Analysis of Advance Tax Planning for Overseas EPC Project

Key words: 
• overseas EPC contracting /
• advance /
• tax planning

Abstract: With the establishment of "the Belt and Road" Initiative of Chinese government, Chinese contractors are contracting more and more EPC Projects overseas. Because of different laws and tax regulations of different countries and regions, the project experience of Chinese contractors in one country might not be suitable for another. In this article, wrong practices and typical risks of advance tax planning for overseas EPC Project are firstly discussed, in order to avoid those risks. Key points of advance tax planning are then discussed, including making comprehensive investigation of tax regulations of both the country where the project located and China, making reasonable arrangements in EPC contracting, and taking into consideration of the influence of cash flow arrangements to tax compliance, etc. A good advance tax planning is precedent to smooth execution of EPC Project and the fulfillment of profit of Chinese Contractors as well.