Tax liability for non-resident enterprises engaging in service provision

Save this PDF as:
 WORD  PNG  TXT  JPG

Size: px
Start display at page:

Download "Tax liability for non-resident enterprises engaging in service provision"

Transcription

1 Tax liability for non-resident enterprises engaging in service provision More and more European companies are facing the question of whether they actually have to pay taxes in China when providing services to Chinese customers, and if so, to what extent. The tax liability of a non-resident enterprise can hereinafter be illustrated with three practical examples: Case 1. A German company delivers a machine to a Chinese customer. The Chinese company is located in Beijing. In order to put its machine into operation, the German company has signed a service contract with the Chinese customer and sent an employee to China for a period of less than 6 months. The value of the contract is CNY 500,000. Case 2. Like case 1 but in this example the German company sent an employee to China for a period of more than 6 months. Case 3. A Belgian company provides services to a Chinese customer without sending an employee to China or having any other kind of establishment in mainland China. The seat of the Chinese company is a small county town in Guangdong province. The value of the business is CNY 100,000. Generally speaking enterprise income tax, business tax and some additional taxes based on the business tax have to be taken into account. 1. Enterprise income tax i. Tax liability in general In terms of the enterprise income tax, the Chinese Enterprise Income Tax Law (hereinafter EITL ) distinguishes between resident and non-resident enterprises. A resident enterprise is an enterprise incorporated under the Chinese law or an enterprise incorporated under laws of a foreign country or other tax region but with its actual management located in China. Resident enterprises are normally subject to income tax levied at the rate of 25% within and outside China. To be considered as a non-resident enterprise, three requirements must be met: - The enterprise is incorporated under foreign law or law of other tax region; - Its actual management is located abroad; and - It either has an establishment in China or has generated revenue from Chinese sources without having an establishment in China. An establishment could be for instance a place of operation or administration, a place where services are rendered, a place of construction, or installation. 1

2 ii. Tax liability of non-resident enterprise without establishment in China A non-resident enterprise having no establishment in China is liable to pay enterprise income tax only for its income derived in China. Income in this sense consists principally of dividends and interest income. Under tax treaties other incomes sourced by a non-resident enterprise should not be subject to enterprise income tax in China unless it maintains a permanent establishment in China under the tax treaty. Permanent establishment is a definition used in bilateral tax treaties for the purpose of determining the right of a contracting State to collect tax from enterprises of the other contracting state. A foreign company will be deemed to have an establishment if it has provided services by sending an employee to China and the actual work period of the employee in China exceeds 6 months aggregately within a calendar year. All the EU Member States have concluded a tax treaty with China. Please note that the tax treaties with Malta, Belgium and the Czech Republic have not yet entered into force. All the tax treaties are available on the homepage of the State Administration of Taxation (SAT). Since 2009 the preferential treatment under the tax treaty does not apply automatically. According to the SAT Circular Guoshuifa (2009) No. 124 it is mandatory for non-residents to request approval for treaty benefits with the tax authority in charge. In this regard an agent, for instance the Chinese customer, can be appointed by the non-resident enterprise to carry out the procedure. However in practice many Chinese tax authorities still levy enterprise income tax on the service fees generated by non-resident enterprises without permanent establishment in China. In this context it is advisable to contact the relevant tax authorities at an early stage in order to clarify the local applicable tax characteristics. In case the local tax authorities levy a withholding tax, the following principles shall be applied: The competent tax authority assesses the tax liability of the foreign company pursuant to the present service contract and possibly additional relevant research. The tax rate for non-resident enterprises without establishment is 10%. Tax base is the total turnover that the foreign enterprise generates in China for the relevant project. No expenses related to the services are to be deducted in this case. And the Chinese customer is obliged to withhold the tax for the European company and to transfer it to the appropriate State tax authority. iii. Tax liability of non-resident enterprise with establishment/permanent establishment in China A non-resident enterprise with establishment/permanent establishment (hereinafter with establishment ) in China shall pay enterprise income tax on China-sourced income derived by the establishment, and also on income arising outside China but effectively connected with such an establishment. The location where the services are rendered is the decisive factor in determining the source of income. The tax rate for non-resident enterprises with establishment in China is 25%. Non-resident enterprises with establishments in China shall set up and maintain accounting books and records and accurately calculate the taxable income. The enterprise income tax is to be declared and paid on an actual basis. In case the company is unable to accurately calculate and file the taxable income due to incomplete bookkeeping, or for any other reason, the tax authority is entitled to assess taxable income using one of 2

3 the following methods: deemed profit based on total revenue, deemed profit based on costs and expenses or deemed profit based on operating expenditures. (1) Deemed profit based on total revenue Taxable income = gross revenue x deemed profit rate (2) Deemed profit based on costs and expenses Taxable income = total costs and expenses (1- deemed profit rate) x deemed profit rate (3) Deemed profit based on operating expenditures Taxable income = total costs and expenditures (1 - deemed profit rate business tax rate) x deemed profit rate The profit rate for the provision of services is normally 15-30% as determined by the relevant tax authority. iv. Case studies In case 1, by sending an employee to China for less than 6 months, the German company is a nonresident enterprise without establishment in China. The taxation regarding the enterprise income tax depends on the respective tax authority. In most districts of Beijing no enterprise income tax will be levied in this case. In other locations which do not follow the tax treaty, the German company must pay an enterprise income tax amounting to CNY 50,000 (CNY 500,000 x 10%) on a withholding basis. In case 2, by sending an employee to China for longer than 6 months, the German company is deemed to be a non-resident enterprise with establishment in China. Assuming the tax authority has assessed the taxable income using the method of deemed profit based on total revenue and the determined profit rate is 20%, the enterprise income tax payable shall be CNY 25,000 (CNY 500,000 x 20% x 25%). In case 3, the service has been rendered in Belgium. Therefore the income is not China-sourced income and no enterprise income tax is due. 2. Business tax i. Tax liability The Chinese taxation law distinguishes between business tax and Value-Added Tax (VAT). Companies engaging in the sale of goods are generally subject to VAT. Business tax is a turnover tax imposed upon activities involving services and intangible goods. Exceptions to this are processing, repair and replacement services, which are subject to VAT. A business tax has to be paid where either the service provider or the recipient is located in China. Therefore a business tax will be levied on foreign companies rendering services outside China to Chinese clients. Before January 2009 only services performed in China were subject to business tax. Business tax is calculated based on turnover and the applicable tax rate (Business tax payable = turnover x applicable tax rate). ii. Taxable income According to the preliminary regulations on business tax, turnover consists of the entire remuneration and the additional fees received by the taxpayer for providing the taxable service. The additional fees are more closely defined in the implementing rules on the preliminary regulations on business tax and 3

