Announcement of the State Administration of Taxation on Several Issues Relating to the Implementation of Tax Treaties
Announcement of the State Administration of Taxation on Several Issues Relating to the Implementation of Tax Treaties
Announcement of the State Administration of Taxation on Several Issues Relating to the Implementation of Tax Treaties
Announcement of the State Administration of Taxation [2018] No.11
February 9, 2018
In order to standardize and regulate the implementation of the treaties signed by the Chinese government with foreign parties for the avoidance of double taxation (hereinafter referred to as "Tax Treaties"), matters related to clauses under the Tax Treaties (hereinafter referred to as "Treaty Clauses") on permanent establishments, shipping and air transport, and entertainers and athletes, as well as the application of the Tax Treaties to partnerships, are hereby announced as follows:
I. A Sino-foreign cooperative education institution that does not have a legal person status, as well as the place where the educational and teaching activities of a Sino-foreign cooperative education program is conducted, shall constitute a permanent establishment in China by a resident of the other Contracting State to a Tax Treaty.
With respect to the expression "for a period or periods aggregating more than 6 months within any twelve-month period" in a Treaty Clause on permanent establishments as to whether a service activity constitutes a permanent establishment, the expression "for a period or periods aggregating more than 183 days within any twelve-month period" shall apply instead.
II. Where a Treaty Clause on shipping and air transport is consistent with the provisions of Article 8 (Shipping and Air Transport) of the Agreement between the Government of the People's Republic of China and the Government of the Republic of Singapore for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and the protocols thereof (hereinafter referred to as the "Sino-Singapore Tax Treaty"), it shall be implemented in accordance with the following principles:
1. Income derived by an enterprise of a Contracting State from the other Contracting State from the operation of ships or aircraft in international traffic (hereinafter referred to as the "operation in international traffic") shall be exempted from taxation in the other Contracting State.
The term "income from the operation in international traffic" shall refer to income derived by an enterprise from the operation of ships or aircraft used for transport of passengers or goods, and income from the rental of ships on a voyage or time charter basis or aircraft on wet lease basis (including full equipment, crew and furnishing).
2. The tax exemption provisions of the preceding Paragraph 1 shall also apply to income from the participation in a partnership, a joint business or an international operating agency.
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Announcement of the State Administration of Taxation [2018] No.11
February 9, 2018
In order to standardize and regulate the implementation of the treaties signed by the Chinese government with foreign parties for the avoidance of double taxation (hereinafter referred to as "Tax Treaties"), matters related to clauses under the Tax Treaties (hereinafter referred to as "Treaty Clauses") on permanent establishments, shipping and air transport, and entertainers and athletes, as well as the application of the Tax Treaties to partnerships, are hereby announced as follows:
I. A Sino-foreign cooperative education institution that does not have a legal person status, as well as the place where the educational and teaching activities of a Sino-foreign cooperative education program is conducted, shall constitute a permanent establishment in China by a resident of the other Contracting State to a Tax Treaty.
With respect to the expression "for a period or periods aggregating more than 6 months within any twelve-month period" in a Treaty Clause on permanent establishments as to whether a service activity constitutes a permanent establishment, the expression "for a period or periods aggregating more than 183 days within any twelve-month period" shall apply instead.
II. Where a Treaty Clause on shipping and air transport is consistent with the provisions of Article 8 (Shipping and Air Transport) of the Agreement between the Government of the People's Republic of China and the Government of the Republic of Singapore for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and the protocols thereof (hereinafter referred to as the "Sino-Singapore Tax Treaty"), it shall be implemented in accordance with the following principles:
1. Income derived by an enterprise of a Contracting State from the other Contracting State from the operation of ships or aircraft in international traffic (hereinafter referred to as the "operation in international traffic") shall be exempted from taxation in the other Contracting State.
The term "income from the operation in international traffic" shall refer to income derived by an enterprise from the operation of ships or aircraft used for transport of passengers or goods, and income from the rental of ships on a voyage or time charter basis or aircraft on wet lease basis (including full equipment, crew and furnishing).
2. The tax exemption provisions of the preceding Paragraph 1 shall also apply to income from the participation in a partnership, a joint business or an international operating agency.
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