财政部 税务总局 商务部关于境外投资者以分配利润直接投资税收抵免政策的公告公告2025年第2号

Core Viewpoint - The announcement outlines a tax credit policy for foreign investors reinvesting profits distributed by Chinese resident enterprises, effective from January 1, 2025, to December 31, 2028, allowing a 10% tax credit on the reinvestment amount against the annual taxable income of foreign investors [2][7]. Summary by Sections Tax Credit Policy - Foreign investors can offset 10% of their reinvestment amount against their taxable income if the profits are reinvested in eligible domestic investments from January 1, 2025, to December 31, 2028 [2][3]. - If the tax treaty with a foreign government stipulates a lower tax rate on dividends and similar income, that rate will apply [2]. Eligibility Criteria - The profits must be actual distributions from Chinese resident enterprises, classified as dividends or similar equity income [2]. - Eligible reinvestments include capital increases, new establishments, and equity acquisitions, excluding stock purchases of listed companies (with some strategic investment exceptions) [2][3]. - The reinvestment must be in industries listed in the "Encouraged Foreign Investment Industry Catalog" [3]. - Foreign investors must hold the reinvested assets for at least 5 years [3]. Payment and Documentation - Profits used for reinvestment must be paid in cash directly from the profit-distributing enterprise to the invested enterprise, without prior circulation in other accounts [3]. - Documentation must be provided to the profit-distributing enterprise to avoid withholding tax on the reinvested profits [4]. Withdrawal and Tax Obligations - After 5 years, if foreign investors withdraw their investments, they must report and pay any deferred taxes within 7 days [5]. - If investments are withdrawn before 5 years, the tax benefits will be recalibrated, and any excess credits must be repaid [5]. Reporting Requirements - Foreign investors must report their reinvestment details through a unified platform managed by the Ministry of Commerce, including information about the invested enterprises and the amounts involved [5][6]. - The local commerce department will verify the submitted information and report to the provincial level [6]. Special Conditions - If the invested enterprise undergoes a restructuring that meets specific conditions, the tax credit policy can still be applied [6]. Implementation Timeline - The policy is effective from January 1, 2025, to December 31, 2028, with provisions for any remaining tax credits to be utilized until exhausted [7].