China - New Guidance Improves Access to Tax Treaty... | KPMG | CA

China - New Guidance Improves Access to Tax Treaty Benefits

China - New Guidance Improves Access to Tax Treaty...

Global Tax Adviser, September 29, 2015. China has introduced a new administrative system for granting tax benefits to non-residents under China's tax treaties that will no longer require certain government pre-approvals, among other changes. China has also released new forms to allow for self-assessment of treaty benefits. These measures, which are intended to be a substantial improvement over the existing system, will be effective November 1, 2015.


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Under the new system, China's tax authorities are no longer required to provide pre-approval for withholding tax agents to apply reduced treaty-related withholding tax rates for payments of dividends, interest, royalties, or capital gains or for taxpayers seeking to secure other tax treaty-related protection-such as permanent establishment protection. Under the new guidance, withholding tax agents may, on confirmation that the taxpayer satisfies the basic treaty criteria, directly apply the reduced rates of withholding tax under the applicable treaty. Also, taxpayers may simply file a completed form and supporting information to self-apply other tax treaty protections. 

Taxpayers should still maintain comprehensive supporting documentation as China has also established a new system of tax authority follow-up procedures. 

For more information, contact your KPMG adviser.


Information is current to September 29, 2015. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500

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