The Resource Seconded UK employees as a permanent establishment in China

Seconded UK employees as a permanent establishment in China

Label
Seconded UK employees as a permanent establishment in China
Title
Seconded UK employees as a permanent establishment in China
Creator
Subject
Language
eng
Summary
Under the China-UK double tax agreement, UK firms deriving profits in China are protected from Chinese tax liabilty on the profits unless the profits are derived through a permanent establishment (PE). Unlike the original 1984 treaty between China and the UK, the current treaty, effective from 1 January 2014, deems a UK company to have a PE in China in some circumstances where its employees provide services in China, including services provided to its subsidiaries, for more than 183 days in a 12 month period. Where this happens, the profits of the deemed PE will be subject to Chinese company income tax. The profits will normally be calculated as a percentage of the service fee paid to the UK employer for the services provided by its employees. This article explores the circumstances in which a UK employer can find itself with a deemed PE in China when seconding its employees to work in its Chinese subsidiaries and, when this happens, how its tax liability may be calculated
Citation source
In: British tax review. - London. - (2016),
http://library.link/vocab/creatorName
  • Guo, W
  • Krever, R.E
  • Teoh, J. (Jonathan)
Language note
English
http://library.link/vocab/subjectName
  • PE
  • secondment
  • service fee
  • services PE
  • tax treaty
  • tax liability
Label
Seconded UK employees as a permanent establishment in China
Instantiates
Publication
Label
Seconded UK employees as a permanent establishment in China
Publication

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