On 1 July 2015, China's State Administration of Taxation issued Public Notice (2015) 47, which amends and clarifies the withholding tax rules for interest income received by foreign branches of Chinese banks. The Notice applies from 19 July 2015.
The main change is that interest paid by a domestic Chinese entity to a foreign branch will no longer be subject to withholding tax. The change is made in order to avoid issues of double taxation that arise because Chinese banks and their foreign br…