4 include allowances, penalties, interest, commissioned payments and charges, costs, etc. received by the taxpayer. If taxable services are offered at obviously low prices without proper justification, tax authorities are entitled to determine the turnover at their own discretion. iii. Taxation rate Under the provisional regulations on business tax, the tax rate for service amounts to 5%. iv. Taxation method For non-resident enterprises subject to business tax, self-declaration is required where it has an establishment in China. For non-resident enterprises without business establishment in China the Chinese customer is obliged to withhold the tax payable by the non-resident enterprise and to remit it to the relevant local tax authority. v. Case studies In the abovementioned three cases both the German company and the Belgian company are liable to pay business tax, since the company receiving the service is located in China. In the first two cases the payable business tax amounts to CNY 25,000 (CNY 500,000 x 5%). In case 3 5,000 CNY (CNY 100,000 x 5%) business tax is levied. 3. Additional taxes based on the business tax i. Tax liability In China there are two additional taxes based on the business tax: the urban construction tax and the education surcharge. Until December 1 st 2010 foreign companies were excluded from paying these taxes. As part of the programme of tax unification, this privilege has been abandoned by the Chinese government. Therefore foreign companies subject to business tax in China are now liable to pay these additional fees. ii. Taxable base The base for calculating urban construction tax and the education surcharge is the amount of the business tax payable by the foreign companies. iii. Taxation rate The urban construction tax rates are set at 7%, 5% and 1% of the business tax depending on whether the business is located in a city, county town or a place other than a city or town. In the case of a nonresident enterprise, the taxation rate depends on the registered seat of the Chinese customer. In terms of the education surcharge two taxation rates have to be considered. The first one is the national education surcharge amounting to 3%. Additionally the provinces are encouraged to collect a local education surcharge which can be up to an additional 2%. 4

5 iv. Taxation method Similar to the taxation of business taxes, foreign companies with business establishment in China have to file self-declaration with the relevant local tax authority. For foreign companies without a legal entity in China, the Chinese customers have to function as a withholding agent. The tax is calculated based on business tax amount and the applicable tax rate (= business tax amount x applicable tax rate). v. Case studies Since all companies in our case studies have to pay business tax, they are all subject to the additional taxes based on the business tax. Case 1 and case 2: the Chinese client of the German company is located in the city area of Beijing. The urban construction tax rate is therefore 7% and the urban construction tax is CNY 1,750 (CNY 25,000 x 7%). The education surcharge is CNY 750 (CNY 25,000 x 3%). In Beijing, the local education surcharge will be levied from 1 st January In case 3, the company is subject to the local education surcharge amounting to CNY 500 (CNY 25,000 x 2%) from 1 st January Case 3: The Belgian company has to pay an urban construction tax in the amount of CNY 250 (CNY 5,000 x 5%), since the Chinese company is located in the town area. The education surcharge is CNY 250 (national education surcharge: CNY 5,000 x 3% and local education surcharge: 5,000 x 2%). Contact the Centre at: Room 910, Sunflower Tower 37 Maizidian West Street Chaoyang District Beijing, T: F: The EU SME Centre assists European SMEs to export to China by providing a comprehensive range of free, hands-on support services including the provision of information, confidential advice, networking events and training. The Centre also acts as a platform facilitating coordination amongst Member State and European public and private sector service providers to SMEs. The Centre s range of free services cover: Business Development provision of market information, business and marketing advice Legal legal information, ask the expert initial consultations and practical manuals Standards standards and conformity requirements when exporting to China HR and Training industry and horizontal training programmes Access to a service providers directory and information databases Hot-desking free, temporary office space in the EU SME Centre to explore local business opportunities Any other practical support services to EU SMEs wishing to export to or invest in China. Disclaimer This document is provided for general information purposes only and does not constitute legal, investment or other professional advice on any subject matter. Whereas every effort has been made to ensure that the information given in this document is accurate, the EU SME Centre accepts no liability for any errors, omissions or misleading statements, and no warranty is given or responsibility accepted as to the standing of any individual, firm, company or other organisation mentioned. Publication as well as commercial and non-commercial transmission to a third party is prohibited unless prior permission is obtained from the EU SME Centre. The views expressed in this publication do not necessarily reflect the views of the European Commission. Date: May, 2011 The EU SME Centre is a project funded by the European Union. 5

6 6

Individual income tax in China

Individual income tax in China Individual income tax in China Individual income tax ( IIT ) is a complicated tax framework and many expatriates are confused about how to determine their tax liability in China. It is strongly recommended

More information

Labour laws in China. 1. Main laws and regulations

Labour laws in China. 1. Main laws and regulations Labour laws in China It is critical for European SMEs doing business, or planning to do business, in China to understand China s labour laws. The overall design of the legislation is to ensure and protect

More information

Cosmetic products in China

Cosmetic products in China Cosmetic products in China Imported cosmetics need pre-market approval before entering China All cosmetics imported into China are required to obtain pre-market approval or notification from the Chinese

More information

TAXATION AND FOREIGN EXCHANGE

TAXATION AND FOREIGN EXCHANGE This appendix contains a summary of laws and regulations in respect of taxation and foreign exchange in Hong Kong and the PRC. I. TAXATION IN THE PRC 1. Taxes Applicable to Joint-Stock Limited Companies

More information

China RoHS label. When does the China RoHS label apply?

