An essential guide for all companies that have business dealings in China. It provides an overview of the current China Tax system and covers changes in tax laws. It also explores full spectrum of taxation issues including procedural matters such as assessment and payment, legislation, tax authority interpretation and circulars.
The new Enterprise Income Tax (EIT) Law took effect from 1 January 2008. Since then, various new rules and regulations were released to clarify uncertainties or conflicting interpretations. Besides, there are also new rules for other taxes. The 10th Edition of the book includes most of these important changes and provides practical guidance for customers to better cope with the new law.
In addition to EIT, China has witnessed reforms amendments of other non-EIT areas a few times in the past three decades, including Value-added Tax (VAT), Business Tax (BT), Individual Income Tax (IIT), Consumption Tax (CT), Urban Township Land Use Tax (UTLUT), Real Estate Tax (RET), etc. The IIT law was last amended on 30 June 2011, the UTLUT regulation was last amended on 30 December 2006; the regulations for VAT, BT and CT were last amended in November 2008.
Starting from 1 January 2012, China has launched a pilot VAT program where the taxation of specified sectors will transition to being subject to VAT rather than BT. The Urban Real Estate Tax (URET) regulation previously applicable to foreign investment enterprises, foreign enterprises and foreigners was abolished on 31 December 2008; instead, RET regulation has been applied to foreign investment enterprises, foreign enterprises and foreigners from 1 January 2009.
Undoubtedly, China's tax reforms conducted in the past three decades are a result of the economic development. As the economy continues to grow, additional amendments to the existing tax rules and regulations would be expected.
Features:
- Provides individuals and businesses with the answers to practical tax issues
- Gives an overview of the current China tax system and provides an understanding of how the system has developed to date
- Expertly updated by Deloitte Touche Tohmatsu
New to this Edition:
Special zones and cities and other special areas [¶2-270]
Individuals and Enterprises Liable to Income Tax
- PRC Social Security contribution for foreigners [¶3-070]
- Scope of small enterprises [¶3-620]
Taxable income and Exemption
- Employment-related benefits [¶4-030]
- Calculation method for tax borne by employer on annual bonus [¶4-080]
- Monthly standard deduction for employees and business owners [¶4-100]
- Contingency and other income for individual [¶4-190]
- Non-taxable income of government funding for resident enterprises [¶4-420]
- Controlled Foreign Corporations [¶4-630]
Deductions
- Statutory deductions for employment income [¶5-020]
- Deduction threshold for production and business income [¶5-030]
- Deduction for income from contracted or leasing income [¶5-040]
- Advertising and promotional expenses [¶5-960]
Depreciation of fixed assets
- Valuation of fixed assets [¶6-060]
- Preferential policies for software industry and integrated circuit producing enterprises [¶6-080]
Withholding tax
- Application [¶7-010]
- Rental income [¶7-130]
Tax rates
- Tax rates and range of applicable taxable income ranges for wages and salaries [¶8-040]
- Calculation of tax on bonuses [¶8-070]
Tax administration and collection
- Self-reporting for individual [¶9-220]
Preferential Tax Treatment
- High and new technology enterprises [¶12-110]
- Software and integrated circuit industry [¶12-120]
- Infrastructure development [¶12-140]
- Environmental protection, water or energy saving projects [¶12-150]
- Small scale enterprise [¶12-190]
- Treasury Bond interest income [¶12-190]
- Western region enterprises [¶12-230]
Value-Added Tax
- Exempt goods [¶13-150]
- Tax rates [¶13-310]
- Timing of input tax credit for general VAT taxpayer [¶13-320]
- Sales value of self-used fixed assets [¶13-330]
- Input tax on special items [¶13-340]
- Carry forward of excess input tax [¶13-340]
- Treatment on mixed sales activities [¶13-390]
- Software industries [¶13-410]
- VAT reform – pilot program in Shanghai [¶13-1010 ff]
Consumption tax
- Compound wine [¶14-250]
- Naphtha [¶14-250]
- Fuel oil [¶14-250]
Business tax
- Tax rates for animation industry [¶15-450]
Stamp duty
- Exempt documents [¶17-020]
Deed tax
- Exemption of tax [¶17-230]
Urban and Township Land Use Tax
- Exemption of tax [¶17-530]
Resource Tax
- Scope of charge [¶17-810]
- Tax rate and calculation [¶17-820]
- Exemption and reduction [¶17-830]
Customs
- Classification [¶18-210]
- Advanced ruling for customs valuation [¶18-330]
- Special duty reduction and exemption [¶18-1010]
- Import/ export inspection and quarantine [¶18-1120]
Transfer pricing
