Nanjing WFOE Company Registration – FAQs mel2cn.east

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E-mail: mel2cn@evershinecpa.com

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Other Services in Nanjing

Q: What is the service coverage of Evershine in Nanjing Company Registration?

*Company Registration

*Trademark Registration
*Work Permit Application
*China Z-Visa Application
*Work Certificate Application
*Residence Permit Application

Q: How to assess what kind of entity to register in Nanjing?

1) Representative Office
1.1 RO can be used to pay out expenditure to vendors and employees.
1.2 Its aim is to handle the issues with payroll compliance when recruiting employees.
1.3 Not allowed to issue local invoices.
1.4 Sales is directed to the parent company.
1.5 It must confine its activities to acting liaison office on behalf of its parent company.

2) Service WFOE
2.1 Legal entity and independent Chinese domestic company, but wholly owned by foreigners.
2.2 Suitable for a business to provide services like consultation, software, design etc.
2.3 Excludes the buy-and-sell of goods.
2.4 Can only issue sales invoice with 3% or 6% tax, excluding VAT invoice.
2.5 May be used to pay out all expenditures.
2.6 It needs to obtain approval from 7 relevant Government Authorities in Nanjing.
2.7 Some industries would require special approval from more authorities.

3) Trading WFOE
3.1 Legal entity and independent Chinese domestic company, but wholly owned by foreigners.
3.2 Includes the buy-and-sell of goods, excluding manufacturing goods.
3.3 May also provide service.
3.4 Can only issue VAT invoice with 17% or 6%.
3.5 May be used to pay out all expenditures.
3.6 It needs to obtain approval from 8 relevant Government Authorities in Nanjing.
3.7 Some industries would require special approval from more authorities.

4) Manufacturing WFOE
4.1 Legal entity and independent Chinese domestic company, but wholly owned by foreigners.
4.2 Manufactures goods.
4.3 Includes the buy-and-sell of goods
4.4 May also provide service.
4.5 Can only issue VAT invoice with 17% or 6%.
4.6 May be used to pay out all expenditures.
4.7  It needs to obtain approval from 10 relevant Government Authorities in Nanjing.
4.8 Some industries would require special approval from more authorities.

5) Joint Venture with Local Partner
5.1 It is a legal entity and independent china domestic company.
5.2 Only a China existent company can be your Local Partner
5.3 China natural persons can not directly be your local partner
5.4 It can be in Service industry, or Trading Industry or Manufacturing industry

Please note that if the company register place is over 300sqm, a special approval from the fire department is needed.

Q: What is the minimum capital of a Nanjing WFOE?

Service WFOE’s minimum capital is RMB100,000 as required by the Local Foreign Investment Bureau.

While the minimum capital of a Trading WFOE is RMB 500,000 as a requirement of the Local Foreign Investment Bureau.

As for how much capital will pass, it will depend on the trading products and business activities you put into your business scope; the more products you offer, the higher registered capital will be required.

If your employees would like to apply China Z visa, minimum capital of RMB 3million is required for a Service WFOE or Trading WFOE. A Manufacturing WFOE will only be required of RMB 1million min. capital.

Q: Who can be shareholders, directors/legal representative and supervisor?

Any foreign individual or entity can be shareholder. However, Chinese citizens can not be one of your shareholders, only Chinese local company. A legal representative, manager and supervisor are needed to register a new company in China. They can be foreigners or Chinese locals. Legal representative and manager can be the same person although supervisor must be independent.

Q: Who are the legal representative and supervisor? What kinds of roles do they undertake?

The legal representative is the main principal of the company who holds a legal power to enter into binding contracts and obligations on behalf of the entity in accordance with the law or the Articles of Incorporation. His/her acts are binding with the entity when entering in to a contract.

The main role of the supervisor is to safeguard and supervise the smooth and lawful operation of the company. The law has delegated him/her rights such as inspecting the company’s finances, supervising the company directors and senior managers, recommending dismissal of directors etc.

