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Go Tech! 15% Corporate Tax in China for Tech Companies

Dec 26, 2017

It has already become a common fact that the more you go tech - the more you get. The innovation and information technology companies are everywhere and the development of the artificial intelligence, virtual reality and other novelties continues 24/7.

Since 2014, China launched tax privileges for the high-tech firms. These benefits can be applied relevantly easy: the company only needs to file documents to the local authority. What about the upcoming year and the new tax rules? The Chinese government still supports technology, therefore the Ministry of Finance announced a new period for these benefits.

The underlying idea of Chinese tax exemption is the reduction of the corporate tax to 15%. It works in 21 different cities and, as was mentioned above, is preferential only for high-tech firms. The news is that this regime will work for all 2017 corporate tax payments for Mainland companies whose income from the technological services contains more than a half. It is also required to have degree-educated personnel to use this tax benefit. It encourages young people to get the best education and employers to choose the most qualified staff. At the same time, the tax benefit does not apply to companies that use more than 35% of the outsourced activity. Basically, lowering corporate tax to 15% for such companies gives many benefits to the country itself. Before 2008, corporate tax used to be 33%, then it was lowered to 25% and now high-tech firms have even lower rate. Moreover, tech business will receive more benefits for educating staff. Deduction will be up to 8% of the total yearly wage bill and it can be distributed among a couple of years.

Chinese high-tech business policy tempts to encourage more and more international companies to relocate to mainland. Offshorelicense Ltd is ready to help you with the relocation or even set-up a company in China from the very beginning.

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