January — The Year Starts with VAT and IIT
For a new WFOE tax filing China cycle, January is deceptively calm. But the deadlines are already rolling.
Deadline: January 20 (adjusted from the standard 15th due to New Year holidays)
By January 20, every WFOE must file:
- VAT return for the December period
- IIT monthly withholding for December salaries
- Social insurance contributions (due by the 10th of each month)
This is also the month when social insurance base verification begins — the annual adjustment of contribution ceilings and floors that takes effect in the new fiscal year.
Many first-time WFOE owners are surprised to learn that a company with zero revenue must still submit a zero-declaration VAT return. One foreign entrepreneur in Guangzhou told their accountant they had "nothing to file." They were wrong. Three consecutive missed zero filings trigger automatic tax abnormal status, which blocks fapiao issuance and can freeze bank accounts.
February — Audit Season Begins
Deadline: February 24 (adjusted for Chinese New Year)
February's filing covers January's VAT and IIT. The bigger development: audit season begins. Most WFOEs appoint a local CPA firm in February to audit the prior year's financials.
The audit report is not optional for most WFOEs. It serves as the prerequisite document for the annual CIT reconciliation and for remitting profits to the overseas parent company. Without a signed audit report, the tax bureau will not accept the annual CIT filing, and bank branches will block profit repatriation.
One WFOE owner on Reddit learned this the hard way: "I thought the audit was something we could skip until we needed it. But when we tried to send our first dividend back to the US, the bank demanded a tax clearance certificate and audited statements. We were stuck for three months."
March — IIT Reconciliation Opens
Deadline: March 16 (standard 15th falls on weekend)
VAT and IIT for February are due March 16. But March 1 is the real milestone: the IIT annual reconciliation window opens and runs through June 30.
Every resident taxpayer — including foreign employees who have spent 183 days or more in China — must use the Individual Income Tax (个人所得税) app to reconcile their annual comprehensive income. The app automatically calculates whether the employee overpaid or underpaid through monthly withholding.
Foreign employees should note they can choose between two deduction regimes: the special additional deductions available to Chinese taxpayers (children's education, elderly care, housing rent, etc.) or the expat-specific tax-exempt subsidies (免税补贴) for housing, language training, and children's education. You cannot use both.
April — First Quarterly CIT Payment
Deadline: April 15 (Q1 CIT pre-payment)
Deadline: April 20 (VAT and IIT for March)
April is the first quarterly CIT deadline of the year. Every WFOE must estimate its first-quarter taxable income and pay the quarterly CIT pre-payment by April 15.
The formula: Estimated annual taxable income × 25% × 25% (for the quarter). Most small WFOEs that qualify as small thin-profit enterprises (annual taxable income under 3 million RMB, fewer than 300 employees, total assets under 50 million RMB) pay at an effective rate of 5%.
April is also the target month for completing the annual audit. Many CPA firms push to close audits by April 30 so the audit report is ready for the May 31 CIT annual reconciliation deadline.
May — The Biggest Deadline of the Year
Deadline: May 22 (VAT and IIT for April)
Deadline: May 31 — CIT Annual Reconciliation
May 31 is the single most important date in the China tax filing calendar. By this day, every WFOE must file its corporate income tax annual reconciliation — the year-end settlement that reconciles quarterly pre-payments against actual annual tax liability.
The annual reconciliation requires:
- The annual CIT return (Form A100000)
- Related-party transaction disclosure forms
- The audit report
- Any tax adjustment schedules (disallowed expenses, depreciation differences, etc.)
"May 31 is circled in red on every finance team's calendar," says one Shanghai-based accountant. "If you miss it, the 0.05% daily late penalty starts ticking. And the tax bureau doesn't forget."
For WFOEs with related-party transactions exceeding 200 million RMB, transfer pricing documentation must be prepared and ready for potential inspection by the tax authorities.
June — FAR and IIT Close
Deadline: June 15 (VAT and IIT for May)
Deadline: June 30 — IIT Reconciliation Closes
Deadline: June 30 — Foreign Investment Annual Report (FAR)
Two critical deadlines converge on June 30.
First, the IIT annual reconciliation closes. Employees who haven't filed their annual individual income tax return through the tax app face potential penalties and blocked work permit renewals. The tax authorities have automated the data matching process: reported salary in the IIT system must match social insurance contribution bases.
Second, every WFOE must submit the Foreign Investment Annual Report (FAR) through the joint reporting system by June 30. This report covers the company's basic information, shareholder details, investment holdings, and operating data. Missing this deadline puts the company on the "abnormal operations" list, which blocks any subsequent changes to the business license.
July — Q2 CIT Pre-payment
Deadline: July 15 — Q2 CIT pre-payment
Deadline: July 15 — VAT and IIT for June
The second quarter CIT pre-payment is due July 15. By this point, the company has a better picture of its year-to-date profitability and can adjust its quarterly payment accordingly.
