| Monthly Taxable Income (CNY) |
Tax Rate |
| 0 to 1,500 |
0% |
| 1,500 to 4,500 |
10% |
| 4,500 to 9,000 |
20% |
| 9,000 to 35,000 |
25% |
| 35,000 to 55,000 |
30% |
| 55,000 to 80,000 |
35% |
| Over 80,000 |
45% |
Monthly taxable income after deducting the monthly
standard deduction (see the Deductions section for more
information).
Where an individual's income tax liability is borne by
the employer, the tax liability is calculated on a
grossed-up basis (i.e. tax on tax).
China Income Tax Rate for Individual Tax Payers
Lowest Individual Tax Rate is 3% and Highest Rate is 45%
| Monthly Taxable Income (RMB) |
Tax Rate |
| 0 to 1,500 |
0% |
| 1,500 to 4,500 |
10% |
| 4,500 to 9,000 |
20% |
| 9,000 to 35,000 |
25% |
| 35,000 to 55,000 |
30% |
| 55,000 to 80,000 |
35% |
| Over 80,000 |
45% |
The table relates to income from a salary. Income from other business is taxable at 5% - 35%.
Passive income such as interest and royalties is taxable at a standard rate of 20%.
Corporate Income tax rate for domestic and foreign companies is 25%.
In certain cases small companies pay 20% corporate tax
Tax rate for Hi-tech companies is 15% corporate tax.
An individual's capital gains are taxable in China at the rate of 20%.
Capital gains tax for a Chinese company is added to the regular tax.
A 10% deduction at source is made from the capital gains of a foreign company in China.
On taxing capital gains from the sale of real estate, when calculating the capital gain the purchase cost is deducted from the sale price at the 20% rate.
Employers are obligated to deduct tax at source on a monthly basis from a salaried employee and to make additional contributions to social security.
Social security in China consists of 3 parts, basic pension, personal accounts and additional payment.
The rates for social security vary in
different cities.
Rates in the major cities are employer - around 30%, employee ?
around 11%.
The following payments to non-residents are subject to a
deduction of tax at source:
Dividend - 10%.
Interest - 10%, (plus 5% business tax)
Royalties -10%
Capital gains -10%
Comments
Deductions at source for payments to foreign residents is
subject to the Double Taxation Prevention Treaty.
The tax year in China ends on December 31. It is compulsory to file a report and pay advances monthly or quarterly (monthly for individuals).
The date for submitting an annual report and arranging payments is up until May 31. There are fines on arrears. Foreign companies in China are obligated to submit an interim report every three months (advance payments should be paid within 15 days of the end of the quarter).
In most cases when the annual income is less than CNY 120,000 an individual whose entire income in China is from a salary or whose income is subject to a deduction of tax at source is exempt from submitting an annual report.
An employer is obligated to submit a monthly report on his employees' wages and to pay the tax deducted within 7 days of the end of the previous month.