As China’s digital economy continues to grow rapidly, the State Taxation Administration (STA) has tightened its regulations on internet platform enterprises. The recently introduced tax reporting requirements for internet platforms clearly outline the obligations for overseas companies operating in or with China.
For foreign platforms looking to enter or expand in the Chinese market, understanding and complying with these new rules is essential. This article explains the key requirements and offers practical guidance on how overseas internet platforms can achieve China tax compliance efficiently.
Who Is Responsible for Submitting Tax Information?
According to the new regulations, overseas internet platforms fall under different scenarios:
- Overseas platforms with a licensed local entity: If the platform has set up a Chinese operating entity and obtained a Value-Added Telecom Business License (VATBL), that entity is responsible for tax reporting.
- Overseas platforms with a local entity but no license: If the local operating entity has not yet obtained the license, the responsibility shifts to the domestic service providers who handle merchant onboarding, store operations, or marketing services.
- Overseas platforms with no local presence: If no operating entity exists in China, the overseas platform must appoint a designated Chinese tax agent to submit the required tax information on its behalf.
This means that even without a registered company in China, foreign internet platforms cannot avoid their tax compliance obligations.
The Process of Tax Information Reporting for Internet Platforms
Tax reporting is not a single step but rather a complete process that includes data collection, preparation, submission, and follow-up. Understanding this process highlights why a reliable agent in China is critical for foreign platforms.
Step 1: Data Collection
Platforms must collect key data from Chinese merchants and Chinese workers on the platform, including transaction records, commissions and fees, merchant registration details, taxpayer identification numbers, and identity or business licenses.
Step 2: System Submission
After verification, the information must be uploaded via the STA’s designated online reporting system. This step often requires technical access, encryption, and system familiarity—tasks that typically can only be carried out by a local licensed entity or authorized agent.
Step 3: Follow-Up and Feedback
Once submitted, tax authorities may request additional documentation or clarification of unusual transactions. The platform (or its local tax agent) must provide timely responses and maintain a complete record of all submissions for compliance checks.
Although these steps may sound straightforward, in practice they demand in-depth knowledge of Chinese tax policies and technical expertise in reporting systems. For foreign companies doing business in China without a local entity, working with a designated Chinese tax agent is the only viable solution.
How Hongda Helps Overseas Platforms Achieve Compliance
At Hongda, we provide end-to-end solutions to help overseas internet platforms comply with Chinese tax reporting requirements. Our services include:
- Tax agent services: acting as your designated Chinese tax agent, we handle all reporting on your behalf.
- Professional compliance team: our experts are well-versed in China’s tax policies and cross-border e-commerce compliance requirements.
- Risk reduction: ensuring timely, accurate submissions to prevent penalties or business interruptions.
- Tailored solutions: customized compliance support for platforms of different sizes and industries.
If your overseas platform does not yet have a local entity in China or a qualified tax agent, Hongda can serve as your trusted partner. We ensure your platform meets all compliance requirements while you focus on growing your business in the Chinese market.
Conclusion
China’s strengthened regulations mark a new stage of oversight for the digital economy and cross-border platforms. For overseas internet platforms, it is no longer optional to comply with tax information reporting in China—it is mandatory.
By partnering with Hongda, you can secure a reliable compliance solution, minimize risks, and maintain smooth operations in one of the world’s largest online markets.
