US perspectives on China’s new cost sharing rules
September 29, 2008
Patrick Breslin from The Ballentine Barbera Group reports on the potential problems of US-Chinese cost sharing arrangements
Article 41 of China’s corporate income tax (CIT) Law—effective January 1 2008—formally recognises cost sharing arrangements (CSAs) involving Chinese affiliates. This comes on the heels of last year’s strict IRS enforcement guidance on CSAs, which remains the top IRS audit issue. China’s State Administration of Taxation (SAT) could eventually enter contentious territory where US-Chinese CSA participation is concerned.
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