Announcement on Matters Concerning the "Chinese Tax Resident Certificate"

I. Background of the Announcement

With the accelerating pace of Chinese taxpayers "going global," investment destinations have expanded, and participation in overseas economic activities has deepened. Consequently, the need for the Chinese Tax Resident Certificate (hereinafter referred to as the "Certificate") has grown significantly, necessitating updates to existing policies.

To implement the guiding principles of the 20th CPC National Congress and the Third Plenary Session of the 20th CPC Central Committee, and to better support high-quality international expansion, the State Taxation Administration (STA) has issued this Announcement to facilitate cross-border operations for Chinese residents.

1. The Certificate serves as a crucial document for proving Chinese tax residency abroad—essentially a "tax passport" for Chinese residents. Its primary use is to claim benefits under tax treaties. China has signed tax treaties with 114 countries and regions, forming one of the world’s largest treaty networks, which underscores the Certificate’s high practical value.

II. Key Optimizations in the Announcement

1. Expanded Application Scenarios

   Applicants must specify whether the Certificate is for tax treaty benefits or non-treaty purposes (e.g., compliance with foreign regulations).

2. Full Online Processing

   Enterprises and individuals can now apply via the E-Tax Bureau or Natural Person E-Tax Bureau portals, streamlining the process.

3. Revised Certificate Content

   Added: Taxpayer Identification Number (TIN).

   Removed: Signature of the tax authority’s responsible officer.

   Optional: Notes on partnership enterprises to accommodate specific needs.

4. Reduced Processing Time

   If tax residency can be determined directly by authorities, processing time is shortened from 10 to 7 working days.

III. Application Channels

• For Enterprises: Apply online via the E-Tax Bureau or in person at the local tax office.

• For Individuals: Apply online via the Natural Person E-Tax Bureau or in person at the local tax office.

IV. Eligibility for Branches and Entities

• Branches of Chinese resident enterprises (domestic/overseas) cannot independently apply. The head office must apply on their behalf.

• Individual businesses, sole proprietorships, and partnerships registered in China must apply through their Chinese resident owners/partners.

V. Choosing the Application Purpose

1. For Tax Treaty Benefits

   Definition: Used to claim preferential tax rates (e.g., reduced withholding taxes on dividends, interest, royalties) under bilateral treaties.

   Scenarios: Cross-border investment, profit repatriation, tax exemption on overseas service income.

   Required Documents: Contracts, payment vouchers, board resolutions related to the income.

2. For Non-Treaty Purposes

   Definition: Proves tax residency for compliance or business needs (e.g., bank account opening, overseas listings).

   Scenarios: CRS compliance, foreign IPO requirements, legal disputes, overseas project bidding.

   Required Documents: Official requests from foreign authorities or evidence of the application’s purpose.

3. Key Considerations

   Clarify Requirements: Match the purpose with the foreign jurisdiction’s demands.

   Avoid Misclassification: Incorrect selection may lead to audit risks or missed tax benefits.

4. Practical Advice

   Assess Needs Dynamically: The Certificate’s role has expanded beyond treaties to general compliance.

   Retain Supporting Documents: Even for non-treaty uses, preserve foreign requests for future reference.

VI. Effective Date

The Announcement takes effect on April 1, 2025, replacing previous regulations (STA Announcements No. 40/2016 and No. 17/2019).

Conclusion: This update reflects a shift from "treaty-focused" to "comprehensive compliance" in cross-border tax management. Taxpayers should align applications with actual needs to balance disclosure and compliance.

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