By Eunice Ku and Shirley Zhang
May 15 – For foreigners doing business in China, tax is always a key concern. As a foreign business or individual, income derived from China may be subject to taxes in both your home country and China, which could substantially increase your tax burden.
Under China’s Corporate Income Tax (CIT) Law, a non-resident enterprise (i.e., an enterprise organized outside of China and whose effective management is not within China) without an establishment or venue in China is subject to CIT at a withholding rate of 10 percent on their China-sourced income, which includes:
- Income from property transfers;
- Income from equity investment such as dividends and bonuses;
- Income derived from interests, rentals and royalties;
- Income derived from donations; and
- Any other income. Continue Reading