China's tax regulations offer a significant incentive for businesses through the one-off deduction policy for fixed assets. This policy allows companies to deduct the full cost of eligible equipment and tools from their taxable income in a single year, rather than depreciating the assets over multiple years. The policy applies to fixed assets other than houses and buildings, with a per-item value not exceeding RMB 5 million (approximately US$702,000). Initially set to expire at the end of 2020, the policy has been extended through December 31, 2027, providing ongoing tax relief for enterprises.
Key Considerations:
Optional Application:Â Businesses can choose whether to apply the one-off deduction based on their financial strategies.
Timing of Deduction:Â The full pre-tax deduction should be applied in the fiscal year following the month the asset is put into use.
Compliance Requirements:Â Proper documentation and accurate tax filings are essential to benefit from this policy.
How Woodburn Can Assist:
Navigating China's tax landscape requires expertise and strategic planning. Woodburn Global offers comprehensive services to help businesses optimise their tax benefits, including:
Tax Advisory:Â Providing insights into applicable tax incentives and how to leverage them effectively.
Compliance Support:Â Assisting with accurate tax filings and ensuring adherence to regulatory requirements.
Strategic Planning:Â Developing tailored strategies to maximise tax savings and enhance financial performance.
For expert guidance on utilising China's one-off deduction policy and other tax incentives, book a call below.
Woodburn Accountants & Advisors is one of China’s most trusted business setup advisory firms.
Woodburn Accountants & Advisors is specialized in inbound investment to China and Hong Kong. We focus on eliminating the complexities of corporate services and compliance administration. We help clients with services ranging from trademark registration and company incorporation to the full outsourcing solution for accounting, tax, and human resource services. Our advisory services can be tailor-made based on the companies’ objectives, goals and needs which vary depending on the stage they are at on their journey.
Talk to an expert
Schedule a 30-mins complimentary, no-obligation call to see how Woodburn can help you. Book a call with our Head of Business Advisory - Kristina Koehler-Coluccia.
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Topics we can advise on include:
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Company Registration
Cloud Accounting & Financial Reporting
Cloud Payroll Services
Tax & Audit Services
Recruitment
Employer-of-Record
Visa Application
Trademark Registration
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Our advisory calls are available from Monday-Friday from 8am to 5pm CEST and Wednesday until 9pm CEST.
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