Shenzhen Government Online
Reporting of indirect asset transfers by non-resident enterprises
From: Shenzhen Tax Service, State Taxation Administration
Updated: 2022-03-11 16:03

Application Requirements

Where there is an indirect transfer of Chinese taxable assets by non-resident enterprises, either party to the transaction or the PRC enterprise whose shares are to be indirectly transferred may report the transfer to the in-charge tax authority.


Legal Basis

Article 9 and Article 10 of the State Taxation Administration (STA) Public Notice on Several Issues Concerning the Enterprise Income Tax on Indirect Asset Transfer by Non-Resident Enterprises (STA Public Notice [2015] No. 7)


Materials Needed

No.

Materials

Qty

Notes

1

Equity transfer contract or agreement

1

If the original document is in a foreign

language, a Chinese

translation shall be

attached. The same

applies to all other

materials.

 

2

The corporate shareholder structure charts before and after the

equity transfer

1


3

Prior two years of financial and accounting statements of the

foreign enterprise and its subsidiary that directly or indirectly

holds Chinese taxable assets

1


4

A statement on whether the indirect transfer of Chinese taxable

assets is made with legitimate business purposes, or to evade

paying enterprise income taxes

1


Documents to be submitted conditionally

Applicable conditions

Materials

Qty

Notes

Required by the competent tax authorities

Information about the decision-making or execution process of the overall arrangement of the

transaction of indirect transfer

of Chinese taxable assets

1


Information on the production

and operation, personnel,

finance, property as well as

internal and external audits of

the foreign enterprise and its

subsidiary that directly or

indirectly holds Chinese

taxable assets

1


Asset appraisal report and

other valuation bases used to

determine the price of the

foreign equity transfer

1


Information on income tax

payable outside China for

indirect transfer of Chinese

taxable assets

1


Evidence qualifying the

application of Articles 5 and 6

of the STA Public Notice [2015] No. 7

1



Notes:

1. Taxpayers are responsible for the authenticity and legality of the materials submitted.

2. Taxpayers are required to submit paper documents when they go to the tax service hall to handle their tax affairs,or submit electronic documents according to the operation requirements of the online system if they handle their tax affairs online or through mobile terminals.

3. For materials not specified as original or printed copies in the “Materials Needed” list, the original copies shall be provided; for materials specified as printed copies, only printed copies shall be provided; for materials specified as original and printed copies, the printed copies will be collected and the original copies will be returned after verification.

4. Taxpayers may use e-signatures that meet the requirements of the Electronic Signature Law of the People’s Republic of China, which has the same legal effect as handwritten signatures or seals.

5. The submitted printed copies must state its consistency with the original copies and be stamped with the company’s official sealor signed by the taxpayer.


Service Channels

1. Tax Service Halls (Click to view the location, opening hours and contact information of the tax service halls)

“City-wide Universal Processing” services willnot be provided at all tax service halls including the Second Tax Bureau of Shenzhen Municipality.


2. No self-service tax terminalis available.


3. Online service

No E-tax bureau, Mobile terminal or WeChat (tax bureau) access is available.


Processing Authority

The competent tax authorities


Processing Time

1. Time limit for taxpayers

N/A.


2. Time limit for tax authorities

The tax authority shallcomplete the procedure immediately after acceptance.


Tel.

Please refer to the tax service map for contact numbers of each tax service hall.


Processing Procedure

税务流程图_3-4.jpg


Processing Result

Tax authorities will give feedback on the processing result.


Notices for Taxpayers

1. The tax authorities provide single-window service. Taxpayers need to visit the tax authorities only once at most on the precondition that the materials are complete and meet the legal requirements for acceptance.


2. The following criteria shall be used to determine the tax authority in charge of the underlying matter:

(1) If the taxable assets being transferred are attributable to an establishment or place in China, the tax authority in charge of such establishment or place shall be the tax authority in charge.

(2) Apart from the circumstance described in Item (1), if the assets being transferred are real property in China, the tax authority in charge of the deducting and withholding obligator or at the place of the real property shall be the tax authority in charge.

(3) Apart from the circumstance described in Item (1) and (2), if the assets being transferred are equity interest investments by Chinese resident enterprises, the tax authority in charge of thewithholding agent or the enterprise being transferred shall be the tax authority in charge.


3. If the equity transferor leads to the indirect transfer of more than two Chinese taxable assets through the direct transfer of equity in the same foreign enterprise, involving more than two competent tax authorities, both parties to the transaction of the indirect transfer of Chinese taxable assets or the PRC enterprise whose shares are to be indirectly transferred may choose which in-charge tax authority to submit relevant reporting materials to, and such competent tax authority shall be responsible for the relevant examination work as prescribed.


4. If the indirect transfer is re-characterized by the tax authorities and confirmed as a direct transfer of equity or other assets of a PRC resident enterprise, the withholding agent and non-resident taxpayer shall withhold or declare the enterprise income tax in accordance with the relevant provisions.


5. If an equity transferor causes indirect transfer of more than two Chinese taxable assets through direct transfer of equity in the same foreign enterprise, which is taxable in accordance with the relevant regulations and involves more than two competent tax authorities, the equity transferor shall declare and pay enterprise income tax at each of the respective competent tax authorities involved.


Fees

Free of charge


Application Forms

N/A.


Instructions for Fillingout Forms

N/A.




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