China RoHS label. When does the China RoHS label apply? China RoHS label When does the China RoHS label apply? China has enforced a measure Restricting the use of Hazardous Substances (RoHS) in electronic equipment and the measure can in many ways be compared

More information

Chapter 1 Legislative Background and Tax Reform

Chapter 1 Legislative Background and Tax Reform Chapter 1 Legislative Background and Tax Reform The Chinese tax system has recently developed closely to the economic growth of the country. The entry of China into the World Trade Organization (WTO) and

More information

Starting a Business in Israel

Starting a Business in Israel Starting a Business in Israel Inspiration Invention Innovation Content: Page 1. Business Entities....... 2 a. Company...... 2 b. Foreign Company (e.g. a branch)...... 2 c. Partnership...... 3 d. Self Employed......

More information

Guide to Japanese Taxes

Guide to Japanese Taxes Guide to Japanese Taxes CONTENTS 1. Introduction --------------------------------------------------------------------------------------------- 1 (1) Principle of Taxation under the Law (2) Self-Assessment

More information

Importing pharmaceutical products to China

Importing pharmaceutical products to China Importing pharmaceutical products to China Imported pharmaceutical products need pre-market approval before entering the Chinese market Imported drugs for human use are required to obtain pre-market approval

More information

TURKEY CORPORATE TAX (KURUMLAR VERGISI) The basic rate of corporation tax for resident and non-resident companies in Turkey is 20%.

TURKEY CORPORATE TAX (KURUMLAR VERGISI) The basic rate of corporation tax for resident and non-resident companies in Turkey is 20%. TURKEY CORPORATE TAX (KURUMLAR VERGISI) The basic rate of corporation tax for resident and non-resident companies in Turkey is 20%. Corporations in Turkey can be regarded as either limited or unlimited

More information

2013 Thinking Beyond Borders

2013 Thinking Beyond Borders INTERNATIONAL EXECUTIVE SERVICES 2013 Thinking Beyond Borders Ukraine kpmg.com Ukraine Introduction Individuals are subject to Ukrainian income tax as either tax residents or tax non-residents. Residents

More information

Income tax for individuals is computed on a monthly basis by applying the above progressive tax rates to employment income.

Income tax for individuals is computed on a monthly basis by applying the above progressive tax rates to employment income. Worldwide personal tax guide 2013 2014 China Local information Tax Authority Website Tax Year Tax Return due date Is joint filing possible Are tax return extensions possible State Administration of Taxation

More information

Country Tax Guide.

Country Tax Guide. Country Tax Guide www.bakertillyinternational.com Country Tax Guide Germany Corporate Income Taxes Resident companies, defined as companies which are legally constituted in Germany, or which are legally

More information

Doing business in Sweden. www.pwc.se/doingbusinessinsweden

Doing business in Sweden. www.pwc.se/doingbusinessinsweden Doing business in Sweden www.pwc.se/doingbusinessinsweden 1. What type of presence do we require? 2. What other registrations do we need to be aware of? 3. What tax issues may arise now that we are operating

More information

Thinking Beyond Borders

Thinking Beyond Borders INTERNATIONAL EXECUTIVE SERVICES Thinking Beyond Borders Tanzania kpmg.com Tanzania Introduction Taxation of individuals under the Income Tax Act 2004 (ITA) is on the basis of both residence and source.

More information

GENERAL OVERVIEW OF TAXES, LEVIED IN UKRAINE

GENERAL OVERVIEW OF TAXES, LEVIED IN UKRAINE GENERAL OVERVIEW OF TAXES, LEVIED IN UKRAINE General information on the tax system of Ukraine For the purposes of further discussion we feel it appropriate to provide first brief overview of the tax system

More information

New VAT Regime: Circular 37 Impact on Foreign Logistics and Shipping Industry

New VAT Regime: Circular 37 Impact on Foreign Logistics and Shipping Industry New VAT Regime: Circular 37 Impact on Foreign Logistics and Shipping Industry 1. Background and Impact On 24 th May 2013, the Ministry of Finance and the State Administration of Taxation issued a new VAT

More information

Thinking Beyond Borders

Thinking Beyond Borders INTERNATIONAL EXECUTIVE SERVICES Thinking Beyond Borders Syria kpmg.com Syria Introduction No personal tax declarations are required to be filed in Syria. Residents and nonresidents are generally taxed

More information

China Enterprise Income Tax

China Enterprise Income Tax China Enterprise Income Tax In the People s Republic of China ( the PRC, hereinafter refer to as China), there are around fifteen types of taxes that foreign entities may need to pay, which includes Enterprise

More information

The above are the rates of the personal income tax (imposta sul reddito delle persone fisiche, or IRPEF).

