Entrepot trade operations (use of offshore accounts)

Hong Kong has tax regulations that require no tax on overseas profits, so using a Hong Kong company for re-export trade can reasonably avoid taxes and reduce costs. For the purpose of operating costs, corporate profits should be remitted to and kept in the offshore account of the Hong Kong company as much as possible.

Export can be operated like this:

For example, your customer is from Australia For an ABC company, your Hong Kong company first purchases goods from your company in Shanghai at a cost of US$600,000, and then sells them to ABC company in Australia for US$1 million. Your Hong Kong company here plays the role of re-export trade. There are two contracts during the operation, but the goods from Shanghai can be sent directly to Australia; the Australian ABC company will pay the payment of 1 million to your Hong Kong company's account according to the contract, and your Hong Kong company will then pay 600,000 US dollars for related costs and other expenses. to your company’s account in Shanghai. This plays a role in avoiding exchange rate losses, especially in terms of taxation. Since the US$400,000 profit retained by the Hong Kong company can be applied for overseas gains, there will be great savings.

The import business can be operated in reverse. In the past, you imported goods with a cost of 600,000 yuan from an overseas customer, and finally sold them to other domestic customers for 1 million yuan. Then you would have to pay domestic corporate income tax based on the profit of 400,000 yuan. But now you can use a Hong Kong company to complete such a business. First, buy the goods with a cost of 600,000 in the name of the Hong Kong company, and then sell them to your own domestic company at a higher price of 950,000. Finally, it will still be 100,000. By selling to your end customer, you only need to pay corporate income tax of 50,000 yuan in China, while the other 350,000 yuan of profit will be successfully retained in the Hong Kong company account.

Bank account

You can open an account in Hong Kong (such as HSBC, Standard Chartered, Bank of China, etc.), or you can open an account in Shanghai (such as Standard Chartered, China Merchants, Communications, East Asia, Shenzhen Development Bank, etc.) etc. bank). This type of bank account opened in Shanghai is called an offshore account, which is equivalent to a bank account opened overseas. The funds in the account can be freely remitted to domestic, foreign, companies, and individuals without submitting any government approvals, customs declarations, contracts, etc. It is equivalent to a personal wallet, with free entry and exit of foreign exchange. You can pay at will, including collecting personal commissions for foreign exchange. Because it is an overseas account, it is not subject to mainland foreign exchange control and is not subject to interception. It is very important for you to conduct international trade settlements such as transferring to LC and receiving TT. Convenient.

Nowadays, many businesses are individuals who have factories in mainland China (some have import and export rights, some do not) or do not have factories and companies, but they will choose to register a company in Hong Kong or overseas. What's the secret?

For example, your customer is an American customer A, and you have been exporting goods through foreign trade company B. The current operation is: use your registered overseas company (assuming it is a Hong Kong company) to first purchase goods from a domestic company. That is, the domestic company first exports the goods to your own Hong Kong company through foreign trade company B, and then the Hong Kong company sells them to American customer A. Here, the Hong Kong company plays the role of re-export trade, but domestic goods can still be sent directly to the United States. The American company will first pay the payment to your Hong Kong company's account according to the contract (this account can be opened in China, called an offshore account), and the Hong Kong company will then pay the relevant costs and other expenses to foreign trade company B (let the foreign trade company do it Tax refund write-off and other follow-up matters). In this way, your profits have been retained in the offshore account, and the profits will not be settled in foreign exchange. You can use foreign exchange at will. You do not need to pay any tax on the profits, because Hong Kong does not levy overseas profits. tax. When you need to use the money, you can transfer it directly to your domestic company's account or your personal foreign currency account. The advantage of this operation is that foreign trade company B can no longer contact your American customer A.