CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. China Relaxes Tax Break Compliance For Small Businesses

China Relaxes Tax Break Compliance For Small Businesses

by Mary Swire, Tax-News.com, Hong Kong

23 April 2014


China's State Administration of Taxation (SAT) has released simplified procedures for those micro- and small-sized enterprises that wish to take advantage of the additional tax cuts agreed by the Ministry of Finance (MoF) on April 8, 2014.

Within a package of measures to underpin the country's economic growth rate, the MoF had then confirmed that micro- and small-sized enterprises, previously defined as those with an annual taxable income of less than RMB60,000 (USD9,635), would now include all those with incomes up to RMB100,000, with effect from January 1, 2014.

That significantly expands the firms eligible for the existing tax break, whereby the the calculation of their taxable income is reduced by 50 percent. Only companies whose taxable income exceeds this threshold are subject to tax at the normal 20 percent corporate tax rate. In addition, the tax break – originally scheduled to end on December 31, 2015 – has also been extended for a further year to the end of 2016.

To underpin the original motivation behind the tax break of helping small companies to manage with rising costs, SAT has now also announced, in order to reduce their compliance costs, that eligible businesses will be able to take advantage of the measure without obtaining SAT's prior approval.

In effect, an SAT statement disclosed that firms will only have to inform their local tax office of their financial situation, without the provision of complete accounting records at that time, and that final settlement will be made following year-end tax return filing. In addition, those eligible firms that had paid full income tax before April 8 will be able to obtain refunds of the overpaid tax.

China's measures to stimulate the growth of micro- and small-sized enterprises are seen to be important given that these entities were said, at the end of last year, to total 11.7m, and account for more than 75 percent of the total number of businesses in the country.

TAGS: compliance | Finance | tax | small business | business | tax compliance | corporation tax | China | tax rates | tax breaks | micro business | Tax

To see today's news, click here.

Leave a comment

Read our Posting Guidelines

 






Close

Password Reminder

Please enter your email address to receive a password reminder.

 

Log into Tax-News+
Not registered yet? Find out about our daily news alert service »

 Email: 
 Password: 

Login »

Forgotten your password?







Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Tax-News+ Updates

Receive FREE daily updates from Tax-News.com, straight to your inbox. Register Now!

For a tailored solution, choose to receive selected news updates for your preferred jurisdictions and topics, with our enhanced Tax-News+ subscriber service. Read more...

 

Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »