Legal basis: Measures for the Administration of Individual Income Tax on Equity Transfer (Trial)
Article 3 The term "equity transfer" as mentioned in these Measures refers to the transfer of equity by individuals to other individuals or legal persons, including the following situations:
(a) sale of equity;
(2) The company repurchases shares;
(3) When the issuer issues new shares to the public for the first time, the shareholders of the invested enterprise will sell their shares to investors by way of public offering;
(4) The equity is forcibly transferred by judicial or administrative organs;
(5) Foreign investment or other non-monetary equity transactions;
(6) Paying off debts with equity;
(seven) other acts of equity transfer.
Eleventh in any of the following circumstances, the competent tax authorities can verify the income from equity transfer:
(1) The declared income from equity transfer is obviously low without justifiable reasons;
(2) Failing to file tax returns within the prescribed time limit, or failing to file tax returns within the time limit ordered by the tax authorities;
(3) The transferor is unable to provide or refuses to provide relevant information on the income from equity transfer;
(4) Other circumstances in which the income from equity transfer should be verified.