All companies registered in China must keep proper books of accounts as stipulated by the Chinese company law and tax regulation, thus it is essential to have an accounting specialist to help with your bookkeeping, payroll and tax returns etc.

 

Taxes levied by China towards enterprises mainly include corporate value added tax, income tax, consumption tax and customs duty.

Our contracted professional accountants will help you fulfill the compliance requirements stipulated by Chinese company law and tax regulation and avoid unnecessary penalties.

 

We provide the following services:

. Bookkeeping

. Business Tax Fling (Now VAT)

. Individual Income Filing

. Corporate Income Filing

. Annual Financial Statement

. Annual Audit Report

 

Individual Income Tax

from [RMB]	to [RMB]	tax rate [%]
0	18,000	3
18,001	54,000	10
54,001	108,000	20
108,001	420,000	25
420,001	660,000	30
660,001	960,000	35
960,001	over	45

 

Corporate Tax

Tax		Tax Rate
Value Added Tax	Small Scale Taxpayer	3%
	General Taxpayer	6%, 11%, 13%, 17%
Income Tax	Basic Tax Rate	25%
Cosumption Tax	Prefential Rate	15% & 20%
Custom Tax	Import Duty	0% - 270%
	Export Duty	0% - 50%
Urban Construction and Maintaince	Urbam Area Tax Rate	7%
	County Area Tax Rate	5%
	Other Area Tax Rate	1%
Stamp Duty		0.003% - 0.1%

 

 

 

Corporate Tax

 

There are four main types of corporate tax in China:

. Value added tax (VAT)

. Consumption tax

. Customs duty

. Corporate income tax

 

Value Added Tax

VAT is a type of turnover tax levied on the value added to a product arising from the production, circulation and labour service.

VAT is collected from "general taxpayers" and "small-scale taxpayers".

General Taxpayers

Commercial enterprises: with an annual turnover of more than RMB 800,000 Industrial enterprises: with an annual turnover of more than RMB 500,000

Small-scale Taxpayers

Commercial enterprises: with an annual turnover of not more than RMB 800,000 Industrial enterprises: with an annual turnover of not more than RMB 500,000

Tax Rate

The VAT rate is 6%, 11%, 13%, 17% for general taxpayers and 3% for small-scale taxpayers.

Export Refund

Compared with small-scale taxpayers, general taxpayers have a privilege for export refund.

 

Consumption Tax

Consumption tax is levied on specified categories of consumer goods in the form of an ad valorem tax, specific tax, or a combination of them. The ad valorem tax rate ranges between 1% and 56%.

The goods subject to the consumption tax include tobacco, alcoholic beverages, high-end cosmetics, jewelries, small-and-medium-sized automobiles, luxury watches, yachts and etc.

 

Customs Duty

Customs duty is levied by the Customs on the importation and exportation of goods.

 

Corporate Income Tax

Corporate income tax is levied on the business income of an enterprise. The new Corporate Income Tax Law of the People's Republic of China, which was effective as of 1 January 2008, supersedes the original income tax laws for domestic invested enterprises and foreign invested enterprises respectively by combining them.

Tax Rate

The corporate income tax rate is 25%.

 

 

Individual Tax

Following individuals shall pay individual income tax:


• An individual who has a domicile in the territory of China or who has no domicile but has stayed in the territory of China for one year or more shall pay individual income tax for his/her income obtained in and/or outside the territory of China. As to the income obtained outside the territory of China, if an individual who does not have a domicile but has resided in China for between one and five years, he/she may pay individual income tax only on the portion sourced from payments by China-based enterprises, economic organisations and individuals; if an individual who does not have a domicile but has resided in China for more than five years, he/she shall pay individual income tax on all his/her income obtained outside the territory of China from the sixth year onward.

• An individual who has no domicile and does not stay in the territory of China or who has no domicile but has stayed in the territory of China for less than one year shall pay individual income tax for his/her income obtained in the territory of China.

 

Income Include:

Income from wages and salaries, including wages, salaries, bonuses, allowances, year-end bonuses and dividends

Income from private industrial and commercial businesses from their operations

Income from interests and stock dividends

Income from property leasing

Income from property transfer

Occasional income, such as winning a lottery

Other income

 

Allowable Deductions

• Basic deduction: RMB 3,500 (RMB 4,800 for foreigners)
• Basic pension insurance, basic medical insurance and unemployment insurance paid by individuals • Housing provident fund deposited by individuals according to relevant regulations
• Standard allowances for official business vehicles and communications

 

Assessment Method

• Taxable income = Wages and salaries – Basic deduction – Other allowable deductions
• Tax amount payable = Taxable income × Applicable tax rate – Quick calculation deduction

Income from wages and salaries is taxed at a rate of 3% to 45% in an accumulative manner