General Restaurant Licence and Light Refreshment Restaurant Licence, will be waived for one year, expected to support over 60.000 businesses. This is a limited-time policy that businesses planning to open should take advantage of.
The most favorable business environment in Asia: Hong Kong is not only a good consumer market but also a highly regarded international business environment:
- Top 5 globally in competitiveness (IMD World Competitiveness Center (2025)).
- Top 3 globally for ease of doing businessDoing Business 2020).
- Top in international free trade (Economic Freedom of the World Report 2025).

2. Are foreigners allowed to open coffee shops in Hong Kong?

Foreigners are fully permitted to open coffee shops in Hong Kong. Hong Kong is one of the few Asian markets that allows foreign investment. 100% ownership of the businessThis does not limit the nationality or place of residence of the founder. This is clearly stipulated in Companies Ordinance (Cap. 622) and is Companies Registry HKSAR consistent implementation.

Can foreigners open a coffee shop in Hong Kong?

2.1 Establishing a company in Hong Kong: A prerequisite for opening a coffee shop.

Before applying for a food and beverage (F&B) business license, you need to establish a legal entity in Hong Kong. In other words, foreign investors cannot directly apply for a coffee shop license in their own name as an individual.

The most popular business type is the Private Limited Company. This model is suitable for most foreign investors due to its simple establishment procedures, limited liability, and ease of opening bank accounts, signing lease agreements, and obtaining necessary business licenses.

The business potential of coffee shops in Hong Kong.

So, Incorporating a company in Hong Kong This is always the first and mandatory step before implementing any procedures for opening a coffee shop.

Condition	Requirement	Feasibility
Establish a Private Limited company.	Required before applying for any F&B license.	It's not difficult; it can be completed in 7–10 days.
100% foreign owned	Permitted under Hong Kong law	No legal barriers
Company Secretary (Hong Kong company)	Obligatory	Must be a Hong Kong resident or a legally licensed TCSP
Registered address in Hong Kong	Obligatory	GLA assists in providing a registered company address in Hong Kong.
Hong Kong Visa if directly in charge	Only if directly managed in Hong Kong.	Early planning is necessary, and the process typically takes 4–8 weeks.

2.2 Minimum requirements for establishing a company in Hong Kong

According to the regulations of Companies Ordinance (Cap. 622), a Private Limited company in Hong Kong must meet the following conditions:

Requirement	Details	Note for foreigners
Director	At least one director, who can be an individual or a legal entity.	No Hong Kong residency or citizenship is required.
Company Secretary	One person is required.	Must be a Hong Kong resident or a legally licensed TCSP (Trust or Company Service Provider)
Shareholders	At least 1 shareholder	It can be a foreign individual or legal entity, with no limit on ownership percentage.
Registered address	Must have an address in Hong Kong.	GLA provides a registered business address.

2.3 Do I need a visa to operate a coffee shop in Hong Kong?

Visa requirements depend on how the business plans to operate the coffee shop in Hong Kong. There are two common scenarios:

Situation 1: Owning a business but managing it remotely.

Businesses can own a coffee shop and receive profits from Hong Kong without residing there. Business owners are not required to apply for a visa if they do not work directly in Hong Kong.

In this case, the business needs to have an on-site operational management team and meet the business compliance requirements stipulated by Hong Kong regulations.

Situation 2: Directly managing and operating in Hong Kong

3. Coffee shop business license in Hong Kong

This is the step that many GLA clients report as the most time-consuming, not because the procedure is overly complex in terms of content, but because the process involves many different government agencies and requires very thorough preparation of documents from the outset.

Therefore, understanding the sequence and requirements of each step will help the Hong Kong company avoid unnecessary and costly delays.

3.1 Main Licensing Authority: Who is FEHD and what does it regulate?

The central authority in the entire F&B licensing process in Hong Kong is Food and Environmental Hygiene Department (FEHD)This is equivalent to the agency responsible for food safety and environmental hygiene.

FEHD has the authority to license and supervise all food businesses in Hong Kong, including restaurants, cafes, bakeries, food factories, and other F&B businesses. All cafe-related licenses must go through FEHD before they become effective.

However, FEHD is not the only agency involved in the process. For a coffee shop to be fully licensed, the application must go through the review and approval of four government agencies simultaneously.

3.2 Four government agencies are involved in the licensing process for coffee shops in Hong Kong.

This is a key difference compared to many other markets: in Hong Kong, FEHD will coordinate with relevant authorities to inspect a business's premises according to industry-specific standards before issuing a formal license.

