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Seminar in Shenyang: Financial Management for German SME in China

Companies with certain scales need to establish separate financial departments and hire full-time cashiers and accountants. But, is this the total solution of all requirements of the financial management? However, due to the strong requirements on the duties of a single cashier or accountant they usually have a lack of comprehensive understanding for the financial situation of the whole company. That's normal. An accountant or cashier is, of course, not a tax adviser in the same person, so it is quite normal that a company needs more information about the updated financial and tax regulations to avoid that they feel quite helpless in the face of tax or financial problems during the daily business operations.

Interpretation on the Promulgated Administrative Measures for Tax Convention Treatment for Non-resident Taxpayers

With a view to promote the reform of administrative examination and approval for tax affairs and optimize the administration of tax convention treatment for non-resident taxpayers, the State Administration of Taxation (SAT) recently promulgated the Administrative Measures for Tax Convention Treatment for Non-resident Taxpayers, hereinafter referred to as, "Circular No.60". How does this impact on non-resident tax payers?

Implementing the Sino-EU Mutual Recognition Arrangement for Authorized Economic Operators

From 1st November 2015, China and the EU Customs decided to officially implement the “AEO” mutual recognitions. What is “AEO”? What benefits “AEO” can bring to enterprises?

Should Royalties be charged into dutiable value of import goods or not?

The question whether royalty should be charged into dutiable value of import goods or not still remains the top priority to overcome for China Customs Authority (CCA). Their interpretations on nature criteria, charge base and apportionment methods for the royalties also differ from multinational corporations, so a reasonable planning and effective communications in advance with CCA is of upmost importance to investors when setting up their business in China.

“Examination and approval for confirmation of encouraged foreign-invested enterprise projects” is cancelled

The China State Council had announced that effective from May 01, 2015, examination and approval for confirmation of encouraged foreign investment projects in China (Letter of Confirmation) is no longer required in order to speed up application process of duty-free imported equipment. How do we should response to this change？ This “Letter of confirmation” has long been an important part in the process course of duty free equipment. What impacts would this change bring to us?

MOF Seeks Comments on Administrative Measures for Accounting Files

The Ministry of Finance ("MOF") has recently released the revised Administrative Measures for Accounting Files (Draft for Comment) (the "Draft') for public comment by June 27, 2015.

GAC Clarifies Matters Concerning Reduction/Exemption of Surcharges for Late Payment of Duties

The General Administration of Customs ("GAC") has issued the Announcement on Clarifying Matters concerning the Reduction/Exemption of Surcharges for Late Payment of Duties (the "Announcement"), which came into force on the date of issuance.

Notice regarding Corporate Income Tax (CIT) issues related to fees paid to overseas related parties (SAT Announcement [2015] No. 16)

On 29 July 2014, the State Administration of Taxation (SAT) released Shuizongbanfa [2014] No. 146 (“Circular 146”, i.e. Notice regarding the launch of tax anti-avoidance investigations on remittance of substantial amounts of service fees and royalty payments) to urge tax authorities at all levels to carry out extensive tax investigations on substantial amounts of service fees and royalties payments made by domestic enterprises to their overseas related parties from 2004 to 2013. Further to Circular 146, on 18 March 2015, the SAT released SAT Announcement [2015] No. 16 (“Announcement 16”) emphasizing the arm’s length principle and economic benefits; particularly, it sets out the determining factors of non deductibility of fees paid to overseas related parties by PRC enterprises (hereinafter referred to as the “domestic enterprises”), it also lays out other related tax administration and collection issues.

Notice regarding the “Foreign Investment Industrial Guidance Catalogue (Revised in 2015)” (NDRC/MOFCOM Order [2015] No. 22)

The Foreign Investment Industrial Guidance Catalogue (hereinafter referred to as “Catalogue”), serving as the basis of applying relevant policies to foreign investment projects, stipulates encouraged, restricted and prohibited foreign investment projects; projects not covered in the Catalogue shall be permissible. Currently, foreign investment projects shall be subject to administration according to the modes of general record filings and limited approval. Except for encouraged and restricted foreign investment projects subject to Chinese holding requirements that shall be subject to approval, other projects shall be subject to a record filing according to the principle of consistent supervision and administration of domestic and foreign investment projects. Record filing formalities for most foreign investment projects shall be handled by local governments. Qualifying encouraged foreign investment projects shall be eligible for exemption from Customs Duties on imported equipment. Encouraged foreign investment projects in western regions can enjoy a reduced Corporate Income Tax (CIT) rate of 15%.

Significant improvement on the corporate income tax treatments for restructuring transactions

In March 2014, the State Council issued a circular, Guofa [2014] No.14 (Circular 14)1, urging various government bodies to improve their policies so as to encourage mergers and acquisitions (M&A) in China. In response to Circular 14, the Ministry of Finance (MoF) and the State Administration of Taxation (SAT) recently released two new circulars Caishui [2014] No.109 (Circular 109) and Caishui [2014] No.116 (Circular 116) to substantially improve the corporate income tax (CIT) restructuring rules.

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