INCOME TAX FOR FOREIGNERS IN CHINA

Click " ESLTeachersGuidance" above ↑↑↑ to follow us.

Expats and halfpats in China can refer to the following table and work out the amount of taxes you’ll be deducted monthly.

Tax Rate Chart (translated from this article from Shanghai Tax Bureau)

Taxable Income = ( Total Income – Initial Deduction* – Tax Deductible Allowance** )

Tax Payable = ( Taxable Income x Tax Rate ) – Deduction

* Initial deduction is RMB 3,500 for PRC residents and 4,800 for foreigners. (taken from this other article from Shanghai Tax Bureau)

** Tax Deductible Allowance includes rental, food and travel expenses, etc. as determined by your company’s Finance/HR department. You will need to get fapiao (发票) (official invoices) for these figures to qualify as your Tax Deductible Allowance.

Tax Examples

Example 1: Gross Salary of 10K RMB/month

• Gross Salary = 10,000

• Taxable Income = 10,000 – 4,800 = 5,200

• Tax Rate = 20%

• Deduction = 555

• Tax = 5,200 * .2 –555 = 485 RMB

Example 2: Gross Salary of 10K RMB/month, Tax Deductible Allowance of 2,000 RMB/month

• Gross Salary = 10,000

• Tax Deductible Allowance = 2,000

• Taxable Income = 10,000 – 4,800 – 2,000 = 3,200

• Tax Rate = 10%

• Deduction = 105

• Tax = 3,200 * .1 –105 = 215 RMB

Example 3: Gross Salary of 30K RMB/month

• Gross Salary = 30,000

• Taxable Income = 30,000 – 4,800 = 25,200

• Tax Rate = 25%

• Deduction = 1,005

• Tax = 25,200 * .25 –1,005 = 5,295 RMB

Example 4: Gross Salary of 30K RMB/month, Tax Deductible Allowance of 15K

• Salary = 30,000

• Tax Reimbursable Expenses = 15,000

• Taxable Income = 30,000 – 4,800 –15,000 = 10,200

• Tax Rate = 25%

• Deduction = 1,005

• Tax = 10,200 * .25 – 1,005 = 1,545 RMB

Naturally, the more your tax deductible allowance, the lower your taxable income and the lesser taxes you pay. So be sure you work out your sums thoroughly before negotiating your next raise or paycheck!

Editor's Pick : 

Please join our groups  

WechatName: ESLTeachersGuidance

press or scan the QR CODE above to follow us!

Teach English in China and be part of one of the fastest changing countries in the world. We offer a wide variety of high paying English teaching jobs in different major cities in China.