Asia SGE | The Philanthropic Gateway: Why Global Givers Choose Hong Kong to set up charities (Section 88)

In the world of global philanthropy, a quiet but significant trend has taken root: a growing number of individuals, families, and corporations are choosing to establish their charitable foundations in Hong Kong. While cities like London, New York, and Geneva have long been traditional hubs, Hong Kong has carved out a unique and compelling niche. The decision to anchor charitable endeavours here is not accidental; it is a strategic calculation that blends favourable laws, unique geography, and a deep cultural alignment with the rising philanthropic pulse of Asia.

Key Advantages to Set Up Charities in Hong Kong

The Foundation of Advantage: The Legal and Taxation Framework to Set Up a Charity in Hong Kong

At the heart of Hong Kong’s appeal is its straightforward and donor-friendly regulatory environment. The process for a charitable institution to obtain tax-exempt status under Section 88 of the Inland Revenue Ordinance is well-established and clear. This "stamp of approval" is more than a formality—it provides donors with confidence that their contributions are not only tax-deductible but are directed toward legally recognised public causes like education, poverty relief, and community development. This clarity and efficiency stand in contrast to the more complex or restrictive processes found in other jurisdictions within the region.

Beyond charitable tax exemption, Hong Kong’s broader fiscal landscape is remarkably favourable for wealth preservation and deployment. The absence of capital gains tax, estate duty, or sales tax means that assets can be grown and channelled into philanthropic ventures with minimal fiscal friction. This creates an environment where setting up a family office or a substantial charitable trust is not burdened by the layers of taxation found in many Western countries, allowing a greater proportion of wealth to flow directly to intended causes.

The Unrivalled Bridge Between East and West

Hong Kong’s second, perhaps most distinctive, advantage is its geopolitical and cultural position. It operates as a trusted, neutral gateway between mainland China and the international community. For philanthropists from mainland China, Hong Kong offers a familiar yet globally respected platform. It provides the legal safeguards, international banking systems, and professional services necessary to conduct global philanthropy effectively, while remaining intimately connected to the needs and opportunities within the mainland.

Conversely, for international donors seeking to make an impact in Asia, Hong Kong serves as an ideal operational base. Its common law system, bilingual capabilities, and deep regional networks offer a level of access and understanding that is difficult to achieve from afar. As noted by philanthropist Ronnie Chan, the logistical and regulatory process of giving directly within mainland China can be complex, making Hong Kong’s role as a philanthropic conduit not just convenient but often essential.

An Ecosystem Built for Giving

Philanthropy does not exist in a vacuum; it thrives within a supportive ecosystem. Hong Kong has deliberately cultivated a world-class environment for wealth management that seamlessly integrates charitable giving. The government actively promotes the city as a global hub for family offices—the very entities that often steward significant philanthropic portfolios. With an estimated 2,700 single-family offices and initiatives like the Capital Investment Entrant Scheme, Hong Kong is attracting the capital and the philanthropic intent that accompanies new wealth.

This ecosystem is further strengthened by innovative platforms that connect capital with need. Initiatives like "Impact Link" (iLink) function as matchmakers, directly introducing vetted charitable projects to potential donors and family offices. This infrastructure ensures that charitable capital can be deployed effectively and that donors have access to a pipeline of credible opportunities, reducing the barrier to entry for structured giving.

Cultural Resonance and Legacy

Finally, the choice of Hong Kong resonates with the evolving character of Asian philanthropy. While Western giving has often emphasised large, endowed foundations with independent boards, Asian philanthropy frequently centres on family legacy and direct, personal involvement. Giving is seen as a core family value and a means to educate the next generation about responsibility and social contribution.

Hong Kong’s culture perfectly accommodates this model. Establishing a private charitable foundation or trust here is not just a financial transaction; it is an act of creating a lasting family institution. It becomes a vehicle for passing down values, with successive generations often steering the foundation toward new causes—from traditional poverty alleviation to contemporary support for the arts or the environment—while honouring the founder’s core intent. This alignment makes Hong Kong not just a legally sound choice, but a culturally sympathetic one for families looking to embed giving into their identity.

Conclusion

In summary, people set up charities in Hong Kong not for a single reason, but for a powerful convergence of factors. It offers the legal certainty and tax efficiency demanded by serious philanthropy, the unique positional advantage of bridging China and the world, a thriving professional ecosystem, and a cultural environment that understands the role of family and legacy in giving. As wealth continues to grow in Asia and a new generation of philanthropists seeks to make its mark, Hong Kong is poised to remain the strategic gateway for turning capital into meaningful, lasting impact.

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