In 2019, China lowered many taxes, so now we enjoy probably the lowest taxes in the world. This video main topics as follows:
1. Types of taxpayers in China:
There are two main types of taxpayers in China- general taxpayers and small-scale companies. The main difference between them is the amount of annual taxable income. In first case, it accedes 3 million yuan, and in second case, it is less than 3 million yuan.
Main taxes in China:
1) VAT (Value added tax). The VAT is paid every time the goods or services are sold within China. VAT tax rate in China varies from 3%-13%.
2) Corporate income tax. There are three tax rates for corporate income tax in China: 5%, 10%, and 25%.
3) Personal income tax (salary tax). The personal income tax in China varies from 3% to 45%. The tax-free minimum for salary in China is 5,000 yuan, so if your salary is 6000 yuan, your personal income tax is only 30 yuan.
4) Social insurance. The social insurance in China is obligatory only for the local Chinese employees, and is still optional for foreigners.
5) Other taxes. There are also other taxes in China that company pays, but those tax rates are extremely low.
2. Company expenses in China- which kind of expenses are considered as a company expenses and how to arrange it correctly.
3. Kind of invoices generally seen in China.
1) Cash drawer check (小票). The China tax bureau does not accept those checks.
2) VAT invoice (发票). There are two types of VAT invoices in China, and both of them are accepted by the China tax bureau.
3) Fixed amount VAT invoices. They are also quite popular in China and in Chinese they are called 定额发票. This kind of invoices are also accepted by the China tax bureau.
4) Receipt. In Chinese it is called 收款收据. The China tax bureau doesn’t accept them.
4. Bookkeeping and accountancy in China.
If you want to keep your company accountancy in order, every month you should collect VAT invoices issued to your company, and the VAT invoices issued by your company, and give it to your accountant. The accountant will submit them to the tax bureau and file to the account book.
Collecting different VAT invoices may help to decrease or avoid corporate income tax, and shows that your Chinese company has some activity, which is important for foreign invested companies in China.
If you need one of the following services in China, Xiamen city, you are welcome to contact me via email (i@yufu.net) or WeChat (WhiteLily2210):
1) Foreign invested company formation;
2) Changes in your Chinese company: address, name, shareholder, business scopes and other changes;
3) Long term work permit full process, when you have a diploma;
4) Long term work permit full process, when you don’t have a diploma;
5) Short term work permit full process;
6) Work permit transfer process, when you change an employer;
7) Work permit extension;
8) Document translation into Chinese language.
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