The above are the rates of the personal income tax (imposta sul reddito delle persone fisiche, or IRPEF). Worldwide personal tax guide 2013 2014 Italy Local information Tax Authority Italian Revenue Agency Website www.agenziaentrate.gov.it Tax Year 1 January to 31 December Tax Return due date 30 September

More information

Slovenia. Chapter. Avbreht, Zajc & Partners Ltd. 1 General: Treaties. 2 Transaction Taxes. Ursula Smuk

Slovenia. Chapter. Avbreht, Zajc & Partners Ltd. 1 General: Treaties. 2 Transaction Taxes. Ursula Smuk Chapter Avbreht, Zajc & Partners Ltd. Ursula Smuk 1 General: Treaties 1.1 How many income tax treaties are currently in force in? 44 income tax treaties are currently in force in. 1.2 Do they generally

More information

Hiring Foreign Staff in the PRC

Hiring Foreign Staff in the PRC Hiring Foreign Staff in the PRC 8 May 2014, Guangzhou / Shenzhen Success beyond borders we advise German businesses worldwide! 1 Agenda I. Residence and Work Permit for Expatriates II. Employment Contract

More information

REGULATORY OVERVIEW. PRC Laws and Regulations Relating to the Product Liability

REGULATORY OVERVIEW. PRC Laws and Regulations Relating to the Product Liability Although our Company was incorporated in the Cayman Islands, a substantial part of our Group s operations are conducted in the PRC and are governed by PRC Laws and Regulations. This section sets out summaries

More information

Corporate taxation and asset depreciation rules are described in the Fact Sheet on Corporate Tax and Depreciation.

Corporate taxation and asset depreciation rules are described in the Fact Sheet on Corporate Tax and Depreciation. 13. Taxation The system of taxation described below is derived from the Czech tax legislation and may be modified by a particular Double Taxation Treaty. The current tax system was introduced in January

More information

Monaco Corporate Taxation

Monaco Corporate Taxation Introduction Monaco is a sovereign principality. France is a guarantor of the sovereignty and territorial integrity of Monaco, while Monaco is to conform to French interests. Although the Prince is the

More information

TAXATION AND FOREIGN EXCHANGE

TAXATION AND FOREIGN EXCHANGE 1. TAXATION OF SECURITY HOLDERS The taxation of income and capital gains of holders of H Shares is subject to the laws and practices of the PRC and of jurisdictions in which holders of H Shares are resident

More information

Country Tax Guide. www.bakertillyinternational.com

Country Tax Guide. www.bakertillyinternational.com www.bakertillyinternational.com International Tax Contact Moscow Andrey Kirillov T: +7 (495) 783 88 00 a.kirillov@bakertillyrussaudit.ru Corporate Income Taxes Resident companies, defined as those which

More information

Implementation of the EU tax directives in Poland

Implementation of the EU tax directives in Poland Bartosz Bacia Implementation of the EU tax directives in Poland Since Poland joined the EU on May 1 2004, Polish tax law need to be adapted to the EU Council directives for the member states. The new legal

More information

70. Switzerland. Other regulations

70. Switzerland. Other regulations 70. Switzerland Introduction Switzerland does not have specific transfer pricing regulations but respectively adheres to the Organisation for Economic Co-operation and Development (OECD) Guidelines. As

More information

News Flash. September, 2015. Tax guide for property investment in Hungary

News Flash. September, 2015. Tax guide for property investment in Hungary News Flash September, 2015 Tax guide for property investment in Hungary Tax guide for property investment in Hungary In our current newsletter we would like to inform you about the most important taxation

More information

A 5.5% solidarity surcharge is imposed on the income tax liability of all taxpayers.

A 5.5% solidarity surcharge is imposed on the income tax liability of all taxpayers. Worldwide personal tax guide 2013 2014 Germany Local information Tax Authority Website Tax Year Tax Return due date 31 May 2013 Is joint filing possible Are tax return extensions possible 2013 income tax

More information

Thinking Beyond Borders

Thinking Beyond Borders INTERNATIONAL EXECUTIVE SERVICES Thinking Beyond Borders Jordan kpmg.com Jordan Introduction Individual income tax is calculated at rate of 7 percent on the first 12,000 Jordan dinars (JOD) of taxable

More information

Hong Kong (Brenda Chan, Nexia Charles Mar Fan & Co, brenda@charles-marfan.com) Reviewed January 2015

Hong Kong (Brenda Chan, Nexia Charles Mar Fan & Co, brenda@charles-marfan.com) Reviewed January 2015 Hong Kong (Brenda Chan, Nexia Charles Mar Fan & Co, brenda@charles-marfan.com) Reviewed January 2015 I MAIN LEGAL FORMS Legal form Characteristics Partnership and Limited Liability Partnership (LLP) Private

More information

DOING BUSINESS IN GERMANY Overview on Taxation

DOING BUSINESS IN GERMANY Overview on Taxation DOING BUSINESS IN GERMANY Overview on Taxation March 2015 1. Introduction 1.1. Generally, taxes are administered and enforced by the competent local tax office. These local tax offices administer in particular

More information

Receita Federal do Brasil (RFB) www.receita.fazenda.gov.br 1 January to 31 December Last working day of April following end of tax year

Receita Federal do Brasil (RFB) www.receita.fazenda.gov.br 1 January to 31 December Last working day of April following end of tax year Worldwide personal tax guide 2013 2014 Brazil Local Information Tax Authority Receita Federal do Brasil (RFB) Website www.receita.fazenda.gov.br Tax Year 1 January to 31 December Tax Return due date: Last

More information

Export of goods to China

Export of goods to China Export of goods to China The Chinese market is becoming more and more open for imported foreign goods. The trend is of course encouraging for European exporters, however import to China still remains regulated

More information

Income in the Netherlands is categorised into boxes. The above table relates to Box 1 income.