The "six taxes and two fees" (六税两费) half-price reduction continues for small-scale taxpayers and small thin-profit enterprises: resource tax, city maintenance tax, property tax, urban land use tax, stamp duty, farmland occupation tax, plus education surcharges — all at 50% of the standard rate through 2027.
August — Mid-Year Check
Deadline: August 17 (adjusted from 15th)
A relatively quiet month — just the regular VAT and IIT filings for July. August is a good time for WFOE owners to review their year-to-date tax position and plan for potential tax optimization measures before year-end.
Foreign entrepreneurs running consulting or service WFOEs should verify that their small-scale taxpayer VAT status still applies. The annual revenue threshold is 5 million RMB. Once cumulative 12-month revenue exceeds this threshold, the company must register as a general VAT taxpayer with no opt-out option — a change that became mandatory under the 2026 VAT law amendments.
September — Transfer Pricing Preparation
Deadline: September 15 (VAT and IIT for August)
September's quiet filings mask a busy season for tax professionals. This is when transfer pricing documentation should be prepared. While the related-party transaction disclosure is filed with the CIT annual reconciliation by May 31, the supporting contemporaneous documentation must be ready if the tax bureau requests it.
For WFOEs that operate as contract manufacturing or service-delivery entities for overseas parent companies, transfer pricing documentation is not optional. "A foreign-invested company without transfer pricing files during a tax inspection is essentially writing the tax bureau a blank check," one tax advisor notes.
October — Q3 CIT Pre-payment
Deadline: October 15 — Q3 CIT pre-payment
Deadline: October 26 (adjusted for National Day holiday)
The third quarter CIT pre-payment is due October 15. October also brings the adjusted VAT and IIT deadline of October 26 due to the National Day Golden Week holiday period.
By this point, the annual tax picture is clear enough for most WFOEs to forecast their full-year liability and decide whether accelerated depreciation or other year-end tax planning strategies make sense.
November — Year-End Planning
Deadline: November 16 (adjusted from 15th)
Regular VAT and IIT filings continue. November is when experienced finance teams start year-end tax planning in earnest. Strategies include:
- Reviewing accounts receivable for bad-debt write-offs
- Accelerating deductible expenses into the current year
- Evaluating whether to declare dividends before year-end
- Checking compliance with related-party transaction limits
December — Closing Out the Year
Deadline: December 15 (VAT and IIT for November)
December 15 is the last regular filing deadline of the year. The December period's VAT and IIT returns are filed in January of the following year, creating a seamless transition into the next tax cycle.
Year-end closing procedures include inventory counts, bank reconciliation, and preparation for the annual audit. The December VAT return (filed in January) is typically the most complex, reflecting the full year's adjustments.
What Happens When You Miss a Deadline
The penalty structure for late filing in China is unambiguous:
- Daily surcharge: 0.05% per day on the overdue tax amount
- Fines: 50% to 500% of the underpaid tax
- Credit impact: Tax credit rating downgrade affects fapiao quotas, customs clearance, and government procurement eligibility
- Operational freeze: Three consecutive missed filings trigger "tax abnormal" status, which blocks the company from issuing fapiao, changing business registration, or canceling the company
One small-scale WFOE owner found this out when their accountant forgot to file the quarterly CIT. The tax bureau's automated system flagged the missed filing within days. The company couldn't issue fapiao to clients for two weeks while the abnormal status was resolved.
The Monthly Compliance Burden
A small WFOE with one employee faces the same filing calendar as a multinational with hundreds. The difference is bandwidth — the small company owner is often the accountant, the HR manager, and the business developer simultaneously.
The complete compliance calendar includes:
- Monthly: VAT return (or quarterly if small-scale), IIT withholding, social insurance, housing fund
- Quarterly: CIT pre-payment, property tax (some cities)
- Annual: CIT reconciliation (May 31), IIT reconciliation (March 1–June 30), FAR (June 30), audit report, stamp duty reconciliation
Many new WFOE owners retain a local accounting firm to manage the monthly filings. As one foreign entrepreneur put it on Facebook: "Find an accountant who speaks your language. You'll pay a few hundred RMB a month and you'll never miss a deadline again."
The CNBusinessHub team helps foreign entrepreneurs navigate the full WFOE tax lifecycle — from company registration through monthly compliance and annual reconciliation. With a dedicated tax and accounting team averaging over ten years of experience, we ensure your China tax obligations are met on time, every time.
Disclaimer
This article is provided by CNBusinessHub team for informational and educational purposes only. It does not constitute investment, business, or legal advice. Readers should independently assess the applicability of the information and consult qualified professionals before making any business decisions. The data and sources cited are from public channels; while we strive for accuracy, we cannot guarantee completeness or timeliness. Policies and regulations may change — please verify the latest information before acting.
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Last Updated: 2026
