Tax-exemption registration

2015-11-16
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Handling of tax-exemption procedures for foreign-invested projects:

A. Basis: Shujianyi Document No. (1992) 1099 and Shushui Document No. (1997) 1062


B. Registration application

In application for tax-exemption registration, foreign-funded enterprises (Sino-foreign equity joint ventures, Sino-foreign contractual joint ventures, and wholly foreign-funded enterprises) should provide to customs the following documents:

1. Business license (duplicate)

2. Permit (duplicate)

3. Enterprise contract (Exemption is allowed for wholly foreign-funded enterprises.)

4. Articles of enterprise, and its official approval (duplicate)

5. The Approval Letter (original) should be submitted, if the enterprise was set up after January 1st 1998.

6. The completed Application for Registration of Tax-Collection and Tax-Exemption Project, that is standard and effective. (Stamped by the enterprise)

7. A financial status report (original and duplicate; Customs checks the original, and reserves the duplicate.)

8. Other documents demanded by Customs


C. Tax-exemption application:

In application for tax exemption, an enterprise which has been approved for registry by Customs should provide Customs the following documents:

1. Examination and approval forms for imported materials;

2. The completed Application for Tax-Collection and Tax-Exemption for Imported Goods that is standard and effective. (Stamped by the enterprise)

3. Three goods-ordering contracts or invoices (duplicate)

4. Other documents demanded by the customs


Tax Exemption Privileges Granted to Foreigners

The following incomes may be exempted from individual income taxes:

1.Incomes of personnel of foreign diplomatic missions in China and other personnel which conform to national regulations;

2. Foreign experts' incomes from wages and salaries which conform to national regulations;

3.Foreigners' housing allowance, meal allowance, removal expenses and laundry fees in non-cash forms or in the form of cash reimbursement; and business travel allowance, home visit allowance, language training expenses and children's tuition fees at reasonable levels;

4. Dividend and bonuses obtained from foreign-invested enterprises;

5. Incomes exempted from tax under international conventions and protocols signed by the Chinese government.

Income from interests on foreigners' savings deposits in China are liable to individual income tax, but enjoy limited tax rates prescribed under tax rules and regulations.

At this moment, China has no specific policy with regard to tax rebate for foreigners who make purchases in China. Foreign diplomatic missions and their officers who have purchased taxed products in China may apply to the competent authority of the Chinese government for tax rebate by presenting the receipts of their purchases. For more information, please contact the Guangzhou Foreign Affairs Office or the Guangzhou Municipal Office of the State Taxation Administration.


How to File Tax Returns and Pay Taxes

Entities and individuals paying employees have the obligation to deduct taxes from their payments and pay the deductions to the tax authority.

Under any of the following circumstances, a taxpayer shall file a tax return or engage a tax agent to do so on his or her behalf with the competent tax authority:

1. The taxpayer's annual income has exceeded RMB 120,000;

2. The taxpayer has obtained wages or salaries from two sources in China;

3. The taxpayer has an income from outside of China;

4. The taxpayer has obtained a taxable income but the paying party has no obligation to deduct tax payments from the income.