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TAX ADVISORY
At PKF, our tax professionals are equipped with strong technical knowledge and industry specific business understanding to help organizations and individuals realize tax efficiencies while meeting the highest standards of compliance.
PKF China is at the forefront of public debate on tax policy and other related matters that affect the wider business community. We are dedicated to partnering with our clients to deliver long-lasting value through our team of people who think beyond the present and beyond borders.
Our experienced team of tax accountants, lawyers and ex-tax officials from around the world can help on a wide spectrum of tax service areas across all major industries including:
2. Tax
We offer compliance and advisory services, including preparation and submission of tax returns for companies and individuals, and negotiations with the tax authorities. We also have dedicated teams to assist you with trade and customs compliance and individual income tax issues for expatriate employees based in the mainland or local employees based overseas.
2.1 China Tax Services
At PKF, we lead the way in tax technical excellence, quality and integrity. With our in-depth knowledge of Hong Kong SAR tax laws and practice, and our extensive experience in international tax work, we offer a wide range of tax compliance and advisory services.

Tax compliance

Adopting a tailored, risk-focused approach, we can help you to manage your corporate tax compliance obligations. These obligations can represent a substantial outflow of funds from a business and become a drain on management time because of increased reporting requirements, a more investigative approach by the tax authorities, and harsher penalties for non-compliance.

Our tax professionals can help to identify ways to reduce your tax charges within the framework of the relevant tax legislation, and deliver services to deal efficiently and effectively with your tax concerns, such as preparation of Profits Tax returns, and assisting in responding and managing queries from the tax authorities.

Tax advisory

With our extensive practical experience and knowledge in individual industry segments, we not only advise on the corporate tax consequences of a particular transaction, but also provide valuable tax advice to enable you to have a complete picture of all the issues, achieve business and tax objectives, and manage risks.

We offer a broad range of tax advisory services with particular expertise in:

•tax audit and investigation

•advance ruling application

•tax "health-check" review

•tax due diligence and structuring

•structured finance transactions

•Securitizations

Merger and acquisition planning
    
•global and regional tax planning

•aircraft leasing arrangements
    
•PE & funds

•US corporate tax

•customs and supply chain management

•global transfer pricing services
    
•international personal tax services

2.2 Hong Kong Tax Services
As the world’s second largest economy, China offers multinational companies (MNCs) rich business opportunities, abundant and productive workforce, increasingly mature infrastructure, and lucrative consumer markets. However, complex Chinese tax laws, heightened scrutiny by the Chinese tax authorities, and a somber economic environment, have created a PRC tax landscape that has never been more challenging for MNCs.
The Chinese tax system is intricate and Chinese tax practices vary from location to location. It is critical that you properly manage the Chinese tax burden, fulfill compliance obligations, and take advantage of the tax benefits that you are entitled to. Other than the tax rules, various government branches routinely issue new regulations that often have a deep impact on cross-border tax planning. Failure to understand the latest regulatory development can create undue tax and business risks and affect the ultimate success of your China operations.
2.3 China's International Tax Services
Services Details
Typical services offered
Tax Compliance
Whether you are a local company or an international organization, PKF can help you handle your employee tax matters. PKF works with employers to ensure employer and employee tax and social security compliance obligations are met, both locally and internationally. Services offered relating to compliance, include:
• estimation of taxes payable;
• preparation of individual tax returns for employees;
• tax compliance for employers (e.g., monthly returns in the PRC, commencement and cessation of employment returns in Hong Kong, etc.);
• social security compliance; and
• advice relating to occupational retirement schemes and other pension plans.

Employer Issues
Our group comprises highly experienced professionals who have a broad knowledge of the complexities inherent in remuneration planning and compliance. For both local and international employers, we can review your current policies and procedures to provide you with advice which not only reflects the current practice in your industry, but fosters efficiency and tax effectiveness of your remuneration arrangements. We have significant experience in:
• employment structures;
• equity based compensation or other incentive awards;
• severance arrangements; and
• Tax audits.

