CHINA EXTENDS PREFERENTIAL VAT POLICY FOR SMALL-SCALE TAXPAYERS UNTIL 31 DECEMBER 2020

28 May 2020 | Tags: Corporate Finance, VAT

On 7 May 2020 China’s State Administration of Taxation (SAT) and Ministry of Finance (MOF) announced that the preferential policy implemented to support small-scale taxpayers will be extended until 31 December 2020. On 28 February 2020, China’s SAT and MOF implemented a preferential policy reducing VAT rates payable by small-scale taxpayers to support micro- and small sized companies during the COVID-19 outbreak. ... READ MORE


THE DISTINCTION BETWEEN SMALL-SCALE TAXPAYER AND GENERAL TAXPAYER STATUS IN CHINA AND EFFECTS ON HANDLING VAT PAYMENTS

28 May 2020 | Tags: Corporate Finance, VAT

In China distinction between taxpayers is made based on their annual revenue. Companies with an annual revenue not exceeding RMB 5 million are considered small-scale taxpayers and when an annual revenue over RMB 5 million is realized, companies are considered to have obtained general taxpayer status. In this article the main differences between small-scale taxpayer and general taxpayer status is discussed ... READ MORE


HOW TO VERIFY WHETHER YOUR ORGANIZATION IS ELIGIBLE FOR DTA BENEFITS

16 April 2020 | Foreign Investment, DTA

Double Taxation Agreements (DTAs) aim to prevent income from being taxed by two or more states through providing tax credits, exemptions, and/or reduced tax rates for specific income types such as interests, royalties, and dividends. DTAs further provide certainty by defining the taxation right of each jurisdiction on various types of income arising from cross-border economic activities. ... READ MORE


TAXATION OF OUTBOUND DIVIDEND PAYMENTS FROM CHINA

16 April 2020 | Corporate Finance, Dividend, Tax

The most well-known and commonly applied profit repatriation method out of China is via dividend payments. Dividend payments are subject to Withholding Tax and Corporate Income Tax. The bilateral agreement between China and the contracting country or non-state tax jurisdictions, might affect the overall tax burden of both the China-based subsidiary company and the foreign parent company. ... READ MORE


NEW MEASURES FOR TAX CREDIT RESTORATION FOR CORPORATE TAXPAYERS IMPLEMENTED

15 April 2020 | Corporate Finance, Tax, Credit

On 7 November 2019 China’s State Administration of Taxation released the Announcement on Tax Credit Rehabilitation Related Matters, which provide eligible China-based corporate taxpayers per 1 January 2020 with the possibility to correct tax irregularities and apply for restoration of tax credits at the competent tax authorities. In this article the eligibility requirements which ... READ MORE


DEFERRED PAYMENT OF WITHHOLDING TAXES ON DISTRIBUTABLE PROFITS REINVESTED BY FOREIGN INVESTORS FOR DIRECT INVESTMENT

3 April 2020 | Finance, Regulatory, FDI, Tax

China’s fiscal year runs from 1 January to 31 December. All Chinese – domestic and foreign invested – resident enterprises are subject to annual audit which is to be performed between 1 January and 30 April. Upon completion of the audit, the subsequent mandatory filing requirements and payment of taxes, distributable profits can be repatriated abroad or reinvested in China ... READ MORE


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