• Service: Tax, Global Transfer Pricing Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 8/28/2014

China - Reporting, documentation requirements concerning cross-border investments 

August 28: The cross-border transactions of Chinese entities that are expanding their outbound investment in both scale and numbers have posed challenges for China’s tax administration.

To address these cross-border issues, China’s State Administration of Taxation issued guidance---Announcement No. 38, which is effective 1 September 2014—that increases the supervision of offshore investments and aims to curtail potential leakage of foreign-sourced tax revenues.

Announcement No. 38:

  • Provides a higher standard of compliance and documentation preparation for taxpayers
  • Requires regular reporting of outbound investments and annual reporting of income earned overseas for PRC tax resident enterprises, as well as non-PRC tax residents that have an establishment or a place of business in China and that derive income that is effectively connected with such establishment or place of business

Read an August 2014 report prepared by the KPMG member firm in China: Announcement of State Administration of Taxation on Issues Relating to the Information on Outbound Investment and Related Income Reported by Resident Enterprises

Contact a tax professional with KPMG's Global Transfer Pricing Services.

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