One-person limited liability company as stipulated in the Company Law of the PRC refers to a limited liability company with only one natural person shareholder or legal person shareholder. Since there is only one shareholder in a one-person limited liability company, it is easy for the shareholder to abuse the independent status of corporate legal person and shareholder’s limited liability to evade debts. The Company Law of the PRC sets forth special rules in a separate section to regulate one-person limited liability company accordingly. The details are as follows:
Investment Restriction for Natural Person
One natural person is only allowed to establish a one-person limited liability company, which shall not establish any more one-person limited liability company.
No Shareholders Meeting
Since there is only one shareholder in a one-person limited liability company, it has no shareholders meeting. The shareholder can directly exercise its shareholder functions and powers by signing a written form decision. The convening procedures of shareholders' meeting, shareholders' voting procedures and other relating provisions as stipulated in the Company Law of the PRC shall not be applied under this circumstance.
Statutory Audit
A one-person limited liability company shall make a financial report by the end of every fiscal year and have the report audited by an accounting firm.
Joint and Several liability of the Shareholder
If the shareholder of a one-person limited liability company is unable to prove that the property of the one-person limited liability company is independent from its own property, it shall bear joint liabilities for the debts of the company.
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.
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?
In generally, transactions between two independent enterprises include business transactions (sales, labor, financing, etc.) and donations. While transactions between shareholders and enterprises they invest includes business transactions, capital investment, dividend distribution, capital reduction and so on. Strictly speaking, there is not exist donations between shareholders and enterprises they invest, when compared with two independent enterprises.
There are 11 kinds of taxes currently applicable to the enterprises with foreign investment, foreign enterprises and/or foreigners, namely: Value Added Tax, Consumption Tax, Income Tax on Enterprises with Foreign Investment and Foreign Enterprises, Individual Income Tax, Resource Tax, Land Appreciation Tax, Urban Real Estate Tax, Vehicle and Vessel Usage License Plate Tax, Stamp Tax, Deed Tax, and Customs Duties.
With the increasingly frequent international exchanges, more foreigners or returnees from overseas need to drive vehicles in China. For those holding a foreign driving license, it is crucial to understand how to obtain a China driving license. This article will provide a detailed introduction to the specific process and required materials for renewing a driving license from abroad to a China one, helping you complete the renewal procedures smoothly.