Organ	Role in the licensing process	No matter what
Food and Environmental Hygiene Department (FEHD)	The agency responsible for issuing F&B licenses.	Food hygiene, food safety, food handling procedures, overall sanitary conditions
Buildings Department	Structural safety inspection	Structural safety, ventilation, drainage, and water supply systems; compliance with planning regulations.
Fire Services Department	Fire safety inspection	Emergency exits, fire alarm systems, sprinklers, fire extinguishers, fire safety training for staff.
Environmental Protection Department	Environmental impact assessment	Waste management, noise control, and wastewater treatment from the kitchen area.

All four agencies must complete their inspections and raise no objections before FEHD can proceed with the application. If any of them require the business to modify the premises or add technical systems, the entire process will be prolonged. This is why choosing the right location from the outset is far more important than simply looking at store rental prices in Hong Kong.

3.3 Two types of licenses most suitable for the coffee shop model in Hong Kong

Before submitting the application, the Hong Kong company needs to clearly identify the type of F&B license that suits its cafe concept. Below are the two most common types for cafes, according to FEHD classification:

Type of license	Which model is suitable?	Outstanding characteristics
General Restaurant License	The cafe has seating areas, serves a variety of snacks and drinks, and aims to become a "destination cafe".	Most common, encompassing almost all types of F&B businesses; requiring higher standards of facilities and technical systems.
Light Refreshment Restaurant License	This is a small, takeaway-only shop serving snacks and non-alcoholic drinks.	Simpler requirements, lower costs, suitable for coffee kiosk or small shop models.

Special case: If a Hong Kong coffee shop plans to serve beer, wine, or cocktails, the owner will need to apply for an additional license. Liquor License TU Liquor Licensing Board After obtaining the basic F&B license, this is a separate process and needs to be planned in advance if serving alcoholic beverages is part of your concept.

4. The 6-Step Process for Opening a Coffee Shop in Hong Kong

To legally open a coffee shop in Hong Kong, businesses need to follow these steps sequentially. Proper preparation from the start will help shorten the time it takes to obtain an F&B business license, minimize the cost of modifying the premises, and avoid repeated requests for additional documents from the authorities.

Step 1: Establish the company and complete business registration.

Before applying for any F&B licenses, investors need to establish a company in Hong Kong and complete the business registration process. The business will then be granted:

Certificate of Incorporation;
Business Registration Certificate.

These are two fundamental legal documents required in the application for a coffee shop business license in Hong Kong.

GLA provides consulting services on suitable company structures, handles all Hong Kong company incorporation procedures, provides registered business addresses, company secretaries, and support. Open a Hong Kong business bank account..

Step 2: Search for and assess the location.

This is a step many investors overlook and pay dearly for later. According to the experience of GLA's consultants, some clients have signed lease agreements before checking the legal conditions, leading to the inability to obtain permits or requiring costly renovations.

Before signing a lease agreement, the company needs to evaluate the following factors:

Does the Government Lease permit the use of the premises for food and beverage operations?
Does the Town Planning Board's land-use plan support a coffee shop or restaurant business model?
Does the premises meet the requirements for installing separate ventilation systems for the kitchen, restrooms, and customer service area?
Do the electrical, water supply, and drainage systems meet the operational needs of the industrial kitchen and beverage dispensing equipment?

Choosing the right location from the start can determine the speed of obtaining permits and the long-term viability of the store.

Step 3: Prepare and submit the F&B license application to FEHD.

After securing a suitable location, the business proceeds to prepare the necessary documents to apply for a food and beverage business license with the Food and Environmental Hygiene Department (FEHD).

The file typically includes:

Certificate of Incorporation
Business Registration Certificate
Detailed floor plan
Information about the Food Hygiene Manager
Lease agreement or documentation proving the right to use the premises.

FEHD uses floor plans to evaluate the layout of kitchens, beverage preparation areas, customer service areas, restrooms, emergency exits, and other technical requirements. An unsatisfactory drawing may result in multiple revision requests for the project.

The offer is currently valid: From November 1, 2025 to October 31, 2026, the HKSAR Government All fees are waived. Submit applications for new and renewed General Restaurant Licenses and Light Refreshment Restaurant Licenses. Businesses planning to open should take advantage of this timeframe.

Step 4: On-site inspection, obtaining permits, and officially commencing operations.

After receiving the application, FEHD and relevant agencies will conduct an on-site inspection of the business location, including food hygiene conditions, fire safety systems, building structure, and ventilation, water supply, and drainage systems. If adjustments are required, the business must complete them before the application is approved.

After fulfilling all requirements, the business will be granted a license to officially operate. In some cases, FEHD may issue a Provisional Restaurant Licence before issuing a Full Restaurant Licence.

