Implementation of Scope Expansion of Deferred Withholding Tax Policy on Distributed Profits Reinvested by Foreign Investors for Direct Investment

In order to update the relevant implementation regulations,  the SAT has published the Announcement of the SAT (2018) No.53, Announcement of the SAT on Issues Concerning Expanding the Applicable Scope of the Policy of Temporarily Not Levying Withholding Tax on Distributed Profits Used by Overseas Investors for Direct Investments (Announcement 53) to replace the announcement on the Implementation of the Policy of Temporarily Not Levying the Withholding Tax on Distributed Profits Reinvested by Foreign Investors for Direct Investment (Announcement 3). In response to the updated Circular 102, Announcement 53 has also expanded the application scope of the tax deferral policy on the reinvested profit distribution by foreign investors. Announcement 53 shall be effective from January 1, 2018, while Announcement 3 becomes ineffective from January 1, 2018.