Offshore company tax avoidance
By buying high and selling low, we can make profits offshore and leave the losses to domestic companies, thus avoiding domestic value-added tax.
Transfer pricing
Transfer pricing is an important method of tax avoidance.
Tax avoidance has always been the goal pursued by most offshore companies. 20 10 August, the State Taxation Bureau of Luohe City, Henan Province revealed that Goldman Sachs transferred Henan Shuanghui Investment Development Co., Ltd. (hereinafter referred to as? Shuanghui development? ), but did not pay taxes to the Henan Provincial State Taxation Bureau, and evaded corporate income tax of 420 million yuan. In March 2006, Goldman Sachs and CDH incorporated Shine B Holdings I Limited (hereinafter referred to as Shine B) in the British Virgin Islands. Shine B Company completely controls Rotex Company (a joint venture company established by Goldman Sachs and CDH in Hong Kong in February of the same year), and Rotex Company controls Shuanghui Development Company. Goldman Sachs realized the actual reduction of Shuanghui Development outside China through Virgin Sunshine B.. By the end of 2009, its shareholding in Shuanghui Development had dropped to 3.3%. This is far from the fact that Goldman Sachs indirectly held 365,438+0% shares in Shuanghui Development in 2006. According to the annual reports of Shuanghui Development in 2006, 2007 and 2008, the income of Goldman Sachs may reach 2 1 100 million yuan. According to the newly revised enterprise income tax law in 2008, the capital operation projects of enterprises, including equity transfer and income tax management of non-resident enterprises, have been included in the key scope of tax collection and management in China. This is a typical case of tax avoidance by indirect overseas equity transfer.
At the end of 1990, a company in Hebei and a certain M Group (overseas) jointly invested to establish a Sino-foreign joint venture A company with a registered capital of 250 million yuan and a total investment of 300 million yuan, mainly engaged in the production and sales of automobiles and related spare parts. However, the annual report data of company A has been in a state of low profit. Investigation by Hebei State Taxation Bureau and Shijiazhuang State Taxation Bureau found that Company A imported raw materials from related parties (M Group) and exported products to related parties. Transfer pricing? Behavior: import raw materials and processed products from M Group at a high price and export them to M Group at a low price. ? One high and one low? Reduce the profits of Company A and the corresponding taxes. From June 5438 to February 2008, Company A paid 43.75 million yuan of tax payable to the tax authorities. Zhu People's Republic of China (PRC) is a researcher at State Taxation Administration of The People's Republic of China Institute of Taxation Science. He used to be the director of taxation at the grass-roots level, and he is very familiar with the operation of using offshore companies to avoid taxes. Zhu said that because there is no tax in offshore places such as Virgin and Cayman, the profits are given to offshore companies by buying high and selling low, and the losses are left to domestic companies, thus evading domestic value-added tax. In 2007, National Bureau of Statistics? Study on the Utilization of Foreign Capital and Foreign-invested Enterprises? A research report completed by the research group shows that about two-thirds of the loss-making foreign-invested enterprises surveyed have abnormal losses, and these enterprises have passed? Transfer pricing? Tax avoidance by other means amounted to more than 30 billion yuan.
Mailbox company
Mailbox companies are also an important means of tax avoidance.
So-called? Mailbox company? It is to register an offshore shell company and achieve the purpose of tax avoidance through document operation.
Mei Xinyu, a researcher at the Research Institute of the Ministry of Commerce, told such a case. A domestic company registered a company in the British Virgin Islands, engaged in the production of electrical parts. The actual production business is located in China, and the unit cost price is $5, which is sold to Virgin Company at a very similar price, and then sold to American companies at a price of about $7, and American companies sell to China at a price of $7.
The whole buying and selling process is just a formality on the paper, but it didn't actually happen. The income of China and the United States is almost zero, so the value-added tax of the two countries cannot be levied. Virgin, on the other hand, is exempt from income tax, which greatly reduces the company's total global tax payment and saves operating costs.
Before 20 10, 12, 1, did China reduce or exempt enterprise income tax for foreign investment? Super national treatment? Before the cancellation, many domestic capitals flocked to Cayman, Virgin and other places to set up offshore companies. Foreign capital? Go back to China and enjoy it? Foreign capital? Treatment.
The government set it up to encourage exports? Export tax rebate? Other preferential measures are often taken by offshore companies? An impostor? . Some companies use it? Fake exit? To get tax preference, go through relevant export procedures, transport the goods to the high seas, then transport them back to China, and then go through a customs import procedure, you can get tax-free treatment. Even some enterprises don't ship the goods to the high seas, but put them directly in some bonded warehouses in China, and get a tax refund after going through the relevant export procedures? Profit? .
Successful cases of tax avoidance by offshore companies
A private clothing company in Beijing (Company A) mainly produces and sells middle and high-grade clothing. Although company A has a good design ability, it generally produces branded clothing, that is, it is authorized by a foreign brand clothing company to hang its own label on the clothing produced by company A and then sell it. However, Company A has to pay trademark royalties to foreign companies according to the number of clothing listed, which reduces the profits of Company A, but now consumers' recognition of brands in Hong Kong, Italy and other countries and regions is still far higher than that of domestic brands. In addition, the production and sales of clothing are increasing, and the impact of income tax on final income is becoming more and more obvious.
Now consumers agree that international brands are an unavoidable fact, but we can consider registering a trademark abroad to solve the problem of paying high trademark use fees to other companies. In terms of taxation, we can make use of the special preferential provisions in China's tax policy and the tax reduction and exemption policies of some countries to reduce the tax burden for Company A reasonably and legally.
Operation:
1, Company A finally chose to register Company A and Company B in Hong Kong;
2. After the company is successfully registered, apply for the registration of Hong Kong trademarks in Hong Kong and the Mainland;
3. Establish a Sino-foreign joint venture clothing company (Company C) in Beijing. The shareholders are Company A and Company B respectively, in which Company B contributes 25% of the registered capital of Company C and Company A contributes to the clothing factory;
Company B signed a trademark license agreement with Company C. ..
Effect:
1. In terms of brand, Company A has its own international brand, which not only caters to consumers' recognition of international brands, but also enhances consumers' trust in brands through the sales of Sino-foreign joint ventures. And in the long run, Company A can finally try to create a famous brand for itself rather than others.
2. From the point of view of cost and tax, Company A no longer needs to pay trademark royalties to foreign companies, which reduces a large part of the cost;
In terms of taxation, firstly, according to the tax policy stipulated by law for Sino-foreign joint ventures to attract foreign investment in China, Company C can enjoy it from the profit-making year? Two exemptions and three reductions? Income tax incentives; Secondly, the trademark use fee of Company B in Hong Kong can also reduce the pre-tax profit of Company C, thus reducing the income tax in a controlled way.
4. Other advantages. On the one hand, with its own brand, Company A can not only consider developing in other regions or even abroad, but also carry out brand management such as paid trademark authorization after scale expansion. On the other hand, after the shareholders of Company A become shareholders of Hong Kong companies, they can have more advantages than the shareholders of domestic enterprises in terms of visas for going abroad and the use of foreign exchange. At the same time, Company A can even prepare for listing and financing in Hong Kong and other places in the future.
Therefore, through a series of operations such as registering an offshore company, Company A has incomparable advantages over domestic enterprises in brand, tax and cost. It can be said that the economic benefits and long-term benefits are obvious.
The above is how offshore companies avoid taxes. I hope you like it!
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