Income in the Netherlands is categorised into boxes. The above table relates to Box 1 income. Worldwide personal tax guide 2013 2014 The Netherlands Local information Tax Authority Website Tax Year Tax Return due date Is joint filing possible Are tax return extensions possible Belastingdienst www.belastingdienst.nl

More information

FOREWORD. Namibia. Services provided by member firms include:

FOREWORD. Namibia. Services provided by member firms include: FOREWORD A country's tax regime is always a key factor for any business considering moving into new markets. What is the corporate tax rate? Are there any incentives for overseas businesses? Are there

More information

(7) For taxable years beginning after December 31, 2012, every. nonresident estate having for the taxable year any gross income

(7) For taxable years beginning after December 31, 2012, every. nonresident estate having for the taxable year any gross income IC 6-3-4 Chapter 4. Returns and Remittances IC 6-3-4-1 Who must make returns Sec. 1. Returns with respect to taxes imposed by this act shall be made by the following: (1) Every resident individual having

More information

TAXATION AND FOREIGN EXCHANGE

TAXATION AND FOREIGN EXCHANGE TAXATION OF EQUITY HOLDERS The following is a summary of certain PRC and Hong Kong tax consequences of the ownership of H Shares by an investor that purchases such H Shares in the Global Offering and holds

More information

Introduction to Taxation

Introduction to Taxation Introduction to Taxation Taxes are the price we pay for a civilized society. - Oliver Wendell Holmes, Jr. Taxation is a financial charge imposed on people. Taxation is a means whereby the state collects

More information

China Tax Newsletter. January 2014

China Tax Newsletter. January 2014 BDO China Shu Lun Pan Certified Public Accountants LLP LIXIN Certified Tax Agents Co., Ltd China Tax Newsletter Our tax newsletter for this month covers: 1. Goods Meeting Certain Requirements that Are

More information

IRAS e-tax Guide. Tax Exemption for Foreign-Sourced Income (Second edition)

IRAS e-tax Guide. Tax Exemption for Foreign-Sourced Income (Second edition) IRAS e-tax Guide Tax Exemption for Foreign-Sourced Income (Second edition) Published by Inland Revenue Authority of Singapore Published on 31 May 2013 First edition on 6 Sep 2011 Disclaimers IRAS shall

More information

Helpful information on taxation, VAT and customs duties for operators involved in oil and gas exploration on the Faroe Islands

Helpful information on taxation, VAT and customs duties for operators involved in oil and gas exploration on the Faroe Islands Helpful information on taxation, VAT and customs duties for operators involved in oil and gas exploration on the Faroe Islands Tax liability In addition to the ordinary tax regime in the Faroe Islands,

More information

China Tax Monthly. 1. Recent anti-avoidance cases in China. Beijing/Hong Kong/Shanghai. a. The Shanxi Permanent Establishment ( PE ) Case

China Tax Monthly. 1. Recent anti-avoidance cases in China. Beijing/Hong Kong/Shanghai. a. The Shanxi Permanent Establishment ( PE ) Case China Tax Monthly Beijing/Hong Kong/Shanghai January & February 2013 China Tax Monthly is a monthly publication of Baker & McKenzie s China Tax Group. In this issue of the Newsletter, we will discuss the

More information

IIT and Social Insurance for Foreigners Employed in China.

IIT and Social Insurance for Foreigners Employed in China. IIT and Social Insurance for Foreigners Employed in China. www.lehmanbrown.com Individual Income Tax (IIT) General IIT Principles For individuals to pay tax in China (PRC Tax Resident), they need to be

More information

Costa Rica. Key messages Extended business travelers are likely to be taxed on employment income relating to their Costa Rican work days.

Costa Rica. Key messages Extended business travelers are likely to be taxed on employment income relating to their Costa Rican work days. Costa Rica Introduction A person s liability to Costa Rican income tax is determined by the territoriality principle, in opposition to the method of taxation based on residence status. However, residents

More information

The Netherlands as the European business hub for Indonesian companies

The Netherlands as the European business hub for Indonesian companies The Netherlands as the European business hub for Indonesian companies a tax perspective 2012 edition By Vinod Kalloe, KPMG Meijburg & Co Netherlands Amsterdam 19 September 2012, Jakarta, Indonesia Content

More information

VALUE ADDED TAX in GREATER CHINA Risks and Opportunities

VALUE ADDED TAX in GREATER CHINA Risks and Opportunities VALUE ADDED TAX in GREATER CHINA Risks and Opportunities Mr. Michael Lorenz German Attorney at Law, Registered Foreign Lawyer in Hong Kong and Vietnam Lorenz & Partners Page 1 About Lorenz & Partners We

More information

Terms and Conditions for Embedded Software Products and Embedded Software Services

Terms and Conditions for Embedded Software Products and Embedded Software Services 1 Terms and Conditions for Embedded Software Products and Embedded Software Services I. Delivery of Embedded Software Products of Vector (Standard Software) 1 Scope of Delivery 1.1 Vector shall deliver

More information

Guideline for accounting and tax procedures in NL

Guideline for accounting and tax procedures in NL 1 Guideline for accounting and tax procedures in NL 1. Annual Financial Statement 2. Corporate Income Tax Return 3. Transfer Pricing 4. VAT Return 5. EU Sales Listings 6. Intrastat Reports 7. Payroll Taxes

More information

FOREWORD. Bangladesh. Services provided by member firms include:

FOREWORD. Bangladesh. Services provided by member firms include: 2015/16 FOREWORD A country's tax regime is always a key factor for any business considering moving into new markets. What is the corporate tax rate? Are there any incentives for overseas businesses? Are

More information

Thinking Beyond Borders

Thinking Beyond Borders INTERNATIONAL EXECUTIVE SERVICES Thinking Beyond Borders Uganda kpmg.com Uganda Introduction An individual s liability to income tax in Uganda is determined according to the nature of income earned and

