Corporate Taxes in China
How and What kind of taxes to pay once your business is up and running?
- Individual Income Tax
a progressive tax imposed on dividends levied by the company partners and the tax on workers’ salaries. It is only required of international workers making more than RMB 5,000 a month. - Value-Added Tax
in every stage of the supply chain, from production to sales, as long as the value-added, the product is subject to value-added tax. China’s VAT is usually 17%, with a low tax rate of 13%. - Corporate Income Tax
a tax on profits (or the gross income less the company expenses) of 25%. There exist however various ways to get a tax reduction on profits. For example, if your industrial sector is “encouraged”, you only pay a 15% corporate tax. For more information, you can consult NIKO. - Turnover Tax (or Transaction Tax)
A tax on sales that can vary between 3% and 5%, depending on the type of business. There is an exception for entertainment firms, for which this tax can vary between 5% and 20%
Taxes on goods imported or exported from China.
There are various ways to get a reduction or exemption from duties. For example, if your company is in a Free Trade Zone.