To act as the legal representative/supervisor he/she shall not satisfy any of the following conditions and, in practice, the company registry authority will also review those conditions:
(1) Without civil capacity or with only limited civil capacity;
(2) Pursued with criminal punishment or other criminal compulsory measures;
(3) Ordered for arrest by public security bureau;
(4) Been sentenced to any criminal punishment due to an offense of corruption, bribery, encroachment, misappropriation of property or disrupting the economic order of the socialist market and five years have not elapsed since the completion of the execution of the punishment;
(5) Was a former director, factory director or manager of a company or enterprise which was bankrupt and liquidated, whereby he/she was personally liable thereof, and three years have not elapsed since the bankruptcy and liquidation;
(6) Was a legal representative of a company/enterprise, but the business license thereof was revoked and this company or enterprise was ordered to close due to violation of the law, whereby he/she was personally liable thereof, and three years have not elapsed since the revocation of the business license; or
(7) Has a relatively large amount of debt which is due but unclear.

Q: What kinds of work permit and china visa can be applied when completing a set up of WFOE?

Apply Work Permit-> Apply Z visa (employment visa)-> Apply Work Certificate-> Apply Residence Permit

Each shareholders in your WFOE, as investors, can apply Work Permit, China Z-visa, Work Certificate and Residence Permit. Their spouses and children may accompany them.

If your employees would like to apply China Z visa, a Service or Trading WFOE with minimum capital of RMB 3million will be qualified. While a Manufacturing WFOE will only be required of RMB 1million.

Work Permit: To get work permit, you need to provide foreigners’ resume and qualifications certificate (degree certificates and professional skills qualification certificate and two years or above related working experience); valid passport photocopy; health certificate issued by the Chinese embassies, consulates, the authentication of foreign medical organization or the Chinese government appointed health and quarantine departments.

Z-visa: Issued to those coming to China for employment. To get a Z-visa, you’ll need to submit a Work Permit or a Foreign Expert’s License, obtained by the company in China you will be working for, and a letter of invitation from your employer, as well as the marriage certificate and birth certificates for accompanying spouse and children, respectively. In application for Z-visa, foreigners shall, depending on different situations, provide the Foreigner Employment Permit of People’s Republic of China (obtained from labor and personnel departments of province, autonomous regions or municipalities directly under the central government by employer organizations in China), or a company representative certificate in China, or a telegram from an authorized organization, or an approval from Ministry of Culture of People’s Republic of China, or visa application letters issued by foreign affairs office of province, autonomous regions or municipalities directly under the central government.

Work Certificate: Obtained from labor and personnel departments of the province.

Residence Permit: It is not the visa but the residence permit that gives you the legal right to live in China. Once you arrive in China, you’ll have 30 days to secure your residence permit. Your initial visa will expire within a few months, but your residence permit will function like a multiple-entry visa, allowing you to leave the country and return without an additional visa as long as the permit is valid. The Foreigner Residence Permit, typically good for one year and renewable annually, is a standard issue for the majority of foreigners working in China, though some (such as company executives, legal representatives, or investors) qualify for a permit that is good for two years. With a valid residence permit you are allowed to leave the country and return, even if your initial entry visa has expired. Accompanying spouse and children are given the same type of visa and residence permit as the one who will be employed in China, though each family member will have to fill out an individual application and pay the application fees. If the stork should find you in China, you’ll need to bring your new baby’s birth certificate to the local PSB for registration.

If you have an employment visa and residency based on a family member’s employment, you may find your own employment while in China. However, your new employer will then have to register your employment and file the necessary paperwork to make it legal.

Q: What are the service charges and out-of-pocket expenses?

Setting up a Service WFOE is US$3500, Trading WFOE is US$3800 & a manufacturing WFOE is US$4800. Aside from out-of-pocket expenses which are about US$330-US$660. Aforementioned fees excludes special permit application fee.

If you need us to arrange a virtual registered office for trading industry, where it’s allowed to issue General GUI (General Unified Invoices), it will be a one-time charge of RMB20000 for the first 12 months (about US$3200).

For service and consultation industry, it’s a one-time charge of RMB10000 for the first 12 months (about US$1600).