More information

1. Israeli Tax Treaties General Overview

1. Israeli Tax Treaties General Overview 1. Israeli Tax Treaties General Overview This year marks Israel's 60 th anniversary. The country is known for having a relatively high volume of international economic activity, both incoming and outgoing

More information

MERKBLATT PROTECTION FROM TAX LIABILITY. Index: Recht und Steuern

MERKBLATT PROTECTION FROM TAX LIABILITY. Index: Recht und Steuern MERKBLATT Recht und Steuern PROTECTION FROM TAX LIABILITY Information from your Chamber of Commerce and Industry (IHK): What should you remember when submitting tax declarations and paying tax? How can

More information

CYPRUS TAX CONSIDERATIONS

CYPRUS TAX CONSIDERATIONS TAXATION The following summary of material Cyprus, US federal income and United Kingdom tax consequences of ownership of the GDRs is based upon laws, regulations, decrees, rulings, income tax conventions

More information

15 Double Taxation Relief

15 Double Taxation Relief 15 Double Taxation Relief 15.1 Concept of Double Taxation Relief In the present era of cross-border transactions across the globe, the effect of taxation is one of the important considerations for any

More information

Holding companies in Ireland

Holding companies in Ireland Holding companies in Irel David Lawless Paul Moloney Dillon Eustace, Dublin Irel has long been a destination of choice for holding companies because of its low corporation tax rate of 12.5 percent, participation

More information

Global Mobility Services: Taxation of International Assignees - Botswana

Global Mobility Services: Taxation of International Assignees - Botswana http://www.pwc.com/bw/en/index.jhtml Global Mobility Services: Taxation of International Assignees - Botswana Taxation issues & related matters for employers & employees 2015/16 Last Updated: June 2016

More information

Setting up your Business in Bulgaria Issues to consider

Setting up your Business in Bulgaria Issues to consider Bulgaria is a parliamentary republic situated in the heart of the Balkan Peninsula at the south - east part of Europe. It is a member of NATO since 2004 and of the European Union since 2007. The territory

More information

EXPLANATORY NOTES ON THE CRITICAL TAX ISSUES FOR THE OPERATION OF BANK HOLDING COMPANY STRUCTURE IN NIGERIA

EXPLANATORY NOTES ON THE CRITICAL TAX ISSUES FOR THE OPERATION OF BANK HOLDING COMPANY STRUCTURE IN NIGERIA NIGERIA INFORMATION CIRCULAR Published: April, 2012 Subject: EXPLANATORY NOTES ON THE CRITICAL TAX ISSUES FOR THE OPERATION OF BANK HOLDING COMPANY STRUCTURE IN NIGERIA This circular is made to address

More information

Tax Guide 2014/15 South Africa

Tax Guide 2014/15 South Africa Tax Guide 2014/15 South Africa Individuals and Trusts Tax Rates 1 March 2014 to 28 February 2015 Individual Taxpayers and Special Trusts Taxable Income R0 174 550 Rate of Tax 18% of taxable income R174

More information

Facts on Taxation in Denmark

Facts on Taxation in Denmark Facts on Taxation in Denmark Updated by Njord Law Firm, December 2015 www.investindk.com Contents Corporate taxation... 2 Tax liability for different corporate forms... 2 Full or limited tax liability...

More information

BUDGET TAX GUIDE

BUDGET TAX GUIDE 2016 BUDGET TAX GUIDE 1 2 This SARS pocket tax guide has been developed to provide a synopsis of the most important tax, duty and levy related information for 2016/17. INCOME TAX: INDIVIDUALS AND TRUSTS

More information

Bosera ETFs. Bosera FTSE China A50 Index ETF

Bosera ETFs. Bosera FTSE China A50 Index ETF Important: If you are in any doubt about the contents of this Addendum, you should consult your stockbroker, bank manager, solicitor, accountant or other financial adviser. This Addendum forms an integral

More information

INCOME TAX : INCOME TAX ACT, 1962 (the Act) : SECTION 10(1)(o)(ii) : EXEMPTION FROM INCOME TAX: FOREIGN EMPLOYMENT INCOME

INCOME TAX : INCOME TAX ACT, 1962 (the Act) : SECTION 10(1)(o)(ii) : EXEMPTION FROM INCOME TAX: FOREIGN EMPLOYMENT INCOME SOUTH AFRICAN REVENUE SERVICE INCOME TAX INTERPRETATION NOTE NO. 16 DATE: 27 March 2003 INCOME TAX ACT SECTION SUBJECT : INCOME TAX ACT, 1962 (the Act) : SECTION 10(1)(o)(ii) : EXEMPTION FROM INCOME TAX:

More information

Company Car Tax and Related Certain Personal Income Tax Issues 2014.

Company Car Tax and Related Certain Personal Income Tax Issues 2014. Company Car Tax and Related Certain Personal Income Tax Issues 2014. The tax liability relating to company cars is regulated in Chapter IV. of Act LXXXII of 1991 on the Motor Vehicle Tax (hereinafter:

More information

Setting up your Business in Argentina Issues to consider

Setting up your Business in Argentina Issues to consider Argentina boasts many natural resources, qualified human resources and the synergies deriving from our commercial partnership with countries like Brazil make it an attractive country in which to invest.

