Run Google & Facebook Ads VAT-Free with a Hong Kong company

For businesses running Facebook and Google ads, paying VAT correctly according to regulations is a matter of concern for many businesses.

Value added tax (VAT) rates for Facebook and Google advertising activities in many countries range from 5% or more depending on the advertising position on Facebook (Meta).

Taking advantage of tax incentives in countries with low tax policies for Facebook and Google advertising is the choice of many businesses.

Company formation in Hong Kong is one of the choices of many Facebook and Google advertising businesses because of attractive tax incentives and benefits to help develop foreign businesses here.

1. What are Facebook and Google's advertising tax policies in different countries?

When businesses buy ads on Facebook (Meta), Google, or other digital platforms, value-added tax (VAT) or goods and services tax (GST) will be applied depending on the country the ad account is registered in. This policy comes from each country's domestic tax regulations, to ensure international platforms comply with local tax laws.

There are two important factors that affect the calculation of advertising tax:

• Country of registration of advertising/business account: The legal address of the enterprise will determine the applicable tax rate.
• Ad delivery country: In some cases, the market to which advertising is directed can affect tax policy.

Below is a comparison table of online advertising tax policies in some popular countries and territories:

Understanding advertising tax policies in each country not only helps businesses optimize their marketing budgets but also ensures compliance with international laws and avoids long-term tax risks.

To refer to all types of VAT in countries around the world, businesses visit Exclusive VAT comparison tool to make investment decisions for the Business. 

2. Why does Google, Facebook not charge VAT for Hong Kong company running online ads on their platform?

Right now, Facebook and Google have different rules for collecting VAT or GST, depending on the country where the person or business runs ads.

Currently, Hong Kong does not apply value added tax (VAT). In other words, Hong Kong's VAT is 0%.

Because of VAT rules for Facebook and Google ads, Hong Kong is one of the countries where businesses don’t have to pay VAT for running ads. This tax advantage has made many individuals and businesses choose to set up companies in Hong Kong.

Besides Hong Kong with its 0% tax policy, countries like Singapore and the USA also offer great benefits, such as strong branding and friendly policies for foreign companies.

To help you choose the best country for your business model, GLA offers expert advice and support.

3. Attractive benefits for businesses running Facebook and Google ads when opening a company in Hong Kong

Hong Kong is a popular choice for many foreign businesses because it offers many attractive benefits, such as:

• No VAT (0%), so your company won’t be charged VAT when paying for Facebook or Google ads. 
• No corporate tax on profits made outside Hong Kong.
• Many payment options: traditional bank accounts, online banks, and global payment gateways like PayPal or Stripe.
• A strategic location in the Asia-Pacific region.
• Easy and convenient business setup.
• One of the freest economies in the world.
• Support available for setting up your company in Hong Kong.
• Transparent legal environment.

Practical benefits for Vietnamese businesses:  Using a Hong Kong legal entity to deploy international advertising brings many practical benefits to your business in the fields of E-commerce, App, SaaS, Agency:

• Save advertising costs: Because VAT is not applied, businesses can immediately reduce their advertising budget by about 10%, especially when implementing large campaigns.
• Transparent international advertising account: Easy to manage, reduce the risk of account lockout or campaign interruption.
• Increase credibility when trading: Invoicing issued by a Hong Kong company helps businesses enhance their professional image, creating trust with international customers and partners.
• Optimize global payments: Conveniently connects to payment gateways such as Stripe, PayPal, Wise, helping international money flow easily and transparently.

4. Hong Kong company formation process for businesses running Facebook and Google ads

5. Open a bank account for a company established in Hong Kong to run Facebook and Google ads

After opening your company in Hong Kong, you must open a business bank account to pay google ads invoice, facebook ads incoice, and also receive payment from Google, Facebook. You have these options below to open: 

• Open a bank account online in Hong Kong. 
• Open a bank account online in financial center countries such as: Singapore, Mỹ, etc.
• Open a traditional bank account in Hong Kong or countries like: Singapore, USA, etc.

Opening a traditional bank account in places like Hong Kong, Singapore, or the US is quite hard now. The process is long, complicated, and banks have strict requirements. Approval takes time, and the chance of success is lower compared to opening a digital bank account.

Digital bank accounts in financial hubs like Singapore or the US are becoming more popular. The setup is simple, fast, and online. Costs are lower, and the success rate is higher than with traditional banks.

If you're opening a Hong Kong company to run Facebook or Google ads, contact GLA. Our banking experts will help you choose the right type of account for your business.

6. How does GLA support you in setting up a Hong Kong company to run Facebook and Google Ads? 

Establishing a company in Hong Kong is a popular solution for Vietnamese businesses that want to run ads on Facebook and Google Ads. The reason is: Hong Kong has a transparent legal environment, easy registration, and is recognized by international platforms.

• Quickly establish a Hong Kong company: GLA supports a full package of legal procedures and licenses, helping you have a reputable legal entity to open an international advertising account.
• Provide a valid business address: Meet Facebook/Google requirements when verifying business information.
• Support opening corporate bank account in Hong Kong / easy cross-border advertising fee payment gateway.
• Prepare business verification documents: Consult and provide complete documents for quick approval by Facebook/Google Ads.
• Consulting on optimizing company structure: Suitable for online business model, reducing risks when running international advertising.
• Annual legal compliance & maintenance: GLA accompanies your Hong Kong company to always operate transparently, without affecting your Ads account.
• Bilingual English – Vietnamese support: Ensures you can easily work with both international platforms and Hong Kong regulators.

7. FAQs when businesses open a company in Hong Kong to run Facebook and Google ads?

Highlights

• Incorporate a Hong Kong company to run Facebook and Google ads means you won’t pay VAT and can enjoy tax benefits in Hong Kong.
• To start a Hong Kong company, you must register with the Hong Kong Company Registry.
• Each year, the company must renew its Hong Kong incorporation certificate.