A company in China lets you trade, invoice and get paid locally in your own name, and it can employ you so you can live here. For many traders and service businesses it also means more control over suppliers and lower costs than working through agents.
It also brings ongoing duties: monthly tax filings, annual reports and real business activity. It suits people with a steady reason to operate in China, not everyone.
Six practical benefits
Sign contracts with Chinese factories and customers in your company’s name, instead of relying on a buying agent or a local partner.
Chinese customers usually need a fapiao (official invoice). Only a registered company can issue one.
Open a company bank account to receive payments in China and, with the right setup, from overseas.
Since December 2022, a registered company no longer needs a separate foreign trade operator filing. Customs registration is still needed before you declare goods.
Your company can apply to employ you, which can lead to a work permit and residence permit if you meet the conditions.
Until the end of 2027, qualifying small, low-profit companies pay an effective 5% corporate income tax on taxable income up to RMB 3 million.
Who it suits, and who it does not
| Usually a good fit | Often not worth it yet |
|---|---|
| Traders buying regularly from Chinese factories, for example in Yiwu or Guangzhou | One-off or occasional buyers who can use a trusted agent |
| Service businesses with Chinese clients who need invoices | Businesses with no customers or suppliers in China yet |
| Owners who want to live and work in China | Anyone setting up a company only to obtain a visa |
The commitments that come with it
- Monthly or quarterly tax filings, even when there is no revenue
- An annual report to the market regulator, due by 30 June each year
- A registered address that meets local rules, and a bank account kept in use
- Bookkeeping, usually through an accounting agent
A simple company with an address-only arrangement and basic accounting typically costs about USD 900–1,400 in its first year. See the full cost breakdown.
Related questions
Can a foreigner own 100% of a company in China?
Yes, in most ordinary sectors. This is usually called a wholly foreign-owned enterprise (WFOE). Some industries are restricted or closed to foreign investment. Read about ownership.
Do I need to live in China to run the company?
No. Many owners run their company from abroad and visit on business visas. You need someone reliable for local tasks, and the legal representative carries legal responsibilities.
Which city should I choose?
Start from where your suppliers, customers and staff are. Then check local rules on addresses and work permits, since these differ between cities. See the cities we cover.
How long does it take to set up?
The business licence is often issued within a few weeks once documents are ready. Bank account, tax and customs registration take longer. See the steps.
This guide explains general practice based on Scott’s experience. Requirements depend on your city, nationality and circumstances, and the authorities make the final decision.