Step 5: Open a business bank account / checking account

This is a step many foreign restaurant owners overlook in their initial plans, leading to a reactive approach right before opening day. Businesses have two options:

Traditional banks (HSBC, Hang Seng, Standard Chartered): Suitable if the business already has established operations in Hong Kong and a complete set of documentation. The advantage is the established reputation with local suppliers and partners.
International payment accounts (Airwallex and similar): Suitable for newly established businesses or owners who operate remotely. Offers greater flexibility in procedures, faster processing times, and better support for multi-currency transactions.

GLA provides consulting services to help select suitable solutions and connects traditional and digital corporate banking accounts for F&B businesses in Hong Kong.

Step 6: Post-operation procedures

Once the store is operational, the business needs to maintain continuous compliance with the following groups of obligations:

Taxes and Accounting: Businesses are required to submit an annual Profits Tax Return to the Inland Revenue Department (IRD), prepare financial statements, and undergo audits as required by Companies Ordinance.
Human Resources and MPF: Ensure that all employees' MPF (Employee Financial Fair Pay) is paid on time (before the 10th of the following month), maintain employee records, and comply with the Employment Ordinance.
Licenses and hygiene: Food and beverage licenses need to be renewed periodically as required by FEHD. Businesses must maintain food hygiene standards and be prepared for unannounced inspections.
Business administration: Maintain the company's secretarial services, renew the Business Registration Certificate annually, and update any changes to the company structure.

GLA provides long-term support to businesses through accounting services, tax filing, Hong Kong company secretarial services, license renewals, and legal compliance consulting in Hong Kong.

5. Taxes when operating a coffee shop in Hong Kong

Hong Kong has one of the lowest and simplest tax systems in Asia. Coffee shops in Hong Kong only have to pay Profits Tax; there is no VAT, no dividend tax, and no capital gains tax.

5.1 Profits Tax: The main tax that F&B businesses need to understand.

In Hong Kong, the tax levied on businesses is called... Profits Tax (Profit tax), not Corporate Income Tax as in many other countries. This is the only tax that a coffee shop operating in Hong Kong has to pay directly on its business profits.

The tax authority is the Hong Kong Revenue Department.Inland Revenue Department ("IRD")), and Profits Tax only applies to profits generated in Hong Kong.

Hong Kong applies a two-tiered profits tax system as follows:

Taxable profit	(company) tax rate
first 2.000.000 HKD	8,25 %
Profits exceeding HKD 2.000.000	16,5 %

Here's a real-world example:

If a coffee shop in Hong Kong makes a taxable profit HKD 1.500.000 over a fiscal year. The entire profit falls within the first HKD 2 million threshold, so the Profits Tax payable is:

HKD 1.500.000 x 8,25% = HKD 123.750

For comparison, if the profit margin is the same in some Southeast Asian countries with a corporate tax rate of 20% to 25%, the tax payable would range from HKD 300.000 to HKD 375.000. This difference is very significant for the operating cash flow in the initial phase of the restaurant.

5.2 Hong Kong taxes that do NOT apply

This is what gives Hong Kong a distinct competitive advantage over most other Asian and international markets. When running a coffee shop in Hong Kong, businesses... Not Pay the following taxes:

Type of tax	Applicable in Hong Kong	Comparison with other markets
VAT / GST (Value Added Tax)	Do not apply	Vietnam: 10%; Singapore: 9%; Australia: 10%
Dividend Tax	Do not apply	Many countries impose rates ranging from 5% to 30%.
Capital Gains Tax	Do not apply	Common in many developed countries
Withholding Tax on Interest Expense	Do not apply	Many markets apply a rate of 10% to 15%.
Foreign income tax	Not applicable (territorial principle)	Most countries levy global taxes.

For every cup of coffee you sell in Hong Kong No additional VAT will be charged.The listed price is the price customers pay; there are no hidden surcharges. This is a major difference compared to operating under the same model in Singapore, Vietnam, or Australia, where VAT/GST taxes significantly increase costs and complicate accounting.

5.3 Mandatory Pension Fund (MPF): Coffee Shop Owner's Obligation to Employees

Mandatory Provident Fund (MPF) It is a mandatory pension fund system under Hong Kong law, applicable to all businesses with employees. This is a mandatory expense that every coffee shop owner needs to factor into their operating budget before opening.

How MPF works:

Subject	Mandatory contribution rate	Maximum amount per month
Business owner (Employer)	5% of employee's salary	HKD 1.500/employee
Employee	5% of personal income	HKD 1.500/month
Minimum income threshold for calculating MPF.	7.100 HKD/month	Below this amount, employees don't need to pay, but the owner still has to pay their share.
The maximum income threshold for calculating MPF.	30.000 HKD/month	This portion of salary exceeding the threshold is not included in the MPF calculation.