International Human Resources
PKF can assist with the design and delivery of relocation and repatriation policies for domestic and international assignments of short or long duration. We can tailor these policies to the culture of your organization to support the identified business objectives by:
• reviewing current arrangements for frequent business travelers and cross border employees;
• drafting tax equalization or protection policies;
• obtaining residence visas and work permits; and
• Advising on employer and employee compliance obligations when setting up in a new location.
2.4 International Executive Services

The Current Climate

Indirect taxes – value-added tax (VAT), business tax (BT), consumption tax, and customs duties – accounted for almost 75 percent of the collective total tax revenue derived from China in 2011. As such, the management of indirect taxes is an important issue for businesses in China.

With VAT and BT – the two major forms of indirect taxes – now undergoing reform, commencing with a pilot program in Shanghai in 2012, and indirect taxes have taken on even greater significance. PKF has a Centre of Excellence dedicated to assisting clients with VAT reforms and their indirect tax needs.

PKF differentiates itself by assisting clients to recognize that these reforms are a key management issue rather than simply a technical tax issue. As the VAT reforms affect businesses across a number of areas, expertise and assistance across a broad skill set is imperative: pricing to contracts; IT and system changes to training and project management; supply chain management to negotiations with key suppliers; and the management of important customer relationships. Our experience in implementing VAT reforms enables us to bring these skill sets together and add value to your business.

Our service offerings

PKF China has the depth and breadth of experience across all main industry sectors, as well as the ability to apply international best practices to navigate solutions for businesses in China, including practical experience with implementing similar VAT reforms in other countries. We also maintain regular dialogue with China's Ministry of Finance and the State Administration of Taxation to ensure the management of indirect taxes is handled effectively.

Our indirect tax specialists can assist you with:

VAT reforms – including implementation, training, project management, advisory and compliance

Advice on significant transactions such as restructuring and mergers and acquisitions

Identification of key indirect tax opportunities for business including cash flow savings

Health checks to ensure the business is taking advantage of concessions and exemptions, maximizing input VAT credits and deductions and identifying underpayments or process deficiencies

Supporting businesses subject to tax audits or other investigations


Using technology solutions to more efficiently manage indirect taxes, including Enterprise Resource Planning (ERP) systems and linkages to the golden tax system.


2.5 Indirect Tax

PKF's Mergers & Acquisitions (M&A) Tax practice is a part of a network of professionals which combines global understanding and deal experience with local knowledge of tax jurisdictions. We help businesses with cross-border M&A and other transactions.

Our vision is to be the premier provider of M&A tax services with a reputation for outstanding quality, seamless client service and the best people

2.6 Mergers & Acquisitions Tax Services
Our Global Compliance Management Services (GCMS) practice leverages PKF's worldwide experience to provide a range of services to clients considering outsourcing their corporate income tax function.

Today's unprecedented economic challenges are forcing companies to rethink the way they do business. For many, this includes taking a closer look at how they manage their compliance obligations on an international basis. As a result, many companies are looking for more consistent, efficient and cost effective ways to meet their compliance obligations.

PKF's professionals understand the ever-changing and challenging business and regulatory environment, and know how to respond to your evolving needs.

Outsourcing - an attractive option

By outsourcing, an organization can capitalize on the economies of scale, specialized labor and the application of industry best practices (assuring processes are aligned with current regulatory demands) available through an external service provider.

Why PKF?

Our outsourcing professionals think beyond the immediate compliance task to add longer-term value to your organization through our:

Global mindset - Our global service recognizes the international reach of today's businesses and provides effective global client services with local expertise.

Forward thinking - PKF recognizes that outsourcing is a major commitment for both parties and should be a long-term partnership. We seek to build relationships that can change as you develop and improve your compliance processes and relationship with your regulator in the long run.

Value adding - At PKF, we will not relegate your regulatory reporting to a mere process. We aim to provide reassurance around your key filing positions and add value through the identification of better disclosure positions and planning opportunities.

By partnering with PKF, you can improve your compliance processes, technologies and risk management and meet your global compliance obligations while also freeing-up your tax team to focus on supporting your business, both now and in to the future.

