Jiangsu Clarifies Tax Reduction Procedures for Technology Transfer Income

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Jan. 5 – Based on the State Administration of Taxation’s Circular No.825 and Circular No.212, which clarify the related procedures and qualifications required for an enterprise or individual to receive tax reductions or exemptions from its technology transfer income, the Jiangsu provincial tax authorities announced new procedures for regional entities applying for tax preferential treatment regarding technology transfer in a circular issued on November 26, 2010.

The “Circular on Administration of Tax Preferential Treatment in Relation to Technology Transfer” (Sudishuigui [2010] No.9) gives the following guidelines to obtain the preferential taxation treatment.

  • An enterprise or individual that is eligible for business tax exemption and corporate income tax reduction on income from its technology transfer, development, and related technology consultation as well as services shall present the technology contract registration certificate given by a provincial-level science and technology authority when going through record-filling procedures with the in-charge taxation authority.

Circular No.9 takes effect from January 1, 2011.

Dezan Shira & Associates are a licensed tax practice in China. Please contact the firm at tax@dezshira.com if you have concerns in this area, or download the firm’s brochure here.

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