Practical implications for a coffee shop: If your restaurant has 6 employees with an average salary of HKD 18.000/month each, the business owner's MPF cost would be:

6 employees x HKD 900 (5% x HKD 18.000)/month = HKD 5.400/month

This is a fixed monthly expense that needs to be factored into the operating budget from the outset, alongside employee salaries.

6. Choosing a location for a coffee shop in Hong Kong

To open a successful coffee shop in Hong Kong, you need to choose an area that suits your target customer base. Central areas like Central and Tsim Sha Tsui have high foot traffic, are close to office buildings, and attract many tourists. However, rental costs there are very high, potentially reaching HKD 500,000 per month.

Conversely, areas like Mong Kok, Tai Po, or Yau Ma Tei offer more reasonable rental costs, ranging from HKD 50,000–150,000 per month, making them suitable for affordable, budget-friendly coffee shops. Additionally, areas like Wan Chai or Kowloon Tong have large expatriate communities, creating favorable conditions for internationally-styled cafes.

List of potential areas to open a coffee shop:

Central: suitable for a high-end cafe, close to offices.
Tsim Sha Tsui: attracts tourists, has many visitors.
Mong Kok: a vibrant area with reasonable rental costs.
Wan Chai: has a large expatriate community, leading to a demand for high-quality coffee.
Tai Po: low rent, close to the university, suitable for small businesses.

Choosing the right location depends on the business's direction, target customer base, and long-term rental budget. If a business is entering the Hong Kong market for the first time, GLA recommends starting in areas with moderate rental costs such as Sheung Wan, Wan Chai, or Kwun Tong to test the concept before expanding to higher-cost locations.

7. How does GLA support you in running a coffee shop business in Hong Kong?

Running a coffee shop in Hong Kong is not just about finding a location and building a brand. Businesses also need to complete legal procedures, tax and accounting processes, obtain licenses, and establish bank accounts to ensure smooth operation from the start.

GLA partnered with the Hong Kong company throughout the entire process:

Advisory suitable business models in Hong Kong.
Establishing a Hong Kong company for foreign investors..
Set up your financial system in compliance with HFRS with our Business registration address , and Hong Kong company secretarial services.
Support open a corporate bank account or an international payment account.
Consulting services Required permits in Hong Kong For food and beverage businesses.
Perform Accounting services, financial reporting, and periodic tax filing for a Hong Kong company..
Assisting with local recruitment procedures and work visa applications for foreign business owners or managers.
Consulting services for expanding business operations into mainland China and the Asian region.

With experience assisting international businesses in establishing and operating companies in Hong Kong, GLA helps you save time, minimize legal risks, and focus on developing your business from the very beginning.

8. Frequently Asked Questions about Running a Coffee Shop in Hong Kong

1. Are foreigners allowed to open coffee shops in Hong Kong?

Yes. Hong Kong allows 100% foreign ownership, with no residency or local partner requirements. The first mandatory step is to establish a Private Limited company in Hong Kong before proceeding with any further procedures.

GLA provides full support for the entire company formation process in Hong Kong, from document preparation to obtaining the Certificate of Incorporation.

2. What permits are needed to open a coffee shop in Hong Kong?

3. What are the taxes involved in the coffee business in Hong Kong?

4. Do I need a visa to own a coffee shop in Hong Kong?

Highlights

Foreigners can absolutely open a coffee shop in Hong Kong with 100% foreign capital. No local partner is required. The first mandatory step is to establish a Private Limited company, after which you can proceed to apply for an F&B license from FEHD.
Hong Kong has a tax system that is particularly favorable to the F&B business.The profit tax is only 8,25% for profits up to HKD 2 million, with no VAT and no dividend tax. This is a significant competitive advantage compared to most other Asian markets.
The period from 2025 to 2026 is relatively favorable for entering the market.Rental prices have fallen by an average of 46% from their 2018 peak, F&B license fees are being completely waived until October 2026, and demand for specialty coffee continues to grow in the market.
Location and concept are two key factors determining success. This is a coffee shop market in Hong Kong. While there's no shortage of coffee shops, there's always room for brands with a clear positioning and a truly distinctive experience.

This information and guidance is for general informational purposes only and is not intended as specific advice on accounting, tax, legal, or other professional matters. Legal regulations may change and application may vary depending on the specific circumstances; therefore, GLA recommends that individuals and businesses consult with professionals before making any decisions. GLA is not responsible for any damages arising from the use of this content without appropriate professional advice.

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