PKF's compliance services include:

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Tax compliance and related tax planning

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Tax provision preparation

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Tax authority inquiry and examination

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Compliance process, technology and controls advice

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Project coordination and management

2.7 Global Compliance Management Services

Chinese domestic enterprises encounter a variety of tax issues when expanding overseas. Tax compliance is of paramount importance both from a reputational and cost perspective and each jurisdiction has its own complexities to consider. In addition, there are a number of opportunities to optimize cash flow and maximize value to shareholders through tax efficient planning.

PKF's Outbound Investment from China Group brings together international perspectives and practical experience to provide comprehensive tax services tailored for domestic enterprises seeking to succeed in overseas markets.

2.8 Outbound Investment from China

China has one of the most difficult and challenging tax environments in the world. Mounting pressure for the local tax authorities to generate fiscal revenue has resulted in more tax investigations and larger adjustments, which also increase the exposure for penalties and interest for taxpayers. Furthermore, businesses experienced continued tax uncertainty and unpredictability due to the constant tax regulatory changes in China.

As a result, it is imperative to be proactive with potential tax controversies and to be ready to respond to a local tax investigation. You need to ensure that appropriate strategies for response and compliance are in order to take control of the dispute resolution process.

PKF China has tax specialists to support you in virtually every area of tax dispute and enhance your ability to take control of the dispute resolution process. We combine deep technical knowledge, understanding of local practices, strong relationships with government officials, effective tax negotiation skills and a global perspective to provide you with top-quality services.

2.9 Tax Dispute Resolution

During the last few years, governments in many countries including China have been continuously encouraging good corporate governance and developing guidance for sound tax risk management. Despite these countries’ diverse regulatory and business environments, they all come to the understanding that an effective tax risk management system is vital for both tax authorities and large taxpayers. ‪

Due to rapid economic growth and limited government resources, the tax authorities in China started to focus on the tax administration of large-scale enterprises in recent years. Since 2009, a series of regulations are issued to address the tax administration in this regard.

PKF China’s Tax Risk Management Services team can provide a range of services to you to develop and implement an effective tax risk management system within your organization, like work with management to assess the challenges facing, stress test the existing tax governance framework and control environment across the taxes to assess its adequacy and identify sustainable enhancements

2.10 Tax Risk Management

The Chinese government has been encouraging and promoting research and development (R&D) for over ten years by offering tax incentives to PRC enterprises who conduct R&D activities. A good understanding of R&D tax incentives can lead to significant tax savings for your business.

PKF has an established practice and capability in assisting you in identifying R&D incentives and eligibility criteria and can assist your business to better access R&D incentive opportunities.

2.11 R&D Tax Practice
US Corporate Tax Services can help organizations achieve tax efficiency in their US inbound and outbound operations on transactions involving the US. With a global perspective and local expertise, our professionals provide practical tax advice on establishing new ventures, structuring overseas transactions, and maintaining compliance with tax regulations.

Our US tax professionals can assist clients in building global competitive advantage through tax-effective structuring of their international business operations. Our capabilities are further enhanced by access to tax resources in over 140 countries worldwide among PKF's member firms.

The specialist group provides US taxation advice in the following areas:

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Mergers and Acquisitions Structuring

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Tax Due Diligence

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Funds (Investment, Private Equity, Sovereign Wealth)

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Capital Markets

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Corporate and Business Tax Compliance

Companies at every stage of global growth can benefit from our experience. PKF provides valuable assistance to companies that are:

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Establishing new US operations or joint ventures with US partners

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Creating distribution networks or brand through foreign subsidiaries

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Manufacturing in the US or other countries

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Integrating global operations

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Transferring tangible or intangible property

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Seeking to enter or exit foreign markets

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Investing into or disposing of investments in the United States

2.12 US Corporate Tax

·         Identify and seize opportunities of tax efficiency

·         Evaluate and manage tax risk

·         Optimize tax structure of the deal

2.13 Tax Due Diligence
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