China Q and A


China Question & Answers

Q 1: How would WFOE be defined?

A WFOE is basically a completely owned foreign enterprise. It is a Chinese company with limited liability, being owned by one or more foreign investors and established purely on foreign capital.

Q 2: What is the basic structure of WFOE?

The organisational structure of WFOE includes the director, shareholder, general manager, supervisor and legal representative.

Q 3: How much share capital is required? Do I need to invest some money into the WFOE?

Basically, it depends on the type of business and with the exception to special business, a share capital of RMB 100,000 is required. However, you just need to pay RMB 15,000 to register the WFOE and to start business.

Q 4: What type of business activities are allowed through WFOE?

Mostly there is not any restriction and most of the businesses are allowed to be done in China whereas special business requires special permission and for them required capital threshold is also high. To make sure whether your business would be allowed to be done in China, we appreciate if you could send your application form to us, we shall get back to you after reviewing your application.

Q 5: What is the procedure to register a WFOE?

Please visit our dedicated page for this purpose at:

https://www.onlinecompanyregister.com/china-company-setup

click on the heading of “Registration of WFOE in Szqh Shenzen Free Trade Zone” and there you will find the registration process.

Q 6: What is the registration fee of a WFOE?

Please visit our dedicated page for this purpose at: 

https://www.onlinecompanyregister.com/china-company-setup

on the heading of “Incorporation Fee”, you shall find the details of registration/incorporation fee.

Q 7: What documents are required for incorporating a WFOE?

Please visit our dedicated page for this purpose at: 

https://www.onlinecompanyregister.com/china-company-setup

click on the heading of “Registration of WFOE in Szqh Shenzen Free Trade Zone” and there you will find the required documents.

Q 8: How long would it take to incorporate the WFOE?

Usually it takes one month to incorporate WFOE.

Q 9: What bank accounts are allowed to open?

Generally, there is no restriction and options are available to you open a bank account in China. However, we will appreciate if you send us the application form so that we may suggest the right bank for you.

Q 10: What is the procedure to open bank account?

Please visit our dedicated page for this purpose at: 

https://www.onlinecompanyregister.com/china-company-setup

click on the heading of “Registration of WFOE in Szqh Shenzen Free Trade Zone” and there you will find the relevant process.

Q 11: What are the banking functions in China?

All banks in China, provides general functions like internet banking, multi-currency transactions and company debit. So, you will be at comfort and may operate your bank through internet banking, while being in your own country.

Q 12: What documents you will get after incorporation?

Following are the documents you will get after incorporation:

  • Business license issued by the State Administration of Industry and Commerce.
  • Issuance and making of chops by Public Security Bureau.
  • You will get the Organization Code issued by the Technical Supervision Bureau.
  • Tax certificate issued by the Tax Bureau.
  • State Administration of Foreign Exchange will issue a Financial Certificate License.
  • RMB and Foreign Currency bank account.
  • Chinese auditor will issue the Capital Verification report.
  • License for the Import or Export.
  • VAT License.
  • Statistics License.

Q 13: What will be the VAT Status of a new setup?

After company formation, you will have a VAT Status of a “small taxpayer”. Please visit 

https://www.onlinecompanyregister.com/china-company-setup

for more details.

Q 14: Is it possible to change to General Taxpayer setup?

Yes it is possible to do so and we can apply for you to upgrade from the Small-scale taxpayer status to General Taxpayer status.

Q 15: What is the taxation system in China?

Please visit:

https://www.onlinecompanyregister.com/china-company-setup

to know about the taxation system in the china.

Q 16: What do I need to pay?

Please visit:

https://www.onlinecompanyregister.com/china-company-setup

to know about the tax you need to pay in China.

Q 17: What are the reporting requirements in China?

Please visit our dedicated page for this purpose at:

https://www.onlinecompanyregister.com/china-company-setup

Q 18: Is it possible to rent office in China?

Yes it is possible to rent office in china.

Q 19: What type of employees would I be able to hire?

You are allowed to hire both local and overseas employees.

Q 20: Can I get my VAT refund?

Yes, you can get your VAT refunded.

Q 21: Can I remit money to my home country?

Once you pay all your taxes in china then you need to apply for clearing out from China and once you get clearing order you will submit this to your bank and then bank will do remittance on your behalf and desired money will be transferred to your bank account, in your home country.

Q 22: I do not speak Mandarin; how would you help me in this regard?

We will arrange a translator for you, who will assist you in all formation and other issues during your stay in China.

Q 23: I cannot read or speak Chinese? What facility could I have in booking a hotel or other matters?

We understand this and we will appreciate if you need our help. Our staff will receive and meet you at the exit of Customs office in China and will bring you to the hotel and will assist you in formation matters and other matters, along with a translator.