Set up a representative office in China, the full name is a foreign enterprise representative office, also called the permanent representative office of foreign enterprise in China. Resident representative office of a foreign enterprise only can engage in nondirect business activities. Representative foreign enterprise to do contact, product promotion, market research and technical exchange within the business range. Inter-Area has years of experience can provide clients not only registration of foreign representative, company or branch, but also complete service from consultation, application document making, local industrial and commercial registration until accounting service agent. Inter-Area provide one-stop service for the clients who want to set up a company in Shanghai, Shenzhen or Xiamen, make investors to truly target local businesses also take care of various business affairs, investors can focus on their business. The pace is more flexible, making the layout of the strategy more flexible, so companies from all over the world invest abroad and set up overseas companies.
Ⅰ. Specification of setting up the representative office in ChinaThe requirement of setting up an office in China for a foreign company:
|1. Registration in the resident country / area for more than two years.||2. No bad record in violation of Chinese laws.|
|3. Have a good record or certificate of business activity in the resident country/area.||4. The company registration certificate needs the notarization of the local authority, the Chinese embassy certification, and the credit certification.|
Ⅱ. The rule of name office in ChinaCountry + head office name(Chinese)+【area name】representative office (Head office name must be the nature of the limited company, the company name is the best ending. The business association also can be registered, but it needs competent department approval. 【Examples】： 1. Beijing XXXX consulting limited company Shenzhen city representative office. 2. XXXX(Shanghai) trading limited company Xiamen representative office.
Ⅲ.Characteristics and notices of setting up a representative office in ChinaChina representative office also called the office, set up China representative office can not directly to the business activity, failure to sign commercial contracts, issue orders, issue invoices, collect receipts, hold inventories, etc. The representative office only can cooperating main organization (foreign company) to do Non-commercial activities such as China market information collecting, contact, market promotion, etc.
- The representative office address must be the true address, the necessary information is：house purchase contract, the developer’s pre-sale permit copy, house purchase invoice.
- Tax payment：income tax and sales tax(due to company cost to deduct). Due to《State Administration of Taxation about foreign enterprises resident representative office’s notice of tax-related issues》approved the taxation of the foreign representative office, convert the income tax according to cost. Formula： Taxable income = Expenditure/(1-15%)*10%(interest rate) Payable enterprise income tax = Expenditure/(1-15%)*10%Profit * interest rate Sales tax = Expenditure/(1-15%)* interest rate
- The number of a representative shall adaptive with business development activity, The number of representative organization’ representative (including chief representative)must lower than 4 people. For the number of representatives of more than 4 people‘s representative organizations, in principle, only representatives are allowed to be canceled, not allowed to add.
Ⅳ. Setting up a representative office in China
|What is the function of setting up a representative office in China?|
|A: Setting up representatives in China for the sake of enterprise to collect marketing information and development in Beijing, Shanghai, Shenzhen, Xiamen, etc. Also can be a contact unit for foreign enterprise in China. Registration of setting up representative office must follow China regulations.|
|Is there any limit of setting up a representative office in China?|
|A:Can not do the business behavior in China and effect payments, there will be an only expenditure. Have to do an annual extension and renew authentication information of the offshore company.|
|Can representative office do profit-making behavior in China?|
|A: China representative office cannot do profit-making behavior, billing invoices, accept an order, deposit stock, receipt, etc. In principle, there will be only expenditure and no income.|
|What tax should be paid for setting up a representative office in China?|
|A: Because China representative office cannot have business behavior, the expenditure of the representative office is used as the accounting standard, the payable tax is about 10% of the expenditure of the representative office.|
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