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Regulations for the Implementation of the Individual Income Tax Law of the People’s Republic of China Article 1 These Regulations are formulated in accordance with the Individual Income Tax law of the People’s Republic of China (hereinafter referred to as the “Individual Income Tax Law”). Article 2 For the Purposes of Article 1 of the Individual Income Tax Law, the term have domicile in China means reside in the territory of the PRC by reason of their household registration, family or economic interests; the term income gained within and outside China means income derived from sources inside and outside the territory of the PRC respectively. Article 3 Unless otherwise provided by the finance and tax authorities under the State Council, the following income, whether the place of payment is within the territory of the PRC or not, shall be the income derived from sources inside the PRC: (1) Income from […]

Registration of Resident Representative Office (Permanent Representative Office) in Shanghai, China 1. Features of Permanent Representative Offices 1.1 Legal Status of a Permanent Representative Office The Permanent Representative Office (also known as Resident Representative Office) is a non-legal entity operating representing its parent company foreign companies registered outside China, including those registered in Hong Kong, Macau and Taiwan). A Permanent representative office is not allowed to engage itself in business activities, issue invoices on its own, remitting outward, signing sales or purchase contracts, or receiving income from services performed but may act as a liaison and promotion office for its parent company. 1.2 Name of a Permanent Representative Office The name of the Permanent Representative Office should be in the form of “Name of the Foreign Enterprise + Name of the City + Representative Office (or Office)”. For example, USA New York LLC Shanghai Representative Office. 1.3 Business Address (Registered […]

1. Features of Permanent Representative Offices 1.1 Legal Status of a Permanent Representative Office The Permanent Representative Office (also known as Resident Representative Office) is a non-legal entity operating representing its parent company foreign companies registered outside China, including those registered in Hong Kong, Macau and Taiwan). A Permanent representative office is not allowed to engage itself in business activities, issue invoices on its own, remitting outward, signing sales or purchase contracts, or receiving income from services performed but may act as a liaison and promotion office for its parent company. 1.2 Name of a Permanent Representative Office The name of the Permanent Representative Office should be in the form of ¡§Name of the Foreign Enterprise + Beijing + Representative Office (or Office) ¡¨. For example, USA New York LLC Beijing Representative Office. 1.3 Business Address (Registered Office) Before submitting the documents for application for registration to the Beijing Administration […]

The establishment of foreign investment enterprises consists of three phases: (1) approval of the project proposal, feasibility study report, Joint Venture Contract and Articles of Association; (2) registration with the AIC; and (3) post-establishment procedures. Post-establishment Registration After an FIE is registered with the AIC and obtains the Business License or the Enterprise Legal Person Business License, the FIE should handle the following procedures; (1) Enterprise Code Each enterprise is assigned a fixed enterprise code, which is unique nationwide. The technology supervision authorities are in charge of the enterprise code registration. After the business license of an FIE is issued, the FIE should apply for enterprise code registration as soon as possible. All the other registrations and procedures, such as tax registration and opening bank accounts, must use the enterprise code certificate of the FIE. For an FIE possessing legal person status, the technology supervision bureau will issue an Enterprise […]

Registration of Changes-Extension of Residency Term In accordance with Regulations on the Registration and Administration of Permanent Representative Office of Foreign Enterprises, the foreign enterprise shall apply with the registration authority for the alternation of registration within 60 days before the expiration of the residency term in case the representative office intends to continue to engage in business activities after the expiration of residency term. The following materials are required for the purpose of the extension of residency term for a RO in Beijing, China: 1. Legalized incorporation documents of the headquarters of the Beijing RO; 2. Legalized banker’s reference letter of the headquarters of the Beijing RO; 3. Application form for change of registration of resident representative office of foreign enterprise; 4. Registration Certificate and representative card of the representative (s); 5. Company chop, financial chop and name chapter of the Beijing RO; 6. Bank Account Opening Permit and […]

