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Enquiry: What is the Way to Secure High-tech Enterprise Status and Enjoy Preferential Income Tax Treatment?

Photo: High-tech enterprise
Photo: High-tech enterprise

Under the existing tax incentive scheme, any business is entitled to pay the reduced 15% rate of corporate income tax (the standard rate is 25%) once it has been accorded high-tech enterprise status. According to the prevailing legislation, Administrative Measures for the Accreditation of High-Tech Enterprises, qualifying businesses must have been resident and registered in China (excluding Hong Kong, Macau and Taiwan) for at least one year. They must also be able to demonstrate a sustained commitment to research and development, as well as the subsequent commercialisation of the results of any such activities. In an additional requirement, they must also be the rights-holders of their core intellectual properties.

Qualifying enterprises should complete the Enterprise Registration Form and submit the required materials online at www.innocom.gov.cn. Once their registration has been verified by the system and their account has been activated, they may then submit their accreditation application.

In order to secure accreditation, enterprises must comply with the following requirements:

  • They must have been registered for at least one year at the time the application is submitted.
  • They must be the rights-holders of the intellectual property relating to the key technologies appertaining to their primary products/services. Such rights can have been obtained through independent R&D, technology transfer, donation, merger/acquisition, possession of an exclusive licence for five or more years or any other acceptable means.
  • The technology appertaining to their key products must fall within one of the high-tech sectors designated for priority development at the state level.
  • The percentage of technical staff directly involved with R&D, related technology or other innovation-oriented activities in any given year must be no less than 10% of the total number of staff employed.

Documents required for accreditation applications:

  • High-Tech Enterprise Accreditation Application Form
  • Duplicate copy of Business Licence
  • Intellectual property-related materials, scientific research project certification, and any information relating to the commercialisation of research achievements and the organisation and management of research and development
  • Details of key technologies and the technical specifications of high-tech products/services, production approval certification, accreditation documents, qualification certificates, product quality inspection reports and any other material regarded as pertinent to the application

For further details, please refer to the following:

Administrative Measures for the Accreditation of High-Tech Enterprises (Guo Ke Fa Huo No. 32 [2016]) (Chinese)

High-Tech Enterprise Tax Incentive Eligibility Updated

Content provided by Picture: HKTDC Research