The following question was asked by an attendee at a recent Proformative China M&A, Tax and Structure

Is there a holding requirement before dividends may be pulled from China - even if taxable? (Webinar Attendee Question)
Answers
Before a Chinese company can make dividend distribution to its shareholders, the company should put 10% of its annual profit into a statutory reserve every year until the total amount of the reserve reaches 50% of the registered capital amount. If the registered capital has been paid in full according to the capital contribution schedule, the company can distribute dividend from its retained earnings
Hi Jinghua Liu
I would appreciate some clarity. What is a "registered capital amount"? When is it not paid in full? What is "capital contribution schedule"?
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FP&A