More information

Company Formation in Austria. Tax l Accounting l Audit l Advisory

Company Formation in Austria. Tax l Accounting l Audit l Advisory Tax l Accounting l Audit l Advisory Company Formation in Austria When considering an investment abroad thought must be given to taxation of income received as dividends and interest as well as any capital

More information

INCOME TAX PRACTICES MAINTAINED BY BELGIUM. Report of the Panel presented to the Council of Representatives on 12 November 1976 (L/4424-23S/127)

INCOME TAX PRACTICES MAINTAINED BY BELGIUM. Report of the Panel presented to the Council of Representatives on 12 November 1976 (L/4424-23S/127) 2 November 1976 INCOME TAX PRACTICES MAINTAINED BY BELGIUM Report of the Panel presented to the Council of Representatives on 12 November 1976 (L/4424-23S/127) 1. The Panel's terms of reference were established

More information

55 Amendment of section 1 (interpretation) of the VAT Act 1972

55 Amendment of section 1 (interpretation) of the VAT Act 1972 54 Interpretation (Part 3) This section contains definitions of the legal citations used in Part 3. This is a conventional provision in Finance Acts. It allows abbreviated terms to be used in reference

More information

G E N C S V A L T E R S L A W F I R M B A L T I C T A X C A R D 2 0 1 5

G E N C S V A L T E R S L A W F I R M B A L T I C T A X C A R D 2 0 1 5 PERSONAL INCOME TAX IN BALTICS Personal Income Tax Rates in Baltics Country Social Tax- employee share Social Tax- employer share Personal Income Tax Latvia 10.50% 23.59% 23% Lithuania 9% 30.98% - 32.6%

More information

Thinking Beyond Borders

Thinking Beyond Borders INTERNATIONAL EXECUTIVE SERVICES Thinking Beyond Borders Norway kpmg.com Norway Introduction A person s Norwegian tax liability is determined by residence status for taxation purposes and the source of

More information

Name of the firm Tax Support Ltd. Address A.Metaxa 33. Nikos Dimitrakopoulos Tel. No

Name of the firm Tax Support Ltd. Address A.Metaxa 33. Nikos Dimitrakopoulos Tel. No GREECE Name of the firm Tax Support Ltd Address A.Metaxa 33 16674 Glyfada Contact Nikos Dimitrakopoulos forotech@forotech.gr Tel. No. +30 2108981633 Partner www.taxsupport.gr AT A GLANCE Name of the tax

More information

FOREWORD. Botswana. Services provided by member firms include:

FOREWORD. Botswana. Services provided by member firms include: 2015/16 FOREWORD A country's tax regime is always a key factor for any business considering moving into new markets. What is the corporate tax rate? Are there any incentives for overseas businesses? Are

More information

TAX TAX NEWSLETTER. July 2012. General Information on the Tax Implications of Carrying On Business in Trinidad and Tobago (T&T) Issues Discussed

TAX TAX NEWSLETTER. July 2012. General Information on the Tax Implications of Carrying On Business in Trinidad and Tobago (T&T) Issues Discussed TAX NEWSLETTER July 2012 Issues Discussed Tax implications of carrying on business in Trinidad and Tobago Corporation tax Business levy Green Fund Levy Withholding tax PAYE National Insurance Value Added

More information

Cambodia Tax Profile. kpmg.com.kh

Cambodia Tax Profile. kpmg.com.kh Cambodia Tax Profile kpmg.com.kh Content 1 2 Tax Profile Income Tax Treaties for the Avoidance of Double Taxation 6 Indirect Tax (e.g. VAT/GST) 7 8 Personal Taxation Other Taxes 9 11 Free Trade Agreements

More information

Mexican Tax Law. Value Added Tax (VAT) is assessed on the consummation within the Mexican territory of the following types of transactions:

Mexican Tax Law. Value Added Tax (VAT) is assessed on the consummation within the Mexican territory of the following types of transactions: Mexican Tax Law By: Benjamin C. Rosen brosen@rosenlaw.com.mx Last Update: September 2006 INTRODUCTION Mexican companies (including subsidiaries of foreign companies), as well as permanent establishments

More information

Provinces and territories also impose income taxes on individuals in addition to federal taxes

Provinces and territories also impose income taxes on individuals in addition to federal taxes Worldwide personal tax guide 2013 2014 Canada Local information Tax Authority Website Tax Year Tax Return due date Is joint filing possible Are tax return extensions possible Canada Revenue Agency (CRA)

More information

Income Basic Tax, Otherwise Known as Alternative Minimum Tax ("AMT")

Income Basic Tax, Otherwise Known as Alternative Minimum Tax (AMT) Corporate Taxation System in Taiwan Corporate Income Tax The amount of income of a profit-seeking enterprise shall be the net income, i.e., the gross yearly income after deduction of all costs, expenses,

More information

Tax Consequences for Canadians Doing Business in the U.S.

Tax Consequences for Canadians Doing Business in the U.S. April 2012 CONTENTS U.S. basis of taxation The benefits of the Canada-U.S. tax treaty U.S. filing requirements U.S. taxpayer identification U.S. withholding Tax U.S. state taxation Other considerations

More information

Spanish Tax Facts. The Expatriate Financial Guide to Spain

Spanish Tax Facts. The Expatriate Financial Guide to Spain The Expatriate Financial Guide to Spain Spanish Tax Facts Introduction Tax Year Assessment Basis Taxation in Spain occurs at a national level and at a regional ( Autonomous Community ) or municipal level.

