The basics
Tax optimization and risk management are some of the key challenges that all entrepreneurs should never ignore. In this rapidly evolving environment, business owners in China need to consistently meet the legal requirements regarding tax compliance to reduce tax risks while trying to optimize their structure for greater benefit margins.
Hongda provides a one-stop tax business solution covering the wide range of taxes in China, including income taxes, indirect taxes, and real estate-related taxes.
VAT, corporate income tax, and personal income tax are the three most scrutinized taxes during tax audits.
Is it right for you?
This service is for WFOEs, foreign-invested enterprises, trading companies, and finance leaders that need China tax filings, VAT/CIT coordination, and accounting records to stay aligned with real business activity.
Tax risk review works best when bookkeeping records are organized, so the tax position can be checked against invoices, bank activity, and monthly records. It does not replace bookkeeping work.
Scope
Hongda’s tax optimization services include corporate and business taxation advisory and cross-border taxation advisory:
Missed filings, mismatched invoices, unclear expense records, and late reporting can make management decisions harder and increase the cost of fixing problems later.
How it works
Quick answer: tax risk control runs in four stages: review, gap check, filing coordination and escalation. Select a stage for detail.
Stage 1 of 4
Review the company status, filing routine, invoice flow, and accounting handover.
Stage 2 of 4
Identify gaps between contracts, fapiao, bank activity, and monthly records.
Stage 3 of 4
Coordinate tax filing questions with China bookkeeping and tax filing support where records need cleanup.
Stage 4 of 4
Flag finance-control issues that may need CFO outsourcing in China or entity-level review such as WFOE registration in China.
Hongda can help you review the risk trail and decide what should be checked first.
Risk factors
Tax risk monitoring and management plays a significant role in standardizing corporate behavior, reducing tax costs, enhancing operational efficiency, and avoiding tax risks throughout the whole lifecycle of a company in China.
Incentives and compliance
By obtaining “High-Tech Enterprise” certification, companies can benefit from a 15% corporate income tax rate. Companies should also explore local government tax incentives, such as tax reductions or exemptions. When applying for tax incentives, it is essential to provide comprehensive supporting documents, such as technical reports and financial audit statements.
Companies should conduct regular internal tax audits to ensure the accuracy of tax filings and financial records, particularly focusing on revenue recognition and expense accounting. All sales and purchase invoices should comply with regulations to avoid the risk of fraudulent invoicing. Companies should also proactively cooperate with tax authorities during audits.
Why Hongda
Check the tax position against your actual records, with one China-based service team.
Serving foreign companies in China since 2007, with client relationships that go back to 2008.
Company setup, banking, tax, payroll and work permits coordinated by one team.
English-language project management with a China-based team in seven locations.
We confirm the scope before work begins and say which decisions rest with authorities or banks.
Client voices
Travis Perkins
David Finch BA ACMA CMIIA CAMA
Director of Group Business Risk & Assurance, Travis Perkins PLC
With Hongda since 2008
Travis Perkins PLC (a leading builders merchant in the UK) has been using Hongda Business Services since 2008 for accounting and professional services. Throughout this time, we have found the team at Hongda to be very helpful and professional in their dealings with us. We look forward to working with the company in the future.
Sound United
Jack Peng
Vice President, Asia Pacific, Sound United
With Hongda since 2013
Sound United (a leading designer and manufacturer of consumer audio products in the US) has been using Hongda Business Services since 2013. Moving one’s operations to China is not a small task, but Hongda’s expert services helped us set up a company and deal with tax issues so we could get on with growing our business in no time at all, and that’s why we continue to use them today.
Tulip Pacific Ltd.
Erik de Waard
Director, Tulip Pacific Ltd.
With Hongda since 2012
Tulip Pacific Ltd. (Business planning and interim financial management services) has been using Hongda Business Services since 2012. Hongda has helped us set up legal entities in China/HK and takes care of our annual company audits. They are the most efficient business service provider I have worked with to-date, and their professional advice has helped me better advise my own clients and provide greater value to my overall business.
Your team
Meet the three chief consultants at Hongda, including founder Angel Ho and co-founder Bobby Lee.
Chief Consultant, CEO
Founder of Hongda in 2007. Holds Chinese Tax Agent, IPA (Australia) and IFA (UK) certificates. Provides one-stop services covering market access, company establishment, financial settlement, financial and tax consultation, and human resources management.
Chief Consultant
Co-founder of Hongda. Many years of corporate legal consultancy and involvement in managing client enterprises. Familiar with tax, personnel and project management work across Guangdong, Hong Kong and Macau. Excellent English communication skills.
Chief Consultant
24 years in enterprise management, business development, and financial and tax compliance. Has provided financial and tax advisory services for hundreds of companies. In-depth learning and practical experience in IFRS (International Financial Reporting Standards), Generally Accepted Auditing Standards and International Taxation.
Foreign-invested enterprises, WFOEs, trading companies, and finance managers should review tax risk when filings, invoices, contracts, or management reports no longer tell the same story.
Hongda can review the company status, filing routine, invoice flow, accounting records, and management concerns before suggesting the next practical compliance steps.
No. Tax risk review works best when bookkeeping records are organized, so the tax position can be checked against invoices, bank activity, and monthly records.
Contact Hongda before missed filings, unusual transactions, or reporting gaps become urgent, especially if the company is growing or changing its business model.
By obtaining “High-Tech Enterprise” certification, companies can benefit from a 15% corporate income tax rate. Additionally, companies should explore local government tax incentives, such as tax reductions or exemptions, which can further reduce tax liability. When applying for tax incentives, it is essential to provide comprehensive supporting documents, such as technical reports and financial audit statements.
Companies should conduct regular internal tax audits to ensure the accuracy of tax filings and financial records, particularly focusing on revenue recognition and expense accounting. All sales and purchase invoices should comply with regulations to avoid the risk of fraudulent invoicing. Additionally, companies should proactively cooperate with tax authorities during audits to prevent penalties for non-cooperation.
Contact our team
Share your plans, structure and timing. We confirm the scope with you before any work starts.
