* A foreigner could be a “resident individuals”

individuals who do not have a domicile in China but have resided in China for 183 days or more cumulatively within a tax year, shall be deemed as resident individuals.

* When a foreigner resides in China for 183 days or more cumulatively during a tax year

1. Where the foreigner resides in China for 183 days or more cumulatively per tax year for less than six consecutive years.

his/her income from all salaries shall be subject to individual income tax, except for the portion of salaries paid by an overseas employer.

The formula is as follows:

2. Where the foreigners resides in China for 183 days or more cumulatively per tax year for more than six consecutive years.

his/her income from salaries derived in China and overseas shall be subject to individual income tax.

* Computation of tax payable

1）Resident individuals.

Tax payable over all comprehensive income shall be subject to individual income tax annually, the formula for computation of tax payable is as follows:

Tax payable for annual comprehensive income = (annual salary – deduction – special deduction – special additional deduction – other deductions determined pursuant to the law) × applicable tax rate – quick deduction.

* Year-end bonus

Before 1 January 2022，year-end bonus will not be treated as “comprehensive income” such as salary, or monthly bonus. This bonus shall be apportioned over 12 months for tax computation purpose, with no deduction, and subject to the Monthly Tax Rate Table for computation of tax payable;  this tax computation method can only be applied once within a calendar year.

The computation formula shall be as follows:

Tax payable = [ × applicable tax rate – quick deduction] × 12

* Allowances and subsidies and special additional deduction

Before 1 January 2022, a foreigner may choose to claim deduction for eight allowances and subsidies such as: housing allowance, child education fee, language training fee etc, instead of claiming special additional deduction. After 1 January 2022, only special additional deduction available.

Note: special additional deduction, including children's education, continuing education, medical treatment for major illness, housing loan interest or housing rent, support for the elderly, will be deducted as per provision.

* Quick Computation Chart for Individual Income

Applicable to yearly comprehensive income

Applicable to monthly comprehensive income

Example A:

David’s yearly salary: 360000RMB, allowance is 120000RMB, the taxable income is 360000—60000-120000=180000RMB， so

tax=180000*20%-16920=19080RMB

Example B:

David get a year-end bonus, which is 50000RMB,

50000/12=4166.67

Tax=(4166.67*10%-210)*12=2103.34RMB.

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