Tax advisory, planning & investigation services.

Whether you require advice on tax opportunities or to resolve tax compliance or tax investigation issues, we are here to help.

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Tax advisory & planning in Indonesia

Reduce your taxes & boost business profitability.

Your tax system optimised

We will help you minimise your tax liabilities in China by optimising your current tax structure, including tax health checks, identifying and mitigating tax inefficiencies and leaks, eliminating the risk of double taxation and more.

Identifying new opportunities

Each country’s tax environment is intricate and you could be paying more than you need to. Our tax experts will help you reclaim your profits by making the best of available tax concessions, cash repatriation and incentives systems.

Strategic tax planning

For those making significant transactions or dealing with business expansion to emerging markets in Asia, our team can provide the necessary tax guidance for performing them tax-efficiently.
Corporate & personal tax advisory

Our tax advisory services.

Corporate tax.

  • Tax planning, structuring and optimisation

    Our tax advisors can examine transactions that your company is proposing and advise on the optimal way of executing it from the China tax perspective. This includes advising you on restructuring your business models to strengthen the validity of the claim, making use of specific tax rules to lodge deduction claims on their capital expenditure and providing ways to minimise tax liabilities according to the tax law legally.

  • Transfer pricing (TP) advisory

    Where your company is involved in the import/export of goods and services from related parties, our tax experts can provide you with a transfer pricing report. It will analyse the correct method of pricing your products and services and include a comparability analysis with other similar transactions in the market.

    The PRC government has adopted international practices to govern transfer pricing based on comparable uncontrolled transaction principles, such as the OECD and US methodologies. Using these as guides, Chinese regulations stipulate that inter-company transactions, and transactions between ‘associated entities’ should be priced using “arm’s length principles”. Given the limitations with tax appeals in China, avoiding a tax dispute is critical and correctly documenting your transfer pricing strategies is becoming ever more important. Acclime’s tax experts will advise on remaining compliant.

Reduce or avoid tax compliance issues
and let us resolve initiated investigations.

  • Tax compliance opinion

    Our tax team can advise you on potential issues your business may face, and propose how compliance is best achieved. We will consider all aspects of your business activities to suggest how to make your business tax compliant within a changing legal environment. The scope of our consultancy includes our tax experts reviewing your value-chain and considering any onshore or offshore investments.

  • Tax or Customs investigations

    The China tax bureau may instigate a tax audit of your company through an investigation team at either local or provincial level. There are many reasons why they might do this. Acclime has extensive experience in dealing with the China tax officials to help you in preparing for a tax audit and handling queries from the officials on your behalf, if needed with assistance of our trusted network. Having a representative who understands what an auditor is after is important for ensuring that the audit will go smoothly and efficiently.

    We also recommend and assist with a tax-risk assessment to identify areas that can be improved to head off an audit. Common duties and tax compliance issues include under declaration of individual income taxes, using a lower salary base for social insurance contributions, not paying tax over bonuses, not declaring China-sourced income received overseas, fake fapiaos, double deductions, off-books income, shadow books, booking China-sourced revenue overseas, employing foreign employees without work permit, under-declaring the value of imported goods, and using incorrect or wrong HS codes.

    From an internal perspective, tax audits are important to make sure you and your company meet strict government requirements. Acclime’s tax audits can also help remove inefficiencies from your current tax structure. Externally, tax audits show the world that your company is efficient and effective and that the profits that you are reporting can actually be trusted. Trust is a valuable asset in today’s rapidly changing market and should never be undervalued.

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Single time- or project-based fee

Personal tax.

  • Personal tax advisory & planning

    In personal tax return preparation, we help identify the allowances and deductions you as an individual or your employees are entitled to and make sure they are included in returns in the most tax-efficient way. It includes:

    • Tax implications of all types on income and share incentives received
    • Structuring of remuneration packages in a tax-effective manner
    • Advice on objections and appeals to income tax assessments

    There are complex regional and national tax rules within China, which often vary between locations. Along with this, expatriates also need to be concurrent on employment visa requirements before entering the workforce. Employees that have been required to live away from their domestic country are also entitled to various benefits. Taking all this into account, the correct structuring of these benefits as part of a compensation package can result in significant tax savings. Acclime can help employers and employees through the processes of the Tax Immigration & Investment Review process. Years of experience, in depth training and the continual tracking of legislation ensures we are up-to-date regarding the rapid changes, and our review includes:

    • US & Overseas Personal Income Tax Planning & Filing
    • IIT Tax Payment Facilitation
    • Application For Individual Income Tax Refund
    • Expatriate Staff Individual Income Tax Staff Filing
    • Local Staff Individual Income Tax
    • Company Taxation (CIT) filing

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FAQ

Common questions.

