受益所有人判定规则在中国的必威体育精装版发展(英文版).pdf

The Latest Development on the “Beneficial Owner Rules” in China According to the Double Taxation Treaties (“DTA”) entered into by the PRC and other countries / regions, the non-resident recipient in other contracting state may apply for the treaty benefits available for dividend, interest and royalties only if it qualifies as the beneficial owner of the mentioned passive income. On October 2009, the State Administration of Taxation (“SAT”) issued the Guo Shui Han [2009] No. 601 (“Circular 601”) to lay down the basic principle on the identification of the beneficial owner of the applicant. Circular 601 emphasizes that the identification of the beneficial owner shall comply with the principle of “substance over form”, and lists seven negative factors that unfavorable for the identification of the beneficial owner. The provisions of Circular 601 are generally in line with the principle as set out in the OECD Tax Treaty Commentary. However, the provisions of Circular 601 are too general and lead to different interpretation and tax treatment by the tax authority in certain extent, and give rise to a lot of uncertainty to the taxpayer. For example, in practice, the same taxpayer may get different results for the application of the beneficial owner status from different tax authorities, under which one tax authority may deny its application on the grounds of lack of the beneficial owner status and the other tax authority may confirm its beneficial owner status. In response to the issues encountered in practice, the SAT issued an Announcement titled as the “Announcement on the Identification of the Beneficial Owner in the DTA (“Announcement [2012] No. 30”), to provide further guidance for the identification of the beneficial owner. We below summarized the key points of Announcement [2012] No. 30 and shared our observation and opinion to th