Our collection of resources based on what we have learned on the ground
Resources
Q&A
What are the restraints for a company?s entity in China to pay dividends directl...
- July 2014
- Free Access
There are several ways of repatriating cash from China, the most obvious being for a company’s entity in China to pay dividends directly to its foreign parent company. However, this is subject to certain prerequisites – only profits th...
Q&A
Are service fees paid to overseas-related parties deductible for or exempt from ...
- July 2014
- Free Access
Service fees paid to overseas related parties are deductible for CIT purposes provided they are directly related to the foreign-invested enterprise’s (FIE) business operations, charged at normal market rates, and all applicable taxes have be...
Q&A
Do companies in China need to provide a tax clearance certificate when remitting...
- July 2014
- Free Access
To ease foreign exchange controls and simplify the administration of foreign exchange, the State Administration of Foreign Exchange (SAFE) and State Administration of Taxation (SAT) jointly issued the Announcement on Issues Concerning Tax Filings for...
Q&A
What do royalty fees entail in China?
- July 2014
- Free Access
Royalties are fees paid in relation to the use of intellectual property, such as trademarks, patents, copyrights, and proprietary technology. Royalties are deductible for corporate income tax (CIT) purposes, provided they are directly related to the ...
Q&A
What factors would hamper the determination of being a beneficial owner in China...
- July 2014
- Free Access
In determining whether the non-resident company is indeed the beneficial owner of the royalties, the tax authorities will apply a “substance over form” principle and conduct analysis based on the actual circumstances of the case. In gener...
Q&A
Can foreign enterprises in China remit undistributed profits in the form of loan...
- July 2014
- Free Access
A wholly foreign-owned enterprise (WFOE) may remit undistributed profits to a foreign related company with which it has an equity relationship by extending a loan. The WFOE’s interest income will be subject to 25 percent corporate income tax (C...
Q&A
When are service fees deemed to be royalty fees in China?
- July 2014
- Free Access
In accordance with Circular No. 507 [2009], if, in the course of the transfer or licensing of technical know-how, a licensor assigns personnel to support and guide the licensee in using the technical know-how and charges fees for these services, then...
Q&A
Can a company repatriate all their profits made in China?
- July 2014
- Free Access
Only profit that has undergone annual audit can be repatriated. Annual audit for tax compliance conducted by the local tax authority is usually completed around June or July every year. The audit allows the State Administration of Taxation (SAT) t...
Q&A
When is profit allowed to be repatriated in China?
- July 2014
- Free Access
Profit is allowed to be repatriated in China if an entity complies with all of the following points: The wholly foreign-owned enterprise’s (WFOE) registered capital has been injected within the time limits as set out in the Article of Associ...
Q&A
Why are double taxation avoidance agreements (DTAs) beneficial to companies repa...
- July 2014
- Free Access
Companies repatriating dividends need to be aware of whether or not there is a DTA in place between China and their home country, which can reduce the 10 percent withholding tax on dividends to 5-8 percent. This is not something that tax authorities ...
podcast
Podcast The Anatomy of Corporate Hijacking presented by Chet Scheltema
- July 2014
- Free Access
Chet Scheltema,International Business Advisory Manager, introduces the concept of corporate hijacking and how foreign business can prevent this from happening to their operations in China.
podcast
Introduction to General VAT Taxpayer Status presented by Chet Scheltema
- July 2014
- Free Access
Chet Scheltema, International Business Advisory Manager, talks about the general VAT taxpayer status and how businesses can effectively manage the VAT systems.
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