General tax payer and small taxpayer for China company

General tax payer and small taxpayer for China company

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Generally there are two type of taxpayer in China, one is called small taxpayer which is automatically obtained when you get tax license.  Another is general taxpayer which is you need to prepare documents to apply for it.

The following table details the taxpayer status designated to different entities:

Changes to terms of VAT general taxpayer status applications
Taxpayers or entities who fit the requirements for general taxpayer can register with the relevant tax authority.  As shown in the above table, an exception is made for pilot scheme taxpayers whose annual taxable sales amount, prior to implementation of the VAT reform pilot scheme, does not exceed RMB 5 million. Those taxpayers are able to register as a general taxpayer, given they implement proper accounting methods and are able to provide tax information accurately for application.

It must be noted that once general taxpayer status has been obtained, the transition back to small scale taxpayer is not possible, unless otherwise stipulated by the SAT. Pilot scheme taxpayers who obtained general taxpayer status prior to implementation of the VAT reform pilot scheme are not required to register for general taxpayer status again.

Conclusion
China’s tax system is evolving rapidly and, as a result, can prove hard to navigate for foreign companies. It is important for companies to be aware of the risks associated with non-compliance, to know what category of taxpayer they fall into, and what advantages they have by gaining general taxpayer status.

Contact us for more information:

If you have further queries, don’t hesitate to contact ATAHK anytime, anywhere by simply visiting ATAHK’s website www.3737580.net , or calling 86-755-82147392，86-755-82143512 or emailing to info@citilinkia.com.