Definition of Branch and Subsidiary
关于分公司和子公司的定义：
Branch分公司：
According to Article 39 of the regulations of the <PRC on the Administration of Registration>, "a BRANCH refers to an institution set up by a company outside its domicile to engage in business activities, and does NOT have the status of a LEGAL PERSON."
按照《中华人民共和国登记管理条例》第三十九条规定：“分公司是指公司在其住所以外设立的从事经营活动的机构，且不具有法人资格。”
Subsidiary子公司：
A subsidiary is a company in which a certain amount of shares are held and controlled by the parent company. Generally speaking, if the holding proportion of the parent company reaches more than 50%, it can be called "absolute holding"; If the holding proportion of the parent company is the highest among all shareholders, but it does not exceed 50%, it can be called "relative holding".
子公司，即一定数额的股份被母公司持有并加以控制的公司。一般而言，如果母公司控股比例达到50％以上，可以称为"绝对控股"；如果母公司控股比例在所有股东中最高，但又不超过50％，可以称为“相对控股”。
The Difference of a Branch and a Subsidiary:
公司法关于子公司和分公司的区别：
1. A Branch has no legal person status. A Subsidiary has independent legal person status.
2. A Branch does not have an independent name, while a subsidiary has its own independent name.
3. A Branch is an extension of the parent company, and its business activities are completely subject to the parent company. A Subsidiary is legally independent from the parent company, and has an independent and complete company management system, which has greater independence and certain flexibility in operation.
4. The property and funds of a Branch company are entirely owned by the parent company, and a Subsidiary has its own independent property.
5. The civil liability of a branch shall be borne by the parent company, and a subsidiary shall independently bear its own civil liability
1.分公司不具法人资格。子公司具有独立的法人地位。
2.分公司不具有独立的名称，子公司有自己独立的名称。
3.分公司是原公司的分支，其经营活动完全受制于原公司。子公司在法律上独立于母公司，并拥有独立而完整的公司管理体系，在经营方面有较大的独立性和一定的灵活性。
4.分公司的财产资金完全属于母公司，子公司有属于自己的独立财产。
5.分公司的民事责任由母公司承担，子公司依法独立承担民事责任。
Therefore, tax related differences:
因此，税务相关的不同：
l Different Taxpayer Identities纳税人身份不同：
n A Subsidiary is an independent taxpayer,
n A Branch may be an independent taxpayer (such as Value-Added Tax), and may not be one (such as corporate income tax)
子公司是独立的纳税人，
分公司可能是独立的纳税人（如增值税），有可能不适独立的纳税人（如企业所得税）
l Independent accounting: 是否独立核算：
n A Subsidiary must be independent,
n A branch is not necessarily
子公司肯定是独立可算，
分公司不一定是独立核算
Then the Tax Planning, mainly regards what kind of Tax
如何涉税安排，关键看需要安排什么税种
l VAT Planning: both Branch and Subsidiary can be realized
增值税安排：子公司和分公司都可以实现
l For example, subsidiaries and branches can arrange enterprises to enjoy some preferential tax policies for general taxpayers + small-scale taxpayers. Because branches can become VAT taxpayers alone, for example, subsidiaries are small-scale taxpayers, and branches can be general taxpayers; The reverse is also possible.
例如：像安排企业为一般纳税人＋小规模纳税人享受一些税收优惠政策的架构，子公司和分公司都可以。因为分公司可以单独成为增值税纳税人，比如子公司是小规模纳税人，分公司可以是一般纳税人；反过来也可以
Reminder: for taxpayers who meet specific conditions, after approval, the VAT can be collected and paid by the headquarter; and the branches pay in advance according to the approved proportion.
提醒：对于符合特定条件的纳税人，经过审批后，增值税可以由总机构汇总缴纳，分支机构按审批后的比例预缴。
Enterprise Income Tax arrangement: separate on specific conditions
企业所得税安排：分开具体情况
l For example, the preferential policies for high-tech enterprises and small low profit enterprises are enjoyed according to the caliber of the head office and branches: parent and subsidiary companies can enjoy them respectively.
例如，比如高新技术企业优惠，小型微利企业政策，就是按照总分公司口径享受：母子公司可以分别享受。
l Another example is the preferential policies for the development of the West in Hainan Free Trade Zone, which can be enjoyed by branches and head offices, as well as parent and subsidiary companies.
再如海南自贸区，西部发开发优惠政策，分公司和总公司可以分别享受，母子公司也可以分别享受
Individual Income Tax arrangement个人所得税安排
l A Branch has made tax registration and can withhold individual income tax separately;
l A Subsidiary must withhold individual income tax separately
分公司做了税务登记，可以单独扣缴个人所得税；
子公司肯定单独扣缴个人所得税
l Article 8 of the <Individual Income Tax Law> stipulates that "the unit or individual that pays the income shall be the withholding agent for individual income tax". Therefore, the individual income tax payment places of branches will be different.
