What is the tax if foreigners set up a trading company in Guangzhou to export products from China?
It depends on which kind of products you export from China.
For example: If your company is WFOE in Guangzhou, whose shareholders are foreigners( not foreign company), and you export electronic products from China, here is the tax you will be involved:
- VAT : 17% but you can get 17% rebate. So the VAT will be 0.
For other product, the tax rebate rate usually 10???6% depends on which product you want to export. - Additional tax : About 1???% of the revenue;
- Corporate income tax: 10% if the annual net profit is below 0.5 million, 25% if net profit is above 0.5 million;
- Individual Income Tax: In China If foreigners get dividends of their investment, the individual income tax rate is 0%.
So for foreigners the best way to save tax in China is set up a WFOE whose shareholders are foreigners.
http://www.startupbusinesschina.com/how-do-foreigners-work-legally-in-china/
