Doing Business in Hong Kong and China: The Complete Guide for International Companies
Article summary Hong Kong and mainland China are two major markets for companies looking to expand their business in Asia. They are geographically close, but their legal, fiscal and administrative functioning is very different. Hong Kong has a territorial tax system, does not levy VAT or sales tax, and has a relatively simple system for […]
China Tax Compliance: Why Contracts, Invoices and Accounts Need to Match
Why does consistency matter for China tax compliance? One of the most common sources of unnecessary tax and compliance difficulty is inconsistency. A contract may describe one commercial arrangement, an invoice may show something different, and the accounting records may reflect the transaction in another way. When these records do not align, explaining the transaction […]
Accounting in China: Why Local Records and Group Reporting Need to Align
Why do local accounting and group reporting need to work together? For an overseas-owned business operating in Mainland China, accounting often needs to serve two different audiences. The local operation needs reliable day-to-day financial records, while an overseas parent company, owner or investor may also need management information that fits wider group reporting requirements. The […]
Hiring in Mainland China: Payroll, IIT and Social Insurance Basics
What should businesses consider when hiring employees in Mainland China? Hiring in Mainland China involves more than agreeing a salary. Businesses may also need to manage Individual Income Tax withholding, social-insurance contributions, employee records, payroll reporting and local filing requirements. For an overseas business building a China team for the first time, these processes should […]
China VAT and Fapiao: What Overseas Businesses Need to Know
How are VAT and fapiao connected in China? China uses Value-Added Tax, or VAT, and VAT compliance is closely connected to accounting records, tax filings and invoice documentation. For international businesses, one of the most important China-specific terms to understand is fapiao — an official invoice used within the Chinese tax and accounting system. VAT […]
WFOE, Joint Venture or Representative Office: Choosing a China Market-Entry Structure
Which structure should a foreign business choose when entering Mainland China? Choosing how to establish a presence in Mainland China is one of the first major decisions for an international business. Common options may include a wholly foreign-owned structure, a joint venture or a representative office. Each serves a different purpose, and the most suitable […]
Entering Mainland China: What Should Businesses Consider First?
What should businesses consider before entering Mainland China? Entering Mainland China can create significant opportunities for international businesses, but market entry involves much more than registering a company. Before setting up operations, businesses should consider how their company structure, tax position, VAT, payroll, accounting and reporting requirements will work together. Making these decisions early can […]