BRIDGE YOU INTO THE CHINESE MARKET

Three steps to run your business in China:

  • To set up an enterprise
  • To build an operation team
  • To protect the business on financial and legal aspects

Star Acc, a one-stop service provider, your

bridge to the Chinese market.

    China & Shang Hai Business Services

    We deliver complete company setup solutions to help you navigate through China’s ever-changing corporate landscape.

    Company Formation

    Establish your business in China with our experts. Complete WFOE or WOFE registration packages in Shanghai, Shenzhen, Guangzhou, Beijing, & Hong Kong.

    Tax & Accounting

    Our accounting experts are fully committed to planning innovative Chinese tax strategies with our professionalism and care for each and every client.

    Corporate Services

    We provide complete corporate secretarial services & solutions to suit your Chinese corporate needs, so that you can focus on what matters the most.

    Chinese Visa Support

    Our consulting team will assist you during China’s visa application to provide you with clear information and effective solutions throughout the process.

    Why Set Up Your WFOE in China?

    Our consulting team will work with you during every step of your Chinese WFOE / WOFE registeration.

    Independence

    A WFOE is an independent enterprise which doesn’t have to rely on or deal with Chinese partners. Thus it can make it’s own decisions and do so in a more direct and streamlined manner.

    Cheap Labor

    Opening a WFOE gives you access to the cheaper labour provided by the Chinese workforce which can reduce the cost of your labour. This reduces overhead costs in comparison to operating in many other countries.

    Business Scope

    A WFOE can negotiate its own business scope directly with the authorities. This means that it can chose its own path more easily, as it is not tied to a partner company in China that would have a hand in determining its scope of operations.

    Banking

    A WFOE can open a Chinese bank account, making it easier to do business with investors/suppliers. This is because it allows the WFOE to more easily trade in RMB, and the Chinese investors/suppliers generally don’t like to do use foreign currency.

    Legal Status

    A WFOE is legally an independent entity under the laws of the PRC. This creates the benefit that the rights and liabilities of the company are separate from those of its participants. 

    Hiring Procedure

    A WFOE has the advantage of being directly in control of who it hires, meaning that it can hire the staff that it wants. This is in contrast to an RO who must hire through a government agency, or a Joint Venture, where the foreign investor may not get as much say in the hiring of staff.

                Incorporation of Chinese WOFE

    If you want getting a business registration certificate for your Chinese WOFE ( Wholly Owned Foreign Enterprise ) to expand your brands, ideas, and market in the mainland China, first you need to register a limited company and submit all legal files and the documents of incorporation to local government offices, the whole procedure needs 3 weeks. Undoubtedly, choose WOFE as your enterprise type is the most effective way.

    The whole process of company registration is very simple for starting up a private limited company in mainland China. All legal files and documents you can appoint local lawyers or consultants to help you submitting to government office, and you have to provide legally proof of identification for shareholders, legal representative and supervisor.

                How Long Processing of Setting up a WOFE

    If you submit all prepared legal official forms and files for business registration to local government offices, your certificate of Chinese company will be approved quickly. The certificate of registration known as 5-in-1 business license. Do not worried about your language, our international consultants and lawyers will email to you all Chinese official files, documents, and guide you to prepare and sign these required documents. From our experience, the whole process needs 3 weeks.

       

                What Requirement Documents Need to Prepare

    1.Notarized documents of shareholders and legal representative, issued from China embassy in your home country.

    2.Copy of passport for supervisor.

    3.Here SMEsChina will prepare all official documents and legal files for your application of business registration, you can deliver to our firm after your signature.

    Once you getting the Chinese business license for your Chinese WOFE, you have to apply for tax registration ( VAT ), and fulfil tax reporting obligations. SMEsChina teams also offer the supporting of tax returns.

    If you would like getting more guidance of register a business in mainland China, we have rich experience and knowledge to assist you registering and starting up a Chinese local business as a WOFE confidently.

