Important Changes to IIT and Annual Bonuses for Foreigners in 2022, New Annual Audit Magazine is Out, Historical Resolution at the Sixth Plenum, and more

Beijing Further Opens Service Sectors to FDI, Investment Opportunities in Autonomous Driving and Vocational Training, and more Beijing Further Opens Service Sectors to FDI, Investment Opportunities in Autonomous Driving and Vocational Training, and more

Alberto Vettoretti Managing Partner Hello Navneet,   With the year coming to a close, we would like to remind you of the upcoming changes to tax exemptions on benefits-in-kind for foreign employees in China starting January 1, 2022. This policy change will have a major impact on the net take-home pay for certain expats. In addition, the tax calculation method for annual one-time bonuses will also change for some taxpayers. If you have any question regarding the upcoming changes, please contact our experts.   Year end is also a perfect time to plan for China annual compliance work. See our latest China Briefing magazine, Annual Audit and Compliance: Get Ready for 2022, join our upcoming audit webinar on November 25, or our Ready for 2022: Health Checks for a Compliant, Risk Controlled, and Efficient Business webinar on November 30 to get started.     China's much anticipated 'Sixth Plenum' just concluded with the passing of a "historical resolution". We provide insight into what happened and why it matters to give you an understanding of this significant development.   In addition, we have selected three sample projects from our M&A matchmaking portal asiamerger™, featured by our experts. You can also list a sell-side project or search buy-side projects for your M&A needs.    Lastly, if you are planning to relocate your manufacturing operations to a new market, do read our two new case studies below. Here, our Business Intelligence team explains the importance of a cross country competitiveness benchmarking to make an optimal relocation decision.   If you need any support, please do not hesitate to contact us. SPECIAL SPOTLIGHT: TAXPEDIA China Annual Bonus: Prepare for 2022 Income Tax Policy Change The preferential income tax treatment for the annual one-time bonus for some tax residents in China will end on January 1, 2022, as the tax policy transition period comes to an end. Other changes include ending the individual income tax exemption for some fringe benefits for expatriates. Employers and employees should be clear about the coming changes and make adequate preparation to reduce extra tax burden.   READ MORE Tax Implications for Chinese Permanent Residence ID Card Holders Many foreigners have concerns over getting a Chinese Permanent Residence (PR) ID Card as they are not sure whether this will impact their tax residency status in China, or whether they will be liable to pay tax on worldwide income in the country. We discuss the tax residency status of foreigners with a Chinese Permanent Residence ID Card and their tax liability on worldwide income in the country. READ MORE Companies with Equity-Based Compensation Plans are Subject to More Reporting Obligations in China China has tightened the tax administration of income derived from equity-based compensation plans. Companies that implement equity-based compensation plans are now required to submit a reporting form on the status of the equity incentives, as well as other documents, to the tax authorities in charge.       READ MORE INVESTOR UPDATES The Sixth Plenum: What is it and What Has Been Decided? Nearly 350 members and alternate members of the CCP Central Committee have gathered in Beijing since November 8 to review the Resolution on Major Achievements and Historical Experience of the CPC's 100 Years of Endeavors, which has been touted as being of "historical significance" and is only the third such resolution since the CCP's foundation 100 years ago.     READ MORE Cross-Border Data Transfer – New Draft Measures Offer Clarification on Security Review The Cyberspace Administration of China has released draft measures detailing requirements for security reviews for cross-border data transfer. The draft measures offer clarity on the governmental body responsible for overseeing security assessments and what procedures companies must undergo to get clearance to transfer data overseas. READ MORE Beijing's Services Sector Opens More Areas to Foreign Investment China's capital received the green light from the State Council to further open parts of the Beijing service sector to foreign investment. The affected industries include areas that were previously off-limits, such as education, telecommunications, construction, performing arts, and more. We discuss what impact this could have on foreign investors.       READ MORE China Public Holiday 2022 Schedule Released Foreign human resource managers should note that Saturdays and Sundays are often marked as additional official workdays in China to compensate for long holiday breaks.           READ MORE China's Autonomous Driving Industry – An Introduction for Foreign Investors In this article, we take a look at the development outlook, government regulations of China's Autonomous Driving Industry, and which areas of the industry are open to foreign investment.       READ MORE China's Vocational Education Reform and Foreign Investment Opportunities Although China is tightening regulations on academic tutoring for school-age students, it is simultaneously encouraging private investment in vocational education. Foreign investment is explicitly welcome in the vocational education sector. READ MORE UPCOMING EVENTS China's FY2021 Annual Audit: What's New and How to Prepare? Webinar | Thursday, November 25, 2021 | 4:00 PM China / 3:00 PM Vietnam / 9:00 AM CET   As the year comes to an end, companies and their finance teams will be busy closing their accounts and preparing for their annual audit. For small and medium size companies (SMEs) with limited manpower, this will be an especially busy time of the year.   Join us as Audit Manager, Jess Feng, introduces the general auditing process and what you need to do to prepare for your upcoming financial audit. Jess Feng Manager, Audit Team China REGISTER NOW  Ready for 2022: Health Checks for a Compliant, Risk-Controlled, and Efficient Business   Due to unforeseen circumstances this webinar will be postponed to Tuesday, Nov 30, 2021.   