China business taxation is one most common and popular issue for investors starting their business, since it is directly related with your success of business doing. Thus, it is necessity of basic knowledge of this aspect.
China Business Taxation- General Introduction
China Company Taxation includes taxation on turnover (including value added tax, consumption tax, and customs duty), taxation on profits/income (including corporate income tax for enterprises with foreign investment and foreign enterprises, and individual income tax), taxation on property and deeds (including real estate tax, contract tax and stamp duty), and taxation on natural resources (including resources tax), which are respectively in relation to different objects of taxation.
Major Taxation in Mainland China
A. Corporate Income Tax: computed on the basis of the taxable income which is equal to the total income earned by the taxpayers in a tax year less allowable deductions for the same tax year, with rate of 25%.
B. Value Added Tax: entities and individuals who sell good or provide processing, repairing, installation, transportation, mail, telecommunications, and certain modern services, in China or those who import goods into China; with rate of 3%, 6%, 11%, 17% (13% will be cancelled from July 1 of 2017).
C. Consumption Tax: levied on units and individuals engaged in the manufacturing, processing and importation of specific non-essential or luxury goods, such as tobacco, alcohol, cosmetics, jewellery and automobiles; with rates 3-5%.
D. Customs Duty: goods allowed to be imported into and exported from China and articles entering China; ad valorem tax, per unit tax or combination of both.
E. Individual Income Tax: individual incomes, raging from 3-45%.
F. Stamp Duty: taxable documents concluded or received; flat tax rate or fixed amounts per documents.
China business- accounting, bookkeeping and tax filing
1. A China company is required to file taxes after registration. If not filing taxes in time, penalties from tax bureau will be caused. Moreover, it will bring negative records to the credit of the clients.
2. China company tax filing hints: The company should file taxes monthly, quarterly and yearly according to different type of taxes. The main types of taxes for a China company include corporate income tax (25%), VAT (3%-17%).
3. Fapiao and Fapiao stamp: In China, official invoices are made by tax bureau, which is called Fapiao. The company should apply for Fapiaos from tax bureau and have a Fapiao stamp on it when issuing the Fapiao.
Tannet Services
Tax Declaration;
Tax Planning;
Annual Tax Advisory;
Application and Advisory for Tax Preferences;
Individual Income Tax Declaration for Foreigners;
Customs Duty and Goods Tax Advisory;
Consultancy of the Latest China Taxation rules and regulations.
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