《个人所得税法》第八条规定：“个人所得税以支付所得的单位或者个人为扣缴义务人”。因此，分支机构的个人所得税缴纳地点会不相同。
l In practice, in order to avoid being verified and levied personal income tax by the tax authorities operating in different places, part-time enterprises can arrange the full withholding detailed declaration of all employees of the branch company, and of course, the full withholding detailed declaration of all employees of the head office and branch company respectively.
实务中，兼职企业为避免被在异地工程作业的税务机关核定征收个人所得税，可以安排分公司全员全额扣缴明细申报，当然也可以总分公司分别全员全额扣缴明细申报。
Property Tax Arrangement房产税安排
The obligor of the property tax is the owner of the property right. The collection authority is the tax authority of the place where the house is located in the area. The division of labor is applicable to the property location of the head office. Oh story, declare and pay the property tax in the place where the house is located.
房产税的那谁义务人是产权素有人，征收机关区内房屋所在地税务机关，分工是适用总公司的房产所在风哦故事在房产所在地申报缴纳房产税。
In the end, the choice to make, to set up a branch or a subsidiary:
哪些情况下该选择分公司还是子公司：
At the initial stage, most of the subordinate enterprises will incur losses. If a branch company is established at this time, the income tax can be reduced by offsetting the profits of the original company with the original company in the "consolidated statements", but if setting up a subsidiary, it cannot enjoy this benefit.
在初期下属企业大多数都会产生亏损，此时建立的是分公司的话和原公司一起“合并报表”冲减原公司利润就可减少缴纳所得税，但如果办理子公司就不能享受这个好处。
If the enterprise is very confident and can turn losses into profits or make direct profits soon after its establishment, then setting up a subsidiary is better than branch. As the subsidiary can enjoy the convenience of independent operation, as well as the benefit of deferred tax on undistributed profits.
如若企业自身比较自信，开设不久就可以扭亏为盈或者直接盈利，那么设立子公司就优于建立分公司。因为子公司可以得到独立经营的便利还可以享受未分配利润递延纳税的好处。
When the parent company enjoys preferential tax policies but the branch does not, it is still better to choose the branch company, as the company can also enjoy them. If the branch also has local tax incentives, its registration can be altered to be a subsidiary after the branch makes profits, which can make the tax saving effect greater.
当总公司享受税收优惠政策而分公司不享受时，那么最好也还是选择分公司，这样分公司也能享受。如果分公司也有当地的税收优惠，则可以在分公司盈利后变更注册为子公司，这样可以使节税效果更大化。
REMINDERS:
l A Branch cannot enjoy the preferential policies as a small low profit enterprise separately. For branches, they should be incorporated into the parent company to collect and pay enterprise income tax. If the summarized data meet the conditions for small low profit enterprises, they can enjoy the preferential policies for small low profit enterprises as a whole.
分支机构不单独享受小型微利企业优惠政策，对于分支机构，应当并入总机构汇总缴纳企业所得税，汇总后的数据如果符合小型微利企业的条件，可以整体享受小型微利企业的优惠政策。
l If the branch does not integrate into the parent company for consolidated tax payment, but chooses to pay tax separately according to independent taxpayers, it cannot enjoy the preferential policies of small low profit enterprises, and can only make tax declaration at the basic tax rate of 25%.
如果分支机构不并入总机构汇总纳税，而选择按照独立纳税人单独纳税，不能享受小型微利企业的优惠政策，只能按照25%的基本税率进行纳税申报。
l If the parent company calculates itself and all branches together, such as the combined annual taxable income, the number of employees, and the total asset indicators meet the regulations, it can enjoy the preferential income tax policies for small low profit enterprises. Even if the indicators of a single branch meet the requirements, it cannot enjoy the discount.
假如总公司将自身和所有分公司合在一起计算，如合并计算的年度应纳税所得额，从业人数，资产总额指标符合规定，就可享受小型微利企业所得税优惠政策。单独一个分公司即使指标符合要求，也不能享受该优惠。
l The branch company does not need to calculate the tax payable by itself, nor does it need to adjust the tax matters when filling in the annual tax return during the final settlement process. It only needs to make up tax or refund tax locally according to the actually paid tax calculated and distributed by the head office.
分公司并不需要自行计算应纳税额，也不需要在汇算清缴过程中填报年度纳税申报表时进行纳税事项调整等，只需要根据总公司计算分配的实缴税款，就地补税或退税即可。
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