As far as I know, many foreign individuals have better understanding of individual income tax in China. i.e the golden rule of 90 or 183 days (how many days should I stay in China so I can decrease the tax burden), filing the annual individual income tax returns prior to March 31 in following year if the annual income more than RMB120, 000, or as a foreign individual, he or she has tax allowance RMB4, 800 per month compared to a Chinese individual RMB3, 500 etc. the discrepancy is around RMB1, 300.

Today, we are going to talk about more individual income tax allowances (tax exempt) for the foreign individuals.

In accordance with the Chinese Individual Income Tax law, if a foreign employee gets paid for the following items from the employer, he or she does not pay individual income taxes from the employer.

l  Housing/ Food/ Relocation/ Laundry subsidy   

Note：The four subsidies must be adopted non-cash or no-gain-no-loss payment. i.e. the company directly pay the costs to the service suppliers or pay the employees with the same amount they have paid (the invoice must be collected as well).

l  Domestic and overseas travel subsidies.

Note：It requires the amount is within the reasonable range.

l  Family visiting/language training/children education costs.

Note：The amount must be reasonable and is subject to amount approval of tax bureau in specific situations.

In a word, when the foreign employees enjoy the employer’s benefits, these reasonable income will be exempt from individual income tax.

Keywords: Ningbo accounting, Ningbo Auditor, Ningbo accountants, Ningbo CPA

关键词：宁波会计，宁波审计，宁波会计师，宁波涉外会计，宁波注册会计师

Victor & Truman，CPAs  宁波纬度会计师事务所（普通合伙）