Preferential Personal Income Tax Policies For Foreigners

[dropcap]A[/dropcap]ccording to Article 20 of the notice of the Ministry of Finance and the State Administration of Taxation on several policy issues of individual income tax (1994): the following income shall be exempted from individual income tax temporarily.

– Housing subsidies, food subsidies, relocation expenses and laundry expenses obtained by foreign individuals in the form of non cash or reimbursement;

– Subsidies for domestic and foreign business trips obtained by foreign individuals according to reasonable standards;

– The family visit fee, language training fee and children’s education fee obtained by foreign individuals shall be considered as a reasonable part after being examined and approved by the local tax authorities;

– Income from dividends and bonuses obtained by foreign individuals from enterprises with foreign investment;

– The income from wages and salaries obtained by foreign experts who meet one of the following conditions can be exempted from individual income tax:

1. Foreign experts directly dispatched by the world bank to work in China according to the special loan agreement of the world bank;

2. Experts directly sent by United Nations organizations to work in our country;

3. Experts working in China for UN Assistance Projects;

4. Experts sent by donor countries to China to work for the country’s free aid projects;

5. The wages and salaries of cultural and educational experts who work in China within two years according to the cultural exchange project signed by the two government shall be borne by the country;

6. The wages and salaries of cultural and educational experts who work in China for less than two years under the international exchange program of Chinese colleagues and universities shall be borne by the country;

7. The wages and salaries of experts working in China through non-governmental scientific research agreements shall be borne by the government agencies of the country.