Developments in Permanent Establishment of Greek companies operating in China
The controls of Permanent Establishment in China are getting stricter
The opportunities presented in the Chinese market have driven many Greek companies to show strong presence in China.
Until recently, the Chinese authorities were not so active or strict in their controls towards foreign companies regarding whether or not these foreign companies are permanently established in China. However, recently the authorities have intensified their controls checking the existence or not of permanent establishment and it is expected that this practice will become stricter, often and systematic.
These strict controls that Chinese authorities are issuing, require companies operating there to assess risks under the current frameworks.
This article highlights the consequences of these strict controls on behalf of Chinese tax authorities and aims to respond to the following questions:
• What changes?
• Which companies are subject to taxation?
• What is the related taxation?