Page 41 - Doing Business in China

TAXATION

Deadline for submission
Contemporaneous documentation shall be provided within 30 days of the tax authority’s request�

Content of master file
Bulletin 42 states that the master file must disclose key global business information of the whole group to which
the Chinese enterprise belongs, including the group’s organisational structure, the group’s business description
(including inter-company transactions), intangibles, financing activities, as well as its financial and tax status�

Organisational structure
A chart illustrating the group’s global organisational structure, shareholding structure and geographical location
of all its business entities�

Group’s business description
A description of the group’s business, including information on their supply chain and geographical location of
major markets, important intragroup service arrangements, value-creating contributions from each entity,
functional changes due to business restructuring, risks or assets within the group, and reorganisations during the
fiscal year�

Intangibles
▪ A description of overall strategies in relation to the development and utilisation of intangibles, determination
of the ownership of intangibles, the group’s transfer pricing policies relating to R&D and intangibles, as well as
any transfer of interests of intangibles among related parties during the fiscal year�
▪ A list of the group’s intangibles that have a significant impact on its transfer pricing policy, the ownership of
such intangibles, and significant intangibles-related agreements between entities in the group�

Financing activities
A description of intragroup financing arrangements, the group’s key financing arrangements with unrelated
parties, entities in the group that provide central financing for the group, as well as the group’s transfer pricing
policies relating to financing arrangements between related parties�

Financial and tax status

▪ The group’s annual consolidated financial statements for the latest fiscal year�
▪ A list of the group’s existing unilateral APAs, bilateral APAs and other tax rulings relating to the allocation of
income among countries, together with brief descriptions, names and locations of entities in the group that
will prepare and submit the Country-by-Country report�

Contents of local file
Bulletin 42 states that the local
file should provide an overview
of the Chinese enterprise,
detailed information of its
related party relationships and
transactions, information on
the selection and application
of transfer pricing methods, as
well as a comparability analysis��

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