What obligations are placed on FIEs by the Transfer Pricing Notice?
China adopts stringent requirements on filing related party information. Tax payers are required to file annual related party transaction reports as part of their annual CIT filing package before May 31st of each year. In addition, enterprises are required to prepare TP documentation in place for inspection upon request by Chinese tax bureaus. Enterprises meeting certain conditions are exempt from such requirements.
What are the aspects of the framework for the administration system for the taxation of transfer pricing as stated in the Transfer Pricing Notice?
The Transfer Pricing Notice lays down the framework for a highly efficient administration system for taxation of transfer pricing. The key elements include competent specialist audit teams to inspect the transfer pricing aspects of foreign enterprises’ transactions and a database for administration of transfer pricing using information gathered from other government authorities such as the respective Administration of Industry and Commerce, PRC customs authorities and banks. In addition, departments dedicated to the tax administration of transfer pricing will be established within tax authorities in areas where Foreign-Invested Enterprises (“FIEs”) are concentrated.
Do companies in China normally have Advanced Pricing Agreements (APA)?

It depends on the complexity of explaining the manner in which a company does its pricing. If many complex issues are involved, then perhaps a company will need to have an APA in place. It also depends on the respective local tax authorities and their expertise in this area. If the local authorities are not well versed in this area (which undoubtedly is highly specialised), then it is futile investing time and effort to put together an APA.

* (An APA is an agreement between the tax authorities and the taxpayer, setting out the method of transfer pricing policy for controlled transactions over a fixed period of time.)

What are the consequences for late payment of income tax?

Under the Law of the PRC for the Administration of tax levying (amended in June 2013) and the Measures for the Administration of Tax Registration (effective from February 2004), the taxpayer should register with the local tax authorities within 30 days of receiving its business license.

The payment of enterprise income tax on a monthly or quarterly basis should be determined by the taxation authority in accordance with actual situation and have the actual income tax amount settled within five months of the tax year ending. A late payment fine of 0.05% of the outstanding amount per day may be added to the taxpayer’s balance in addition to the back taxes owed. The clock will start ticking for the fine from the day the taxes were due.

How does the PRC tax authorities secure the payment of income tax?
In general, 22% for 2020 and 2021, and 20%

If a taxpayer fails to pay its tax on time, they should be given a deadline for squaring it up with the tax authorities. As an enterprise engaged in production, if the taxpayer fails to make the payment by the specified deadline, the tax authority may (subject to the approval by the head of a tax bureau at county level or above):

  • Order the taxpayer’s bank to withhold from the taxpayer’s accounts the amount due plus any surcharge for overdue payment
  • or
  • Seize and sell other assets belonging to the taxpayer equivalent to the value of the amount due plus any surcharge for overdue payment.

In addition, under Article 63 of the Tax Collection Law, the tax authorities can possibly impose a fine of up to five times the unpaid or underpaid amount.

Who is responsible for the penalty an expatriate employee incurs for late payment of income tax?

Normally, the FIE would be the withholding agent of the expatriate employee’s tax. This means it has the obligation to withhold and pay the income tax directly from the expatriate employee’s salary within the first fifteen days of each month. As the withholding agent, the FIE is liable if the tax has not been withheld or collected and would thus be lumbered with the late payment fine or other fines imposed. On the other hand, if the expatriate employee’s salary was paid by the parent company in Hong Kong, the expatriate employee would himself by responsible for the payment of tax on his salary. Either way, PRC tax authorities will go for the easy target when chasing the expatriate employee’s tax payment, which normally is the FIE, as they have a fixed presence and assets in China.

How the FIE is going to retrieve the tax payments from the expatriate employee is of no concern to the Chinese tax authorities!

Is it possible to obtain an extension for payment of income tax?
The expatriate employee is under an obligation to file a tax return and submit relevant tax information with the tax authorities. Alternatively, the FIE, as the withholding agent, is obliged to submit a report and pay the withheld taxes within the specified period. The tax authority may grant an extension to a taxpayer or withholding agent who is unable to file a tax return or report on time. An extension of tax payment may also be offered to a taxpayer with “special difficulty” in paying taxes. The extension can only last as long as three months.
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