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Successful Tax Planning
A renowned German machinery manufacturing company undertook a high-speed train project for the Chinese Ministry of Railways. Hwuason was appointed as a taxation consultant to assist the company to establish a project company in China, and to provide comprehensive taxation planning services. According to a detailed understanding of the technology which was held by the German side, Hwuason noted that the technology was fully in line with China encouraged high-tech areas. We provided professional advice that the newly established project company should be authenticated for a high-tech enterprise in China so that it can enjoy the low taxation rate and other tax benefits for such companies. We then assisted the German company to carry out the work to obtain high-tech enterprise status from the Chinese science and technology sector, and ultimately saved the client RMB50 million in liabilities. The interesting aspect about this case is that the client approached Hwuason to obtain general legal assistance but because of our team’s knowledge in this specific area we were able to identify this as an issue for the client.
A wholly owned subsidiary of a large American energy company in the process of ceasing its operations in China faced a comprehensive taxation liquidation problem. The turnover of this subsidiary was quite large during the calendar year and the taxation director was concerned that if the company taxation treatment was inconsistent with the provisions of the taxation law in China, it would be difficult to pass the taxation liquidation by China taxation authorities.
Appointed as the special taxation adviser, Hwuason led a comprehensive taxation audit of the company's calendar year taxation-related matters, and pointed out the remedial measures that the client could adopt. As a result, the company successfully passed the taxation liquidation by China’s taxation authorities and avoided significant economic losses.
Transfer Pricing Case
A German car company which invested in China set up a wholly owned parts production enterprise in China territory. Hwuason undertook review and recommended adjustments on the intercompany sales prices and sales practices to avoid the risk that it may breach China’s transfer pricing rules.
Individual Taxation Case
The executives of a well known British company held posts in both the China and British companies. As a result there was a potential for double taxation on the executives income. Through appropriate planning and communication with the China taxation authorities, Hwuason helped the clients save more than RMB500000 on individual income tax liability every year.