                 Our WFOE Service Packages Contain the Following Items:

    Assist global customers to jump into China market.

    Collection, approval, and verify the documentation prepared by customers and our teams.

    Offer a legal virtual office address to obtain the approval of registration.

    Name search and submit application, get the approval of the corporate name.

    Documents and forms preparation, and signature of the corporate shareholder(s).

    Apply for the certificate of registration of foreign owned enterprise approved by the local Municipal Commission of Commerce.

    Obtainment of the business registration license from the local licensing authority, know as: 5-in-1 business license.

    Issuing of the corporate stamps, known as corporate seals.

    Documents collection and submitting for tax registration, and VAT taxpayer application.

    Basic and capital accounts opening and capital account declaration.

    Government cost, translate fee, and drafting of the legal files and forms.

    Import and export license registration and permits application.

    Yearly administrative and maintaining services, such as license renew.

    Annual bookkeeping and tax declaration services for income tax report, annual audit, government inspection, tax final settlement.

    Other optional service selections, such as: HR, social insurance, housing fund, VISA and resident permit, trademark, etc.

    OUR SERVICES

    Our expertise lies in corporate registration, accounting outsourcing, taxation, financial planning and software development. The team of experts are with average 10 years of experience who always seek understanding of clients’ businesses for more insights.

    STAR provides an experienced and comprehensive solution to convert your Chinese business vision into reality. Regardless where you are from, which sector you engage, how big you are, creating value in helping you work more efficiently and achieving goals are we thrive for.

    The six service components cover all practical steps in implementing business operation, from establishing a company comply with regulations to subsequent accounting and taxation relevant to the business, as well as other facilitating services such as banking/cash management, employee social benefits account management and work permit application and stamp management. Our vision is to be the most trusted business advisor and corporate service provider for foreign investors in China.

    Have a chat with us and see what we could do for you.

    How to Start a Manufacturing Business in China

    Shareholder(s) / Owner(s)

    Any existed foreign companies, foreigners ( nonresidents ) can be the shareholder(s) of a China WFOE, and obtain the approval of certificate of business registration to operate daily businesses and transactions. Before setting up a WFOE in mainland China, you have to make a decision, who will be the shareholder(s), known as owner(s), because shareholders have the right to distribute the final profit of after-tax.

    Corporate Shareholder(s)

    A foreign parent company ( existed corporation ) as the shareholder to own the 100% stocks ( shares ), need to register a Chinese subsidiary company as a wholly foreign owned enterprise, and the Chinese WFOE as an independent subsidiary to operate businesses in local market. Foreign parent company as the controlling party, has to obtain notarization and authentication documents for the certificate of registration of foreign parent company issued by the Chinese embassy in your home country.

    Individual Shareholder(s)

    Non residents also can be the shareholder(s) of a WFOE, and you have to apply for the notarization and authentication documents for your passport issued by Chinese embassy in your country.

    WFOE’s Supervisor

    Supervisor, known as: senior secretary, appointed by corporate shareholder(s), no nationality restrictions. An individual shareholder also can be the position of supervisor. But according to Chinese company laws, the supervisor cannot serve as legal representative at the same time. Foreign supervisor just needs the passport copy and photo, Chinese supervisor needs original ID and photo.

    Business Scope

    Known as: business activities, you have to select a list from national economic industry classification and obtain approval of business registration, whatever your industry is, you must apply for the business scope when you submitting the application of certificate of registration. Also, different business activities mean different taxation rates, such as: trade, service, engineering, etc. 

    Registered Capital

    Known as: investment capitals, corporate shareholders act as investors and fulfill their capital contribution obligations. China government allows foreign shareholders to inject the registered capital with 30 years once local corporation be approved. Registered capital will be transferred from oversea shareholder’s account to Chinese corporate account after exchanging to RMB currency.

    Setting up registered capital is a mandatory provision you have to comply with that, if you are deciding to establish a Chinese business. Traditional trade or service industry, the minimum registered capital is 20,000 USD or Euro. 

