Tax Guide for Expats

The only tax category expats likely need to pay close attention to while living in Beijing is the individual income tax (unless you purchase a home or car, which will be taxed). Income tax is imposed on a sliding scale. For those living and working in Beijing for less than one year, you’ll be liable for individual income tax (IIT) on your earnings in China. If you stay for more than a year, your worldwide earnings will also be taxed in China. China currently has signed the Double Taxation Prevention Treaty with nearly 70 countries which means that most people will never have to pay tax at both home and abroad.

Additional sales taxes are not imposed when shopping or eating out. VAT taxes and consumption taxes are built into the prices of products and are therefore not noticeable to consumers purchasing products retail.

In general, there are 26 taxes in China, which can be classified into 7 categories:

  • Turnover taxes, including Value-added Tax, Excise Tax, Business Tax and Customs Duty.
  • Income taxes, including Enterprise Income Tax for domestic enterprises, Income Tax on Enterprises with Foreign Investment and Foreign Enterprises and Individual Income Tax.
  • Resource taxes, including Resource Tax and Urban and Township Land Use Tax.
  • Property taxes, including House Property Tax and Urban Real Estate Tax.
  • Taxes for special purposes, including City Maintenance and Construction Tax, Fixed Assets Investment Orientation Tax, Land Appreciation Tax and Vehicle Acquisition Tax.
  • Behavior taxes, including Vehicle and Vessel Usage Tax, Vehicle and Vessel Usage Plate Tax, Vessel Tonnage Tax, Stamp Duty, Deed Tax, Slaughter Tax and Banquet Tax.
  • Agricultural taxes, including Agriculture Tax, Agricultural Specialty Tax, Animal Husbandry Tax, and Farmland Occupation Tax.