The Research On Income Tax Of Indirect Equity Transfer Of Non-resident Enterprises In The Demolition Of VIE Structure

In the early 20th century,China’s domestic capital market has just started.Because of the difficult domestic market environment,a number of companies make choices on building a vie structure for overseas listing.Recently,China has changed a lot.The government continues to release dividend policy,domestic listing and financing are more convenient.Compared with the poor living environment abroad,many Chinese concept stocks chose to dismantle the vie structure and return to domestic listing,changing the current situation of difficult overseas financing and low valuation.However,there are many problems in the process of dismantling the vie structure and returning to domestic listing,comprising tax problem,especially the income tax about the indirect shareholding transfer of non-resident enterprises.Since the promulgation of Announcement No.7 and Announcement No.37 on the income tax policies of non-resident enterprises,the state has paid more attention to safeguarding China’s tax sovereignty and rights and interests,and the tax authorities have increased their monitoring of enterprises’ evasion of tax payment through the transfer of equity by overseas middle-tier companies.VIE enterprises are facing greater regulatory pressure in the process of dismantling the structure.Faced with this environmental background,VIE enterprises need to analyze the income tax problems existing in the indirect equity transfer of non-resident enterprises in the process of dismantling the structure,and find appropriate ways to prevent risks.Based on this background,this paper takes "Research on Income Tax of Indirect Equity Transfer of Non-resident Enterprises in the Demolition of VIE Structure" as the theme to conduct case analysis and research.Taking the dismantling of VIE structure of H company as the case study object,it is mainly based on the analysis of tax disputes between tax authorities and enterprises in the process of dismantling VIE structure of H company,and finds out the problems existing in the income tax management of indirect equity transfer of non-resident enterprises in China,and puts forward relevant tax risk prevention suggestions for enterprises.First of all,by understanding the process of building and dismantling VIE architecture of H company,the income tax problems that need attention in the transaction process of H company are introduced;secondly,it deeply analyzes the disputes between H company and tax authorities in the determination of indirect equity transfer of non-resident enterprises,and summarizes the problems existing in China’s related income tax management through the disputes;finally,according to the problems found in the above-mentioned case analysis,some countermeasures are put forward,such as ensuring that the transaction arrangement has reasonable commercial purpose,making reasonable tax planning,actively responding to tax adjustment,strengthening the enterprise’s tax information declaration awareness,and making rational use of international tax agreements.