Since 1 January 2008, The People's Republic of China will actualize the New Corporation Income Tax system, which unites the domestically-funded enterprises and enterprises with foreign investment Tax System. Then, the tax scope, rate and preference were unified for domestically funded and foreign investment. There are also some special rules about the business between corporations; accordingly the business between corporations would be more equity and clarity.

Object of Taxation

• The corporations within China and the profit organizations are the taxpayer of corporation income tax.
• Corporations were distinguished Resident Corporation from Non-resident Corporation.
• Resident Corporation is the corporation which enrolled in People's Republic of China and enrolled in other country but the management organization is in China.
• Non-resident Corporation is the corporation which enrolled in other country and the management organization is not in China, but has establishments or places within China. Or else, it doesn't have establishments or places in China but there are some profits derived from sources within China.

Scope of Charge

• Resident Corporation should be taxed on their profits derived from sources within or out of China.
• Non-Resident Corporation which has establishments or places in China should be taxed the Corporation Income Tax on their profits derived from the establishments or places in China, and the profits doesn't derived from China but have relationship with the establishments or places in China should also be taxed. The corporations which doesn't have establishments or places in China and have establishments or places in China but their profits doesn't have relationship with the establishments or places should be taxed the Corporation Income Tax on their profits derived from sources within China.