Once you obtain a business license, you must file tax returns on schedule — even if you have no income, you still need to submit a return with all zeros.

12. Once you obtain a business license, you must file tax returns on schedule — even if you have no income, you still need to submit a return with all zeros.

Cost: There’s no direct cost involved. You can file electronically via the tax service portal monthly or quarterly in just a few minutes. Hiring an accountant, however, adds extra expense. If you do hire someone, you must also register for social insurance within 30 days of business establishment. The real challenge is remembering to file on time even during months with no business activity.

In plain terms: After getting a business license, you’re required to file tax returns regularly. Even if you earn nothing, you must still file a return — just fill in all zeros. Failing to do so risks fines up to 2,000 yuan; more serious violations can lead to penalties between 2,000 and 10,000 yuan. If you skip returns for all tax types across three consecutive months, the system automatically labels you as a “non-compliant taxpayer,” and you lose the ability to issue invoices.

Benefit: The law clearly states that “taxpayers with no tax liability during a period must still file a tax return as required.” In other words, even when you owe nothing, filing remains mandatory. Non-compliance brings penalties: tax authorities can order corrections and impose fines up to 2,000 yuan; repeat or severe violations may exceed 10,000 yuan. Any unpaid taxes plus daily late fees at 0.05% must also be settled. Furthermore, persistent non-filing leads to automatic classification as a non-compliant taxpayer, blocking invoice issuance until corrected and penalties paid.

Evidence grade: A

Sources: State Council of China (2002). Implementation Rules of the Tax Collection and Administration Law (State Council of China Order No. 362, Article 32, Article 75). <https://fgk.chinatax.gov.cn/zcfgk/c100010/c5195082/content.html>; National People’s Congress Standing Committee (2015). Tax Collection and Administration Law (2015) (Revised in 2019, Articles 25, 32, 62, and 64). <https://fgk.chinatax.gov.cn/zcfgk/c100009/c5195081/content.html>; State Taxation Administration of China (2019). Announcement on Certain Matters on Tax Collection and Administration (State Taxation Administration of China Announcement No. 48 of 2019, Article 3). <https://fgk.chinatax.gov.cn/zcfgk/c100012/c5195194/content.html>; Standing Committee of the National People's Congress (2018). Personal Income Tax Law (Amended in 2018, Article 12). <https://fgk.chinatax.gov.cn/zcfgk/c100009/c5193028/content.html>; National People's Congress Standing Committee (2018). Social Insurance Law (Amended in 2018, Article 57). <http://www.npc.gov.cn/zgrdw/npc/xinwen/2019-01/07/content_2070267.htm>

Notes: With the “multi-certificates integration” policy, a separate tax registration isn’t needed. Use your business license’s unified social credit code to log into the electronic tax portal and specify applicable taxes. Individual businesses and sole proprietorships pay individual income tax on business earnings. Payments are first due within 15 days after month or quarter-end, followed by an annual settlement by March 31 of the following year to adjust any over- or under-payments. Even without any revenue, zero returns must still be filed. Three consecutive months of non-filing results in automatic classification as a non-compliant taxpayer, halting invoice use; cancellation procedures then become far more complicated — see Section 12.23 for details on orderly business closure.