In our June 2022 Issue of Newsletter, we will discuss some of the important updates in PRC Tax in the first half of 2022.1.  Limitation on Use of Capital for Wholly Foreign Owned Enterprise (“WFOE”) in Mainland ChinaThe use of WFOE’s Registered Capital for Non-Self-use Property and Listed Stock Investment is strictly forbidden in Mainland ChinaIn May 2022, the State

Limitation on Use of Capital for Wholly Foreign Owned Enterprise (“WFOE”) in Mainland China

Let me read a court case in Mainland China...鈺基國際貿易(上海)有限公司 (“the Company”) has acquired a rented property (“the Property”) located in Shanghai. The purchase funds came from its share capital.  Before the acquisition, the Property had already been rented out. After the acquisition, the Company signed a tenancy agreement with the existing tenant and generated rental income. The court determined that

Court Case Study: Prohibited usages of Share Capital of WFOE