Chinese State Administration of Taxation has published a public notice that Chinese local companies must report additional information regarding foreign investments and income to improve the effectiveness of tax administration and oversight of those Chinese local companies and that will effect from first September in this year.
On July 3, 2014, Chinese State Administration of Taxation’s Issued a notice on “Resident Enterprise Reporting of Information on Overseas Investments” that provides resident businesses have to report to it all necessary information regarding their current holdings of shares in overseas company, when they dispose of shares held in a overseas enterprise, or if they attain a certain threshold of voting shares held in foreign enterprises.
A resident enterprise has to report SAT:
- If the resident enterprise holds 10% or more shares of a foreign enterprise as of September 1, 2014.
- If the resident enterprise’s holding of the shares of a foreign enterprise reaches 10% or more after September 1, 2014.
- If the resident enterprise’s holding of shares of a foreign enterprise decreases from 10% or more to under 10% after September 1, 2014.