Webinar | Tuesday, November 30, 2021 | 5:00 PM China / 4:00 PM Vietnam / 10:00 AM CET   A common method to assess the "health" of a business is to perform the audits and checks required by PRC law, however, additional "health checks" can be used to further protect your business.  These internal or external "health checks" can help firms identify and prevent possible non-compliant operations and risks.     In this webinar, Viktor Rojkov, International Business Advisory Senior Associate, will discuss the current business environment in China in terms of compliance and risks, and highlight common situations in which companies should perform a "health check."  Viktor Rojkov Senior Associate, International Business Advisory China REGISTER NOW  Tax Incentives in China: How Businesses Can Successfully Utilize Them? Webinar | Thursday, December 2, 2021 | 4:00 PM China / 3:00 PM Vietnam / 9:00 AM CET   Tax incentives in China are a common method of encouraging investment in particular industries or regions and are often offered through Corporate Income Taxes (CIT).  Certain industries and cities may have a lower CIT and give business a preferential CIT rate.  Tax incentives that nurture and encourage post-COVID economic growth are a key pillar for Chinese economic and employment recovery.   Hannah Feng, Partner at Dezan Shira & Associates, will discuss the current tax incentive policies and local implementations with a focus on the high-tech industry and specific regions in China such as the Greater Bay Area (GBA), Hainan Free Trade Port (FTP), and certain areas in Beijing.   Hannah Feng Partner China REGISTER NOW  Managing Non-Trade Intercompany Transactions with Your Chinese Affiliates Webinar | Wednesday, December 15, 2021 | 4:00 PM China / 3:00 PM Vietnam / 9:00 AM CET   In this webinar, Riccardo Benussi, Head of European Business Development, Shirley Chu, manager from our transfer pricing team, and Ann Sun, manager from our corporate accounting team will discuss the difficulties faced by multinational companies in terms of non-trade cross-border intercompany transactions and how they could be affected by China's transfer pricing policy, along with the tax implications and payment procedure of some common forms of such transactions. Cindy Yin, operation manager of BNI China will join us as a special guest to share her experience in cross-border royalty payments and service charges. Riccardo Benussi Head of European Business Development Germany/Italy Shirley Chu Manager, Tax China REGISTER NOW  Ann Sun Assistant Manager, Corporate Accounting Services China NEW PUBLICATION Annual Audit in China   With the scope and penalties of China's social credit system being further clarified in 2021, legal and regulatory compliance has become more important than ever. More attention should be given to the annual compliance procedures as mandated by various governmental departments. In this issue of China Briefing magazine, we walk foreign businesses through the annual audit and compliance process from start to finish. READ MORE CASE STUDIES - FOCUS ON BUSIENSS INTELLIGENCE Using Cross Country Competitiveness Benchmarking to Identify Your Next Business Move   When expanding to a new market or relocating manufacturing operations to a new country, there are many factors for companies to consider in order to position themselves for success.    See two new case studies developed by our Business Intelligence team to understand how cross country competitiveness bechmarking can help your company.    Improving Competitiveness in Asia Manufacturing: Cross-Country Benchmarking for Relocation by a US Hydraulics Manufacturer   An American hydraulic systems component manufacturer wanted to investigate the feasibility of moving their manufacturing operations from China to an alternate location in Asia. Through a multi-country feasibility study, they were able to select an optimal relocation destination, reduce operational costs and tariff exposure, mitigate trade war risks, and obtain more direct control over the manufacturing process. READ MORE Building Supply Chain Resilience in Asia: Country Competitiveness Benchmarking by a European Textile Manufacturer   A European textile company with a manufacturing presence in China, planned to relocate their manufacturing unit to a more cost-competitive country in Asia. Through a multi-country feasibility study of eight South and Southeast Asian countries, they were able to find the most optimal choice from a cost and operational perspective. READ MORE ON-DEMAND WEBINARS Will China's CPTPP Application Succeed & How Would that Impact US Trade Policy? How to Protect your Intellectual Property in China: A Comprehensive Guide How BEPS 2.0 Is Reshaping The Global Tax Landscape For Multinational Enterprises In Asia Know Your Chinese Partners: Case Studies for De-Risking and Managing Your Business Investing & Doing Business in Foshan – Industrial Upgrade and Automation in the GBA CONNECT WITH US ON WECHAT Never miss an update. Scan the QR code to follow our official WeChat account to discover the latest China Briefing articles, upcoming events, webinar recordings, company news and more. asiamerger™ PROJECTS Renowned asset management company in India seeking foreign investors One of the most renowned and oldest family held Asset Management companies based in New Delhi is looking for foreign investors aiming at sustainable and healthy returns for its equity fund.               VIEW OR ENQUIRE Singaporean held organic fish-based fertilizer manufacturer seeking minority shareholder for growth The company targets to sell 20% to 30% to an investor that can support it growth ambitions. The company is a producer of processed seafood and organic fish-based fertilizers used for land-based farming. To grow the fertilizer business the company intends to sell a minority stake to a strategic investor.  VIEW OR ENQUIRE A European flowing-water power mini hydroelectric plants company is seeking buyers A European flowing-water power mini hydroelectric plants company is seeking buyers. The company is looking for a consideration of about € 2.450.000 to transfer the equity, as one of its associates wants to exit the business.           VIEW OR ENQUIRE READ OUR PUBLICATIONS FROM ACROSS ASIA Contact us | Unsubscribe | Services  | Terms | Privacy © 1992-2021 Dezan Shira & Associates All Rights Reserved.

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