Although a branch has the word company, it is not a real company. Because the branch does not have the qualification of an enterprise legal person, does not have an independent legal status, and does not bear civil liability independently. A subsidiary has the status of a legal person and can bear civil liability independently, which is an important difference between a subsidiary and a branch. There are great differences in tax laws and regulations. Because the branch is not an independent legal person, its profits and losses should be combined with the head office to calculate and pay taxes, while the subsidiary is an independent legal person, and the parent and subsidiary companies should pay taxes separately. The subsidiary can only distribute dividends according to the shares held by shareholders in the after-tax profits.
legal ground
Article 14 of the Company Law