    Requirements of China WFOE Registration

    Key Structure of

    WFOE:

    Required

    Documents:

    Remarks:

    Corporate
    Shareholder
    Notarization and authentication documents for the certificate of registration of foreign parent company issued by the Chinese embassy.
    2 sets,
    bilingual
    Individual
    Shareholder
    Notarization and authentication documents for the passport issued by the Chinese embassy. 16 years old at least.
    2 sets,
    bilingual
    Legal
    Representative –
    Chinese People
    Original ID card, photo, 16 years old at least.
    none
    Legal
    Representative –
    Nonresident
    Notarization and authentication documents for the passport issued by the Chinese embassy. 16 years old at least. 
    2 sets,
    bilingual
    Supervisor –
    Chinese People
    Original ID card, photo, 16 years old at least.
    none
    Supervisor –
    Nonresident
    Passport copy, photo, 16 years old at least.
    none

    Key Structure of

            WFOE:

    Key Structure of

             WFOE:

    Key Structure of

        WFOE:      

    Taxation of Foreign Owned Enterprises

    Whatever your corporate type is, all taxes of the company are consistent with the local resident enterprises,
    such as VAT, profit tax, personal tax, additional taxes, and so on.

    Basic

    Taxes:

    Service

    Activities:

    Trade

    Activities:

    Engineering and

    Installation:

    VAT –
    Value Added Tax
    6%
    13%
    9%
    Corporate Income Tax – Profit Tax
    ( less than 1 million RMB each year )
    5% ( preferential tax rate )
    5% ( preferential tax rate )
    5% ( preferential tax rate )
    Corporate Income Tax – Profit Tax
     ( 1 – 3 million
    RMB each year )
    10% ( preferential tax rate )
    10% ( preferential tax rate )
    10% ( preferential tax rate )
    Corporate Income Tax – Profit Tax
    ( more than 3 million RMB each year )
    25%
    25%
    25%

    STAR–ACC

    Established in 2007, Star Accounting & Consulting is a comprehensive service provider in company registration, accounting outsourcing and tax planning, specifically positioned as the guardian for foreign investors intending to enter the Chinese market. As the member ofglobal  accounting alliance – IECnet, and the Vice President of Shanghai Accounting & Bookkeeping Association, STAR have the expertise and the resources to realize your business vision. Let us do the heavy lifting for you.

    w

    SERVICE PHILOSOPHY

    “Efficiency, transparency, and value creation are the cornerstone of our operation. We are devoted to deliver high quality integrated accounting services and be our clients’ most trusted advisor and guardian.”  —Sun Yanjun, Founder and Director

    VALUE

    Our consulting team will assist you during China’s visa application to provide you with clear information and effective solutions throughout the process.

    TECHNOLOGY & INNOVATION

    Cloud accounting enabled client with real-time update on accounting data.

    Adopting internal control platform to ensure transparency and efficiency in service performance

    CREDENTIALS

    STAR is proud to be the global accounting alliance – IECnet, who has presence in 88 countries and 6 continents.

    Founder & Director Mr. Sun Yanjun is the Vice President of Shanghai Accounting and Bookkeeping Association

    EXPERTISE

    Clientele covers across 10 industries from 5 continents, including Fortune 500 corporations

    Three service language –English, French and Mandarin

    FREQUENTLY ASKED QUESTIONS

    1.What is salary income?

    Answer: Wages, salaries, bonuses, year-end salary increases, labor dividends, allowances, subsidies, and other income related to the position or employment of an individual are wages and salary income.

    2.Is the income earned by an individual serving as a director and supervisor of the company classified as salary?

    Answer: Individuals who serve as directors or supervisors of the company, and do not serve in the company, director fees and supervisor fees obtained from employment, belong to labor remuneration, and should be levied personal income tax according to the item of “labor remuneration”; individuals serving in the company (including affiliated companies), Those who are employed and concurrently serve as directors and supervisors belong to wages and salaries, and the directors’ fees and supervisor’s fees shall be combined with personal wages, and individual income tax shall be calculated and levied uniformly according to the item of “wages and wages”.