For application of Work permit, Z-visa, Work Certificate to Resident Certificate, service fee will be in one application per person (USD700). For dependents, service fee = USD700+(applicant number minus first one)*USD300. Government fees (RMB2000 = USD333) for each applicant shall apply.

Out-of-pocket expenses: handling fees during company set up including transportation, stamp, express, etc.

Final fee breakdown will be included in the signed Engagement Letter.

Q: How can Evershine serve you? What are the processes?

The procedures to register an WFOE (Wholly Foreign Owned Entity) are:
Require → Consult → Engage → Register

We always allow Taipei HQ staff to join the consulting period until Engagement letter signing as company structure is usually relevant to international tax Planning issues. Evershine will provide general information, if thorough research is required, an hourly rate of US$100 shall apply.

Based on out internal SOP, we need to do the so-called KYC (Know your Client) to check if we are capable to serve you and how to meet your expectations.

Engagement Letter will include all the detailed procedures, required documents, service fee, out-of pocket expenses, etc.

After your signing of Engagement letter, a retainer fee shall be required.

Then, our Nanjing staff will execute registering procedures.

During the execution period, we will use the BPM (Business Process Management) system to monitor service-deliver time and documents’ quality.

After finishing the company registration, we will bill you the final service fee and out-of-pocket expenses.

Q: After obtaining company license, what kinds of services can Evershine provide?

After-Set Up Cloud Accounting, Tax and Payroll Compliance Services:
*Accounting service using Cloud collaboration system
*Cashier role as ”Maker” in your internet-banking account
*China Tax Compliance services
*Payroll Compliance services

We will act as your in-house accountant in your Nanjing subsidiary. When you adopt our services, we will use our proprietary Cloud platform to build up a collaborative working environment among your staff and Evershine staff.
Any authorized person can key-in, review, approve and query anytime, anywhere!

We use BPM Business Process Management) system to monitor service quality including of on-time delivery and correctness. Our business model has been providing very high quality services at a competitive cost. Several hundreds of MNCs (Multi-National Company) are our clients. Client list will be provided upon request.

For more information, please don’t hesitate to contact us.

Q: How to expedite Nanjing Company Registration processes?

Please send an email to jerrychu@evershinecpa.com with answers to below questions:
1) What is your business category? Is it Service, Consultation, Trade or Manufacture?
2) What are your business items? We need to assess if it requires special permit industry.
3) What is your business model? What is your revenue source? Please send a link to your website.
4) How are your shareholders composed? Where is your parent company established? Are the shareholders companies or individuals?
5) Do you have your own registered address already? If not, how much time do you need to locate your own address? Do we need to arrange a virtual registered office for you during the initial period?
6) What are your company phone numbers and your personal phone number? We may discuss over the phone, if necessary.

Q: Where are the service territories of Evershine?

Evershine has its 100% owned office to provide you services in:
Taipei, Beijing, Shanghai, Xiamen, Hangzhou, San Francisco, Seoul, UAE

We have been catering our services with our partners in:
Kaohsiung Taiwan, Singapore, Hong Kong,  Seoul Korea Tokyo Japan, Hangzhou China,
Nanjing China, Guangzhou China, Kuala Lumpur Malaysia, San Francisco USA

We can arrange co-serving partners for other locations not mentioned above, please click the links to find out more: IAPA Members and LEA Members. There are many Evershine CPAs Firm assoicates around the world. We have around 980 firms with 38,000 employees in about 450 cities. If your firms are located in the above-mentioned cities, we can serve you right away.

Please send email to HQ4mel@evershinecpa.com

You may also call:
Manager Bing Weng, UK Graduate School Alumni and a well-English speaker
Mobile: +86-180-5008-2372

For investment structure relevant with multi-national tax planning and Financial & Legal Due Diligence for M&A (Merge and Acquisition), send an email to HQ4mel@evershinecpa.com & contact Dale Chen, Principal Partner/CPA in Taiwan+China+UK, AIA, & over-all responsible for these arrangements.
linkedin address:Dale Chen Linkedin