How to Declare Export Agent Commissions Compliantly? The Latest 2025 Tax Treatment Guide

1. What type of expense does the agency commission fall under?

According to the latest 2025 "Cross-Border Service Value-Added Tax Management Measures," the legal nature of agency commissions must be clearly defined:

• Commission for agency relationship：The trustee shall not bear the transaction risks and shall pay 6% VAT on the service fee.
• Trade intermediary commission: Participating in transaction pricing and bearing risks may be recognized as additional charges in goods trade.
• Payment of commission abroad: It is necessary to determine whether it constitutes a permanent establishment, involving the withholding and remittance of corporate income tax for non-resident enterprises.

2. What materials are required for the declaration of agency commissions?

In 2025, tax authorities will continue to strengthen the verification of the authenticity of commission payments. It is recommended that enterprises prepare:

• Basic documents
  • The filed agency agreement (specifying the method of commission calculation)
  • Bank Payment Slip and SWIFT Message
• Supporting documents
  • Proof of Actual Service by Agent (emails, logistics documents, etc.)
  • Commission Calculation Details (Matching)Export ClearanceTracking Number)
• Tax documents
  • Withholding and remittance of VAT/income tax payment certificate
  • Cross-border Service Filing Form (if applicable)

3. What are the tax risks associated with cross-border payment commissions?

According to the joint inspection cases by the General Administration of Customs and the State Taxation Administration in 2025, special attention should be paid to:

• Pricing of related party transactions: The payment of commissions to related parties must comply with the arm's length principle.
• Determination of Permanent Establishment：Foreign agents conducting activities in China for more than 183 days are required to complete tax registration.
• Anti-tax avoidance investigation: An abnormal commission ratio (exceeding 5%) may trigger special tax adjustments.
• Application of Tax Treaties: A tax residency certificate from the overseas agent is required.

IV. What are the new changes in commission tax treatment for 2025?

In conjunction with the "Announcement on Improving Tax Administration for Cross-Border Services" issued in March 2025:

• Electronic filing: Cross-border payment commissions must complete tax filing within 15 days from the date of payment.
• New Invoice Regulations: Overseas invoices must be accompanied by a notarized translation (effective from July 1, 2025).
• Deduction limit: Commission expenses for which taxes were not withheld as required are not deductible before tax.
• Data matching: Customs export data and tax declaration data will be automatically cross-checked.

V. Quick Answers to Common Questions

• Q: What is considered a reasonable commission rate?

  A: For general trade, the rate should not exceed 5%; for bulk commodities, it should not exceed 3%. A reasonable explanation must be provided based on industry characteristics.

• Q: Can I pay overseas commissions in RMB?

  A: Yes, but it must be processed through the cross-border RMB settlement system, and tax filing is still required.

• Q: What is the withholding income tax rate?

  A: If no tax treaty is signed, a 10% withholding tax applies; preferential treaty rates require filing for approval before application.

• Q: What are the consequences of reporting errors?

  A: May face a late fee of 0.5-3 times, affecting the AEO certification level with customs.