    3.Are the subsidies and allowances given to employees by the unit in the name of meal allowances belong to wages?

    Answer: The allowance for missed meals, which is not taxed as required, refers to those individuals who work in urban or suburban areas on business and cannot go to work or return to dinner and really need to eat out according to the actual number of missed meals. Miscellaneous meals received by the prescribed standards. Except for the above-mentioned circumstances, the subsidies and allowances issued by the unit to employees in the name of meal allowances belong to wages and salaries, and should be incorporated into the current month’s wages and salary income for calculation of personal income tax.

    4. Should the over-paid three insurances and one housing fund be incorporated into the current salary and salary to calculate and pay personal income tax?

    Answer: If the unit exceeds the prescribed ratio and standard to pay for the “three insurances and one housing fund”, the excess shall be incorporated into the individual’s current salary and salary income, and individual income tax will be calculated.

    5. Should taxpayers who need to declare and pay multiple taxes including corporate income tax (prepayment), urban land use tax, real estate tax, land value-added tax, and stamp tax at the same time, must make a comprehensive declaration?

    Answer: Starting from July 1, 2020, when taxpayers need to declare and pay one or more of the corporate income tax (prepayment), urban land use tax, property tax, land value-added tax, and stamp tax, they can choose the comprehensive tax declaration. Among them, corporate income tax payers do not currently cover tax-paying companies operating across regions.

    6. The individual tax paid in a certain country is higher than the calculated deduction limit, what should I do if there is no deduction?

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    7. Which value-added tax invoices can be checked on the VAT invoice selection confirmation platform?

    Answer: According to Article 2 of the “Announcement of the State Administration of Taxation on Expanding the Pilot Scope of Small-scale Taxpayers Issuing Special Value-Added Tax Invoices” (State Administration of Taxation Announcement No. 8 of 2019), general taxpayers obtain special value-added tax For invoices, uniform invoices for motor vehicle sales, and general electronic VAT invoices for toll road tolls, you can use the VAT invoice selection confirmation platform to query and select VAT invoice information for deduction, export tax refund, or tax refund.

    8. After the VAT exemption standard is raised, how to deal with the sale of real estate by other individuals?

    Answer: According to the current policy, if the taxpayer applies the simplified tax calculation method, the sales amount returned to the buyer due to the sales return shall be deducted from the current sales amount. Therefore, small-scale taxpayers with sales returns should deduct the corresponding sales returns from the actual sales in the current period to determine whether the tax exemption policy below 100,000 yuan applies.

    9. Small-scale taxpayers who pay monthly taxes make a sales return in the previous month, and the actual sales this month

    How do I determine whether this month’s sales can enjoy the value-added tax exemption?
    Answer: According to the current policy, if the taxpayer applies the simplified tax calculation method, the sales amount returned to the buyer due to the sales return shall be deducted from the current sales amount. Therefore, small-scale taxpayers with sales returns should deduct the corresponding sales returns from the actual sales in the current period to determine whether the tax exemption policy below 100,000 yuan applies.

    10.Small-scale taxpayers who report quarterly can enjoy the VAT exemption policy after excluding the sales of real estate transfers. What should be paid attention to when reporting?

    Answer: According to the current policy, if a small-scale taxpayer has real estate sales in the current period, the current sales after deducting the real estate sales are used to determine whether it exceeds 100,000 yuan (300,000 yuan on a quarterly basis). In the process of declaration, taxpayers can report real estate sales according to the prompts of the declaration system, and the system will automatically prompt whether it exceeds monthly sales (quarterly sales) and fill in matters needing attention.

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    Happy to work around you and assist you to jump into the China market smoothly, we look after your daily operations confidently by our experienced teams