Staff secondments and taxable presence for nonresident companies in China
International Tax Journal
On April 19, 2013, the SAT released Announcement 19 to clarify when a foreign entity may expose to Corporate Income Tax by way of secondment arrangements. If the secondee is considered as the employee of the Home Entity, but not the Host Entity, the business activities performed by the secondee will render the Home Entity a taxable business establishment in China. In other words, the Home Entity will be liable to CIT in respect of the income This article examines the implications of the announcement on Home Entities and suggested that Home Entities should start revisit the secondment arrangements.
Wong, P. W. Y. (2013). Staff secondments and taxable presence for nonresident companies in China. International Tax Journal, 39(4), 45-49.