China Stamp Duty Reminders

Published on 2021-08-18
  1. Are all contracts subject to stamp duty?
    No, stamp duty is only applicable to the categories listed in the Stamp Duty regulation. Others not listed are not subject to stamp duty.
  2. If a contract is not executed, is it subject to the stamp duty?
    No, stamp duty should be recognized when the contract is signed regardless the contract execution status.
  3. If the contract amount cannot be determined when the contract is signed, there would be no need to pay the tax?
    No, RMB 5 for the stamp duty should be paid. Then, when actual contract amount is determined, the stamp duty can be reconciled.
  4. If there is no contract, then there is no need to pay stamp duty?
    No, as long as there are written transaction evidences for the trading parties’ rights and obligations, even though some contract elements are not in place, stamp duty must be paid.
  5. Does stamp duty need to be paid every year for the paid-in capital?
    No, if there is no increase in the paid-in capital.
  6. How is stamp duty paid for the paid-in capital increases?
    It is calculated at 0.05% of the increase of both paid-in capital and capital reserve.
  7. Stamp duty is required if the registered capital has not been injected?
    No, stamp duty is only applied to the amounts actually injected, i.e., the paid-in capital and capital reserve.
  8. Is the stamp duty calculated on the basis of the contract amount including VAT?
    It depends. If the contract amount and the VAT are specified separately, then taxable amount is the contract amount without VAT. If the VATis not stated separately, the taxable amount is contract amount including VAT.
  9. When should we pay the stamp duty if the taxable contract is signed outside China?
    Stamp duty should be paid when the contract is used within PR China.