A realistic lean WFOE budget for 2026: setup RMB 40-80k, monthly compliance RMB 6-12k, plus the capital plan under the 5-year paid-up rule. Budget discipline at entry prevents the death-spiral of underfunded entities.
Setup (one-off): registration service RMB 15-30k; chops/bank/notary RMB 3-5k; office deposit varies by city. Monthly steady-state: bookkeeping + VAT/CIT filings RMB 3-6k (small trading), payroll + social insurance handling RMB 1-2k per head-batch, office + utilities, and annual audit RMB 8-20k. The invisible line items: registered capital must be paid within 5 years (2024 Company Law) — size it to your real runway, not vanity; social insurance is 35-40% on top of gross salary for the employer portion; and dormancy is not free — nil filings still cost and penalties compound. Undersized entities that stop paying compliance eventually face forced deregistration with shareholder liability for unpaid amounts. The correct model: capital covering 12 months of total costs, compliance budgeted monthly, and a quarterly review of entity necessity — close what you do not use.
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Zhonghui Consulting — cross-border compliance engagements, fixed fees, English-speaking delivery team.
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