China

Details

  • Service: Tax
  • Industry: Private Equity
  • Type: Publication series, Regulatory update
  • Date: 4/30/2012

Clarifications on the taxation of offshore indirect disposals in the pipeline 

Private Equity Tax Express - Issue 1, April 2012

 

Since the introduction of Circular 698 in late 2009, the possibility of a Chinese tax charge arising on an offshore indirect disposal of an interest in a Chinese company (through sale of an offshore company) has been a concern for private equity investors into China. In large part, the difficulty created by Circular 698 for investment exits is the uncertainty surrounding the manner in which it will be applied. This is in part due to the brevity of the circular itself, and in part due to the variable enforcement approach of different local tax authorities.

Private Equity Tax Express
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