With the gradual progress of the Belt and Road Initiative, in order to help Chinese “going global” enterprises and individuals understand the investment environment and relevant tax policies of the Democratic Republic of East Timor, we have compiled the Tax Guide for Chinese Residents’ Investment in East Timor.

The Guide consists of six chapters.

Chapter I presents an economic overview of East Timor.

The second chapter introduces the tax system and main taxes of East Timor, including income tax, payroll tax, oil tax, sales tax, etc.

The third chapter introduces the tax collection and administration system of East Timor, including the establishment and responsibilities of the tax system administration, as well as the tax collection and administration of resident taxpayers and non-resident taxpayers.

The fourth chapter introduces the relevant contents of special tax adjustment, including related party transactions, contemporaneous data, transfer pricing investigation, advance pricing arrangement, controlled foreign enterprises, cost sharing agreement management, capital weakening, etc.

The fifth chapter introduces the relevant content of tax dispute resolution in East Timor.

The sixth chapter introduces the possible tax risks of investment in East Timor, including tax declaration risks, investigation and identification risks, tax treaty treatment risks, information reporting risks, etc.