More information

Employee Stock Options, Stock Purchase Rights, Restricted Stock and Restricted Stock Units

Employee Stock Options, Stock Purchase Rights, Restricted Stock and Restricted Stock Units Employee Stock Options, Stock Purchase Rights, Restricted Stock and Restricted Stock Units Argentina Colombia India Mexico Slovak Republic Australia Czech Republic Indonesia Netherlands South Africa Austria

More information

Withholding Tax Rates Used in Net-of-Tax Indexes v2.3

Withholding Tax Rates Used in Net-of-Tax Indexes v2.3 Withholding Tax Rates Used in Net-of-Tax Indexes v2.3 ftserussell.com February 2016 Contents 1.0 Introduction... 3 2.0 FTSE Global Equity Index Series and Russell Global Indexes... 4 2.1 Maximum Withholding

More information

14. Corporate Tax and Depreciation

14. Corporate Tax and Depreciation 14. Corporate Tax and Depreciation Corporate income tax is levied on income from the worldwide operations of Czech tax residents and on Czech-source income of Czech tax non-residents. Czech tax residents

More information

SYLLABUS BASICS OF INTERNATIONAL TAXATION. ! States levy taxes by virtue of their sovereignty

SYLLABUS BASICS OF INTERNATIONAL TAXATION. ! States levy taxes by virtue of their sovereignty SYLLABUS BASICS OF INTERNATIONAL TAXATION! States levy taxes by virtue of their sovereignty! Tax sovereignty, however, is not unlimited. There must either be a personal or an objective connection between

More information

United States Corporate Income Tax Summary

United States Corporate Income Tax Summary United States Corporate Income Tax Summary SECTION 1: AT A GLANCE CliftonLarsonAllen LLP 222 Main Street, PO Box 1347 Racine, WI 53401 262-637-9351 fax 262-637-0734 www.cliftonlarsonallen.com Corporate

More information

FOREWORD. Cape Verde. Services provided by member firms include:

FOREWORD. Cape Verde. Services provided by member firms include: 2015/16 FOREWORD A country's tax regime is always a key factor for any business considering moving into new markets. What is the corporate tax rate? Are there any incentives for overseas businesses? Are

More information

Recent developments regarding Mexico s tax treaty network and relevant court precedents

Recent developments regarding Mexico s tax treaty network and relevant court precedents Recent developments regarding Mexico s tax treaty network and relevant court precedents Mexico has a relatively short background on the negotiation and application of treaties for the avoidance of double

More information

Thinking Beyond Borders

Thinking Beyond Borders INTERNATIONAL EXECUTIVE SERVICES Thinking Beyond Borders Vietnam kpmg.com Vietnam Introduction Tax residents of Vietnam are taxed on worldwide income, whereas non-tax residents are taxed on Vietnam-sourced

More information

1. Changes in PRC withholding income tax provisioning policy in relation to CSI RMB Income Fund and CSI RMB Short Maturity Bond Fund

1. Changes in PRC withholding income tax provisioning policy in relation to CSI RMB Income Fund and CSI RMB Short Maturity Bond Fund 和 CSI Alpha Fund Series (the Trust ) - CSI China-Hong Kong Leaders Fund - CSI RMB Income Fund - CSI RMB Short Maturity Bond Fund (each a "Fund", collectively the Funds ) CITIC Securities International

More information

UNITED KINGDOM LIMITED LIABILITY PARTNERSHIPS

UNITED KINGDOM LIMITED LIABILITY PARTNERSHIPS UNITED KINGDOM LIMITED LIABILITY PARTNERSHIPS Background A United Kingdom Limited Liability Partnership (LLP) has become a very popular vehicle for international commercial activity. This is because the

More information

Saudi Arabia Tax Guide

Saudi Arabia Tax Guide Saudi Arabia Tax Guide I IMPORTANT DISCLAIMER: No person, entity or corporation should act or rely upon any matter or information as contained or implied within this publication without first obtaining

More information

Employment Income Tax in Ethiopia

Employment Income Tax in Ethiopia Introduction Employment Income Tax in Ethiopia Individuals may receive various types of income such as wages or salary from employment, rent from letting houses or buildings, interest from lending/saving

More information

Real Estate Going Global Singapore

Real Estate Going Global Singapore www.pwc.com/goingglobal Real Estate Going Global Singapore Tax and legal aspects of real estate investments around the globe 2012 Real Estate Going Global Singapore 1 Contents Contents Contents... 2 Real

More information

THE TAXATION INSTITUTE OF HONG KONG CTA QUALIFYING EXAMINATION PILOT PAPER PAPER 5 ADVANCED TAXATION PRACTICE

THE TAXATION INSTITUTE OF HONG KONG CTA QUALIFYING EXAMINATION PILOT PAPER PAPER 5 ADVANCED TAXATION PRACTICE THE TAXATION INSTITUTE OF HONG KONG CTA QUALIFYING EXAMINATION PILOT PAPER PAPER 5 ADVANCED TAXATION PRACTICE Advance Tax- pilot_1007_q&a_jy R28/3/2013 1 QUESTIONS Section A Case Answer Question 1 in this

More information

Doing Business in Russia

Doing Business in Russia Doing Business in Russia www.bakertillyinternational.com Contents 1 Fact Sheet 2 2 Business Entities and Accounting 4 2.1 Companies 4 2.2 Partnerships 5 2.3 Branches and Representative Offices 6 2.4 Individual

More information

Annual International Bar Association Conference 2014. Tokyo, Japan. Recent Developments in International Taxation. Portugal. Guilherme Figueiredo

Annual International Bar Association Conference 2014. Tokyo, Japan. Recent Developments in International Taxation. Portugal. Guilherme Figueiredo Annual International Bar Association Conference 2014 Tokyo, Japan Recent Developments in International Taxation Portugal Guilherme Figueiredo Eurofin Capital S.A. gfigueiredo@eurofincapital.com 1. RECENT

More information

TAX CARD 2015 GREECE. Table of Contents

TAX CARD 2015 GREECE. Table of Contents GREECE TAX CARD TAX CARD 2015 GREECE Table of Contents 1. Individuals 1.1 Personal Income Tax 1.1.1 Employment and Pension Income 1.1.2 Income from Individual Practices and Freelance Professions 1.1.3

More information