Administrative Measures for Calculation and Settlement of Enterprise Income Tax on Non-Resident Enterprises

On January 22, 2009, the State Administration of Taxation promulgated the Administrative Measures for Calculation and Settlement of Enterprise Income Tax on Non-Resident Enterprises (the "Measures"), effective retroactively January 1, 2008. The Measures require that any non-resident enterprise with institutions and establishments in China should follow the calculation and settlement procedure, as specified in the Measures, within five months after the end of the calendar year, no matter whether it makes profits or suffers from losses. However, a non-resident enterprise that has already settled its taxes in China when the relevant contracted projects or labor services were completed during the year, or has deregistered its registered establishments during the settlement period is not required to make such final settlement. The Measures also provide the procedural and documentation requirements with respect to the settlement and the legal consequences for failure to comply with such requirements.

Copyright ©2009 by Kaye Scholer LLP. All Rights Reserved. This publication is intended as a general guide only. It does not contain a general legal analysis or constitute an opinion of Kaye Scholer LLP or any member of the firm on the legal issues described. It is recommended that readers not rely on this general guide but that professional advice be sought in connection with individual matters. References herein to "Kaye Scholer LLP & Affiliates," "Kaye Scholer," "Kaye Scholer LLP," "the firm" and terms of similar import refer to Kaye Scholer LLP and its affiliates operating in various jurisdictions.