The latest from China & Hong Kong

Alongside dividends, many foreign groups move value out of a Chinese subsidiary through royalties for the use of trademarks, patents, proprietary technology or copyrighted material. Structured correctly, royalty payments are deductible business expenses for the Chinese entity, which makes them an attractive complement to dividend planning. Structured carelessly, they attract close scrutiny from both the tax authorities and customs. How the tax sits Royalties paid to a foreign

Profit that looks healthy in a WFOE's management accounts cannot leave China on request. It has to survive a completed annual audit, a settled tax position, and a foreign exchange filing before a bank will process the remittance. Founders who leave this planning until they actually need the cash often find that years of intercompany invoicing and undocumented transactions become the obstacle. Before any dividend can be declared, the company must have made good any prior year

A wholly foreign owned enterprise in China does not cease to exist because it stops trading. Until it is formally deregistered, it continues to carry tax, accounting, annual reporting, banking and corporate record obligations, whether or not it has any active business. Closing a WFOE properly is a legal process involving several government authorities, and treating it as an administrative formality is one of the more expensive mistakes a foreign investor can make. Since SAMR

China withholding tax affects dividends, interest, royalties, and service payments. Learn the rates, treaty relief, filings, and controls investors need.

WFOE vs joint venture: compare control, market access, liability, approvals, and long-term operating demands before forming a mainland China company.

Contractor versus employee classification affects payroll, tax, benefits, and risk. See how Hong Kong and China businesses can hire with confidence today.

Learn how to close China company operations compliantly, from board approvals and tax clearance to employee settlement, liquidation, and deregistration.

Every company in China, foreign-invested ones included, runs on an annual compliance cycle that is more demanding than many founders expect. It is not a single tax return. It is an audit, a reconciliation of the year corporate income tax, and a set of annual filings, all falling within a defined window early in the year. Miss the window and the company standing suffers in ways that are slow and awkward to repair. The three things that happen each year The annual cycle bundles

Accounting software has become genuinely good, and it is tempting to conclude that a small China entity can run its finances on a subscription alone. Software handles the mechanical parts well. What it cannot do is exercise judgement, take responsibility, or deal with the authorities on the company behalf. Those are exactly the things a China finance function most needs, and they are why an appointed finance manager remains valuable even for a lean operation. What software do

Before you wire a deposit to a Chinese supplier or sign with a new partner, there is a basic check worth doing that costs nothing but time. China maintains a single official, free, public database of company registration information, known by its initials GSXT. It is the canonical source, and every commercial lookup service ultimately draws from it. Knowing how to read it, and knowing what it does and does not prove, is a small skill that prevents large mistakes. What GSXT is

For most of the history of China Company Law, a company had to have a supervisor or a board of supervisors, a role meant to monitor the directors and senior management. For foreign companies this was often an awkward requirement, filled by whoever was available and rarely active. The 2024 Company Law reworked this, giving companies more flexibility and, for smaller ones, the option to do without a supervisor entirely. Understanding the new choices matters, because the default

Paying an employee in China is not simply a matter of transferring a salary. Around that salary sits a system of mandatory social insurance and housing fund contributions, split between employer and employee, calculated on rules that vary by location and change over time. For a foreign company, getting this right is both a legal duty and a reputational one, because employees notice quickly when their contributions are wrong. The two halves of the payroll A China payroll has a

The first real decision in setting up a wholly foreign-owned company in China is not how to register but what to register. The business scope you choose determines which licences you need, how long setup takes, and what you are legally allowed to do once you are running. Getting it wrong is expensive to fix, because changing the scope later means going back through parts of the registration process. The three most common profiles are consulting, trading, and manufacturing, an

When China consolidated its foreign-investment rules under the Foreign Investment Law, it replaced a case-by-case approval regime with something lighter but ongoing. Instead of seeking approval for changes, most foreign-invested enterprises now report information through an integrated reporting system. It is less burdensome than the old approval process, but it is a continuing obligation rather than a one-off, and treating it as optional is a mistake. From approval to reporti

Foreign founders setting up in China consistently underestimate one step and overestimate their control over it. The business licence, the tax registration, the company chops, these run on reasonably predictable timelines. The corporate bank account does not. It is routinely the single longest step in the whole setup, and it sits at the end of the sequence, which means a delay there delays the moment the company can actually receive and deploy capital. Where the account sits

Registered capital is one of the most misunderstood numbers in China company setup. It is not a fee and it is not money you hand over at registration. It is the amount the shareholders commit to contribute to the company, declared when the company is formed. China removed strict minimum capital requirements for most industries years ago, which made setup cheaper and faster, but that freedom created a new trap. Because the number is now a judgement call, it is possible to get

For decades, foreign companies in China were governed by a separate body of law written specifically for them. That era has ended. Under the Foreign Investment Law, the old separate statutes for wholly foreign-owned enterprises and joint ventures were repealed, and the entities they created were given a five-year window to bring their governance into line with the general Company Law. That window has now closed, and the practical consequences are still catching up with compan

A practical Hong Kong MPF compliance guide for employers: assess eligibility, calculate contributions, meet deadlines, and keep payroll records accurate.

Can foreigners own Chinese companies? Learn which sectors are open, when approvals apply, and how to set up a compliant mainland China entity properly.

China permanent establishment risk can arise before you form a company. Learn the common triggers, tax exposure, and practical controls for expansion.