According to the Decision on Amending the Law of the People’s Republic of China on Individual Income Tax reviewed and adopted at the 18th Session of the Standing Committee of the 10th National People’s Congress on October 27, 2005, the taxpayer “with individual income exceeding the amount stipulated by the State Council” shall declare taxes by himself/herself, widening the scope of self-declaration by taxpayers. Thereafter, the State Council stipulated that “the individual income exceeding the amount stipulated by the State Council” means “annual income of over RMB120,000” by amending the Implementing Rules of the Law on Individual Income Tax and authorized the State Administration of Taxation to formulate specific management measures. According to the provisions above and the principle of “providing convenience to taxpayers, regulating high incomes, facilitating tax collection and administration, and stressing on key management issues”, the State Administration of Taxation formulated and issued the Self-Declaration Rules Concerning […]

State Administration of Taxation on the Issuance of the Circular of “Provisional Measures for Tax Collection and Administration of Representative Offices of Foreign Enterprises” State Tax Rule [2010] No. 18 Date printed :2010-02-20 The state tax authorities and regional tax authorities of all provinces, autonomous regions, municipalities and cities under separate state programs: In order to regulate the tax collection and administration of representative offices of foreign enterprises, please follow and implement the “Provisional Measures for Tax Collection and Administration of Representative Offices of Foreign Enterprises” issued to you by the State Administration of Taxation. Please reflect to the State Administration of Taxation (International Tax Division) for any problems encountered during implementation. State Administration of Taxation 20 February 2010 Provisional Measures for Tax Collection and Administration of Representative Offices of Foreign Enterprises 1. In order to regulate the tax collection and administration of representative offices of foreign enterprises, these provisional […]

Pre-approval by: Tourism Market Management Department of Shanghai Municipal Tourism Administrative Commission Time frame for pre-approval: Verification of the application shall be completed by Shanghai Municipal Tourism Administrative Commission within 30 working days after acceptance. If approved, it shall be submitted to the National Tourism Administration of P.R.C. for approval. Qualifications of the Applicant: The applicant shall be an enterprise engaged in travel business in Taiwan, Hong Kong and Macao and overseas countries and meet the following conditions: 1. It has been legally registered in its own country (region) and the registered scope of business includes traveling business; 2. It has good credit rating and formal membership in the trade association of travel agencies or similar organization in its own country (region); 3. It has engaged in travel business of sending tourists from its own country (region) to China for more than two years and the number of tourists it […]

1. Preferential policies for software and integrate circuits industries a. From June 24, 2000 till the end of 2010, General taxpayers selling software developed by themselves shall pay VAT at the rate of 17%. However, if the actual VAT is more than 3%, the surplus amount of VAT shall be refunded at the same time of payment. Integrate Circuits designing enterprises are regarded as software enterprises and enjoy the same policies. The refund shall not be regarded as taxable income and enterprise income tax shall not be pre-raised, provided that such refund is used to re-invest in research and development of software products and enlargement of production. b. From June 24, 2000 till the end of 2010, General taxpayers selling integrate circuits (including mono-crystalline silicone) produced by themselves shall pay VAT at the rate of 17%. However, if the actual VAT is more than 6%, the surplus amount of VAT […]

Presently, foreign invested enterprises in China will be able to enjoy the following preferential treatments for taxation: A. Income Tax Preferential Policies for Foreign Invested enterprises 1. Reduction of tax rate a. The income tax of the following foreign invested enterprises and projects shall be levied to the rate of 15%: (1) Foreign-invested enterprises located in special economic zones, foreign enterprises who establish institutes, sites in special economic zones for production and operation, and manufacturing foreign invested enterprises located in economic and technological development zones. (2) Starting from January 1, 1999, manufacturing foreign invested enterprises investing in infrastructure projects of energy, transportation, ports and docks, with subject to approval by the State General Administration of Taxation, without restriction of locations. (3) Foreign-invested enterprises located in the old sections of the cities which are called coastal open areas and economic and technological development zones, and operating projects of the category of […]