What You Must Know If You Pay Tax in China!

In this article, we will explain: How do foreigners pay taxes in China? Based on what standard?  How much should you pay? You can also review our article: Expats in China: How Do You Pay Taxes?

If you still have any questions, don't hesitate to drop them in the comment area!

Please recheck your salary on your labor contract and payroll commitment.

1

With A Payroll Commitment

a sample from our clients.

Payroll commitment is required in applying for the work permits below:

• Type A work permit;

• Type B work permit (point-based system);

• Type B work permit (four times as much as average salary);

• Type C work permit (for newly graduates).

Source: Exit and Entry Administration Law of the PRC

Notice: You must make sure that the salary claimed on your labor contract（劳动合同） is the same as the salary claimed on your payroll commitment（薪资承诺书）. If you ever need to extend your work visa, you must pay tax based on your committed salary. 

2

Without A Payroll Commitment

If you don't hold a payroll commitment when you apply for a work visa, you may need to provide your labor contract or your application form, where your salary and tax payment are proved.

If you need assistance with Tax Payment, please feel free to contact VisaOfChina team!

Social Insurance Reduction in Salary

In addition to taxes and fees, there are 5 types of social insurances and 1 housing fund for salary（五险一金） obtained in China. Requirements vary among cities. The fees shall be paid by the employer and employee together.

Before leaving China, you can apply for a refund of these social insurance contributions in written form.

For more details, you can follow us for the new article!

Income and Tax

1

Do You Need to Pay Tax

Please pay attention to whether you meet taxation regulations, and remind your company to pay personal income tax on your behalf. 

If you meet one of the conditions below, you can be considered as a resident in China:

• You have a residency in China;

• You live over 183 days in China per year. 

Source: State Taxation Administration of the People's Republic of China

《国家税务总局关于在中国境内无住所的个人取得工资薪金所得纳税义务问题的通知》（国税发〔1994〕148号）

China Daily

When you meet one of these, you need to pay tax based on global salary. If not, you only need to pay tax based on your Chinese salary. 

Source: State Taxation Administration of the People's Republic of China

2

About Tax Payment

The threshold of personal income tax is 5000 yuan. So, if you earn more than 5000 a month, you need to pay tax. 

You can scan the QR code below to check the 2021 Announcement on Income Tax Clearance.

Note: The information scanned out is in Chinese

Source: State Taxation Administration of the People's Republic of China

3

Double Taxation?

If a foreigner is a resident in both countries, do they need to pay taxes twice?

They will need to declare in both countries. But if they have already paid in one country, they can apply for a tax return from the other country.

China has signed a bilateral agreement on tax payment with 110 countries and regions, which avoids tax investments twice.

Source: State Taxation Administration of the People's Republic of China

Foreigners can print their personal tax certificates online

Foreigners who have had their identity authenticated (bank card required) can log on to the e-Tax Bureau and print the tax clearance certificate in the module:

1. "I want to check"
   

2. "Certificate information check" 
   

3. "Issuing tax clearance certificate".

4. Print the certificate.

Notice:

The additional income of an individual can also be invoiced in the individual's name and claimed for tax purposes.

The End

If you have any questions about China visa applications(work visa, PU letter, company registration and more), please contact our visa consultant Anna (WeChat ID: AnyHelper_Anna).

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