Our collection of resources based on what we have learned on the ground
Resources
Q&A
How are social insurance inspections carried out in China?
- October 2012
- Members Access
Social insurance inspections—and the penalties for being found out of compliance—are one major reason to ensure full accuracy in mandatory benefit contributions. Social insurance audit/inspection practices vary by city. In Shanghai, for e...
Q&A
How many different mandatory benefit types are there under Chinese law?
- October 2012
- Free Access
The different types of mandatory benefit can be categorised as follows: Medical Unemployment Housing Fund* (Foreigners are not required to pay housing fund depending on the city), Work-Related Injury Pension Maternity
Q&A
What is a foreign enterprise services company in China?
- October 2012
- Free Access
Many foreign-invested companies and representative offices in China have a contract in place with a foreign enterprise services company (FESCO) for labor dispatch, payroll and/or additional services for Chinese Employees.
Q&A
What is 'hukou'?
- October 2012
- Free Access
A hukou stipulates an employee’s home city/country and can either be a rural hukou or an urban hukou, with the social insurance system applying only the latter.
Q&A
What services are provided by foreign enterprise services company besides payrol...
- October 2012
- Free Access
Some FESCOs carry out other services such as executive search work (headhunting) on behalf of their clients, which could create a conflict of interest between payroll clients (who supply confidential personal and salary information) and headhunting c...
Q&A
What does the Labor Contract Law stipulate about workers dispatched from foreign...
- October 2012
- Free Access
In the past, this directive has often been ignored and foreign enterprise services companies have been used to hire a wide variety of Chinese workers upon the client’s request. However, recent draft legislation regarding the obligation of emplo...
Q&A
What are the advantages and disadvantages of foreign enterprise services compani...
- October 2012
- Free Access
The advantages of using foreign enterprise services companies are: lower risk than direct hiring hiring assistance during process of incorporation mandatory benefit payments in other cities The disadvantages thereof are: conflict of intere...
Q&A
What are the different requirements for claiming treaty benefits in China?
- September 2012
- Members Access
The requirements for claiming treaty benefits in china differ on the base of the type of income: benefits from passive income must receive approval (which takes 20-50 days and is valid for three calendar years), while benefits from active income shou...
Q&A
What are the four categories that summarize the legal framework in regards to th...
- September 2012
- Free Access
The development of double taxation agreements for China investment by summarizing the legal framework are in four categories: Anti-avoidance foundations Qualifying as beneficial owner Claiming treaty benefits Reporting offshore transactions
Q&A
How do China?s anti-avoidance foundations affect taxes?
- September 2012
- Free Access
China’s general anti-avoidance rules (GAAR) were first introduced under the 2008 Corporate Income Tax (CIT) Law which provides that, where an enterprise’s taxable income is reduced due to its implementation of “arrangements that do ...
Q&A
What is the most common difficulty for Hong Kong clients when applying to avail ...
- September 2012
- Members Access
The most common difficulty for our clients in Hong Kong when applying to avail of treaty benefits under DTAs between China and other countries is to obtain the tax resident certificate for their Hong Kong entity, especially when the Hong Kong en...
Q&A
Have the Double Taxation Avoidance Agreements (DTA) become more stringent and sp...
- September 2012
- Free Access
Beginning in 2010, stronger, more specific regulations began to come into effect, and companies began to have to apply for relief under DTAs; for example, in order to qualify for DTA relief from withholding tax on dividends, interest and royalties, t...
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