Provisions on the Amount of Individual Income Tax Payable
The Calculation of the amount of individual income tax payable shall be separately made based on various taxable items. The balance between the income under a certain taxable item and the standard for the additional deductions for expenses under the same item is the taxable income under the same item.The standard for the additional deductions for expenses of individual income tax levied on Chinese citizens shall be RMB 800 (In certain areas, such standard is quite different, for example the standard in Shenzhen is RMB 1,600.)
The standard for the additional deductions for expenses of individual income tax levied on foreign people shall be RMB 4,000.
Quick Calculation Deduction Table Applicable to Wages and Salaries
| Grade | Monthly Taxable Income | Tax Rate (%) | Deduction of Quick calculation |
| 1 |
income of RMB 500 or less
|
5 | 0 |
| 2 |
that part of income in excess of RMB 500 to RMB 2,000
|
10 | 25 |
| 3 |
that part of income in excess of RMB 2,000 to RMB 5,000
|
15 | 125 |
| 4 |
that part of income in excess of RMB 5.000 to RMB 20,000
|
20 | 375 |
| 5 |
that part of income in excess of RMB 20,000 to RMB 40,000
|
25 | 1,375 |
| 6 |
that part of income in excess of RMB 40,000 to RMB 60,000
|
30 | 3,375 |
| 7 |
that part of income in excess of RMB 60,000 to RMB 80,000
|
35 | 6,375 |
| 8 |
that part of income in excess of RMB 80,000 to RMB 100,000
|
40 | 10,375 |
| 9 |
that part of income in excess of RMB 100,000
|
45 | 15,375 |
Individual income tax shall be levied upon the following items:
- income from wages and salaries;- income from production or business operation derived by individual ;
- income from contracted or leased operation of enterprises or institutions;
- income from remuneration for personal services
- income from author's remuneration;
- income from royalties;
- income from interest, dividends and extra dividends;
- income from transfer of properly
- contingent income
Confirmation of the Place Where Wages and Salaries Sources Come from
The income derived from sources within China shall mean income actually obtained by an individual, the source of which is inside the People's Republic of China. Wages and salaries actually given during the working period in China, no matter paid by domestic or overseas enterprises or individuals due to employment, shall be income derived from sources within China; The income actually obtained by an individual during the working period outside China, no matter paid by domestic or overseas enterprises or individuals due to employment, shall be income derived from sources outside China.As of July 1, 2004, individuals who are not domiciled in the People's Republic of China, but who reside inside the People's Republic of China consecutively or accumulatively for more than 90 days in any one Tax Year; or for more than 183 days during the period set forth in a tax agreement shall pay individual income tax.
