- info@kaizencpa.com
- Our Office: USA - Hong Kong - Shenzhen - Shanghai - Beijing - Taiwan - Singapore - Japan - UK
+852 2341 1444(Hong Kong)
Search for anything.
Knowledge
- Home
- Knowledge
- Conditions for High-Tech Enterprise Recognition in China
2025-09-18Conditions for High-Tech Enterprise Recognition in China
The standard corporate income tax rate in China is 25% currently. Ratified high-tech enterprises may enjoy a preferential corporate income tax rate of 15% and receive policy support such as special funds from national and local governments, scientific and technological project funding, and additional deductions for R&D expenses. So what are the conditions to apply for high-tech enterprise recognition?
According to the Measures for the Administration of the Recognition of High and New Technology Enterprise (Guokefahuo [2016] 32) jointly issued by the Ministry of Science and Technology, Ministry of Finance and State Administration of Taxation of the PRC, to apply for high-tech enterprise recognition, the following basic conditions shall be satisfied simultaneously:
-
The enterprise shall have been incorporated for more than one year when applying for ratification.
-
The enterprise acquires the ownership of the intellectual property rights that play a core supporting role in the technologies of its main products (services) by means of independent R&D, transfer, gift, merger and acquisition, etc.
-
The technologies that play a core supporting role in the main products (services) of the enterprise fall within the scope prescribed in the Fields of High and New Technology under the Primary Support of the State.
-
The number of scientific and technological personnel engaged in R&D and related technological innovation activities shall account for not less than 10% of the total number of employees of the enterprise in the current year.
-
The proportion of the total R&D expenses in the total sales revenue of the enterprise in the last three fiscal years (the actual operation period less than three years shall be calculated according to the actual operation period) shall meet the following requirements:
(1) For the enterprise with sales revenue of less than RMB50 million (inclusive) in the last year, the proportion shall not be less than 5%;
(2) For the enterprise with sales revenue ranging from RMB50 million to RMB200 million (inclusive) in the last year, the proportion shall not be less than 4%; and
(3) For the enterprise with sales revenue of more than RMB200 million, the proportion shall not be less than 3%.
The total R&D expenses incurred by the enterprise in China shall account for no less than 60% of its total R&D expenses.
-
The proportion of the income from new and high technology products (services) in the last year to the total income of the enterprise in the same period shall not be less than 60%.
-
The evaluated innovation capability of the enterprise shall meet the corresponding requirements.
- The enterprise is absent from major safety or quality accident or serious environmental violation within one year prior to the application for ratification.
Currently, the Fields of High and New Technology under the Primary Support of the State cover the following eight fields: electronic information, biology and new medicine, aerospace, new materials, high-tech services, new energy and energy conservation, resources and environment, advanced manufacturing and automation.
KAIZEN Group is equipped with experienced and highly qualified professional consultants and is therefore well positioned to provide professional advices and services in respect of the formation and registration of company, application for various business licences and permits, company compliance, tax planning, audit and accounting in China. Please call and talk to our professional consultants for details.
Disclaimer
All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage.
WhatsApp/Line/Wechat: +852 5616 4140
All information in this article is only for the purpose of information sharing, instead of professional suggestion. Kaizen will not assume any responsibility for loss or damage.
WhatsApp/Line/Wechat: +852 5616 4140
Related Posts
China Tax Credits Policy to Foreign Investors' Direct Investment with Distributed Profits
The Ministry of Finance, the State Taxation Administration and the Ministry of Commerce jointly issued the "Announcement on the Tax Credit Policy for Direct Investment by Foreign Investors with Distributed Profits" on 30 June 2025. From 1 January 2025 to 31 December 2028, foreign investors who use the profits distributed by resident enterprises in China for direct reinvestment within China may enjoy tax credits if they meet the conditions.
Profit Repatriation from China FIE
The profits obtained by the foreign investors within the territory of the PRC can be freely remitted out according to the Foreign Investment Law of the PRC. However, foreign invested enterprises (FIE, foreign invested limited liability companies) must meet certain conditions and complete specific procedures when applying to remit out the distributed profits (dividends) to overseas shareholders.
Analysis of Foreign Nationals' First Work Visa to China
With the continuous opening-up of China's cross-border employment market, an increasing number of foreign professionals are choosing to develop their careers in China. First-time applicants often face issues such as conceptual confusion, complex documentation requirements, and tight timelines.
China VAT Provisions on Software Service and Technology Development Service
Nowadays, most of the tax incentives implemented in China require taxpayers to determine by themselves whether they are qualified, declare and enjoy tax incentives and retain relevant materials for future inspection. Under such circumstances, enterprises shall actively prevent their own tax-related risks when enjoying tax preferential policies on the basis of the provisions of tax policies.