The Eyes on China Monthly

November 2009

1. Payroll Processing Made Simple
2. Temporary Extension of Incentives to Incorporate in Hong Kong
3. Eyes on China Managing Director Interviewed on CRI

1. Payroll Processing Made Simple

Companies setting up in China are frequently advised (also by this company) to have thorough accounting, bookkeeping as well as tax filing services attached to their venture.  Even a seemingly minor deviation from the status quo of regulatory compliance could open a Pandora’s Box of consequences. In this regard, one should not neglect payroll processing.  Accurate calculations of salaries, registration of new hires with the Chinese authorities as well as tax filing are essential to keep an organisation running smoothly.  So what are the advantages of outsourcing your payroll administration?

First and foremost, not having to deal with the paperwork and administration of ensuring your employees are paid adequately and on time is work out of your hands. Especially with regard to foreign payroll administration in China, there are a variety of related services that differ from the home country, such as the filing of a new hire report to the relevant authorities and completion of all necessary payroll taxes.

Secondly, outsourcing your company’s payroll needs is an efficient way to avoid dealing with – or even not being aware of – unexpected legal issues that can arise in a foreign country.  Particularly when it comes to the issue of taxes, without good relations, which can take years to develop, competition with well-established local companies can be one-sided.

In order to keep any organisation successful, payroll, accountancy, and tax services are a must, regardless of whether these services are completed internally or externally.  Outsourcing these services can simplify and secure your company’s operations in China.

2. Temporary Extension of Incentives to Incorporate in Hong Kong

Hong Kong has long been attractive to international companies seeking a (more flexible) centre of operations near mainland China. Incorporating in Hong Kong offers many advantages, including the opportunity to transfer revenue to other countries.  Now, the government is offering even more incentive to establish a company in Hong Kong.  Through July 2010, the fees for incorporating in Hong Kong have been significantly reduced. Furthermore, in some instances, it is possible to incorporate with as little capital as 1 HKD.As an advisory company that has been incorporating businesses in Hong Kong since 2003, we have always told our clients of the incentives to establish a company in Hong Kong, but the incorporation process has never before been so enticing.

3.Eyes on China Managing Director Interviewed on CRI

Due to his extensive experience in China and other developing countries, particularly countries in Latin America, Marco van der Putten, the managing director of Eyes on China, was recently interviewed by China Radio International to discuss the applicability of the so-called Beijing Consensus. Mr. van der Putten commented on the issues surrounding the universal use of a copy/paste economic development model without regard to the specific issues of each nation. Mr. van der Putten was quoted as saying, “China’s success is really seen as a “yes, we can” type of proof for their economic development model, and the additional fact that China has actually proven some good will toward other countries only rallies support for their model.  Although copy/pasting developmental economics models into other systems can lead to good results, one must not ignore the social/economics/cultural characteristics of that country; for example, you cannot expect that all cultures are as pragmatic as the culture of China.” China Radio International frequently invites Marco van der Putten to speak about issues surrounding Chinese business and economic development.

Disclaimer

The information provided above does not represent legal or financial advice, and neither Eyes on China nor her subsidiaries shall be held liable for its contents. For more information, please contact Eyes on China at +86 (0)10 65880899.