Malaysia Hotline : +603-2141 8908
A representative office is an office established by a company to conduct
marketing and other non-transactional operations, generally in a foreign
country where a branch office or subsidiary is not warranted. Representative
offices are generally easier to establish than a branch or subsidiary, as they
are not used for actual "business" (e.g. sales) and therefore there
is less incentive for them to be regulated.
Functions of China
Representative Office
1. It can handle market research, sourcing, project investigation,
quality control for parent company, liaison with customers and suppliers
2. It cannot enter into purchase/sales contracts and receive payment for
services, issue invoices.
3. A RO can open bank accounts and employ staff for above- mentioned
purposes.
4. Apply for work permit and residence permit.
5. A RO is still subject to tax liability, so monthly tax return should
be carried out regularly.
6. If a RO is set up in Shanghai, it is qualified to get a car without
entrance tax.
Process of China
Representative Office set up
Business Follow Up of
China Representative Office （RO）
TANNET can provide a series of business follow-up services such as
transfer RO to WFOE, monthly bookkeeping and tax return, annual return
services, internal auditing, financial planning and tax layout, China policy
& market study. Other services include domain name registration, webpage
design, website promotion, China trademark registration, Work Permit, Residence
Permit, etc. in order to pave a smoother and wider way for your China business
success.
Taxation for China
Representative Office （RO）
Although a China RO is not to conduct business, it attracts tax as stated
below:
1. Individual Income Tax (IIT)
IIT stands for Individual Income Tax which rates from 5% to 45% based on
salary income exceeding more than RMB2000 for local employee and RMB 4800 for
overseas employee. All the RO staff is subject to IIT if his income exceeds the
limit. IIT is calculated according to such a formula: IIT= (income- limit)*
rate.
2. Business Tax (BT)
BT stands for business tax which is based on monthly business operational
expense, the rough rate is 5% based on your expenses. It is calculated
according to the formula like this: BT= expenses/ (1-15%) ×5%.
3. Enterprise Income Tax (EIT)
EIT stands for enterprise income tax which is based on quarterly business
operational expenses, the rate is 25%. It is calculated according to the
formula: EIT = expenses/ (1-15%) ×10%×25%.
Advantages of China
Representative Office (RO)
Using a representative office as China entry form has the following
advantages:
1. Affordable: no paid capital required, government and service fees are
usually lower than what is needed for WFOEs.
2. Quicker registration process (usually within one month or so)
3. Less paperwork required for application (compared to wholly foreign
owned enterprises)
China Representative Office （RO）is a good way for foreign investors since no paid up capital and the easy
process. Tannet could assist the investors to set up the Foreign Invested
Partnership Enterprise (FIPE), Wholly Foreign Owned Enterprise (WFOE), Joint
venture (JV) and so on. Kindly contact us for more information if you are interested on our other services.
Contact us
If you have further
queries, please contact Tannet
24 hours Malaysia hotline：603-21418908;
24 hours Hong Kong hotline：852-27837818;
24 hours Shenzhen hotline：86-755-
36990589;
Email: mytannet@gmail.com
TANNET
GROUP : http://www.tannet-group.net, http://en.tannet.com.my