Job Discussion Forums

[Susie]

Please could someone advise as to how I can get a tax payment form from my former employer sooner rather than later? I am in Guangdong.

My contract states that the employer 'has to pay the employee's personal income tax each month and a tax payment form will be given to the employee for record'.

In another letter from the ex-boss, he wrote '...you will be given...a letter certifying how much tax you have paid...before the end of June.'

It took me hours to persuade the former boss to give me that interim letter (that is, a letter between the end of contract date and a future date when/if he gives a tax payment form) stating the amount of net salary I earned, the total sum of RMB personal income tax to be paid on my behalf for the employment period (the boss has admitted to not paying my tax yet), and including a phrase that 'a tax payment form will be given to her by the end of August this year for record'.

I have asked the ex-boss why he has not paid my tax yet and why he has asked me to wait until the end of August 2003 for a tax payment form, but I still don't understand his answer. His answer was that the Guangzhou tax bureau has a bank account into which employers pay the tax they owe, that the money goes in and it takes time for the bureau to issue receipts or tax payment forms, that he will pay the tax as a lump sum, that the tax bureau won't come after the employee if tax isn't paid!

I just want my tax payment form. My contract tells that I should have a copy. I wonder though, is it harmless to wait until the end of August for a tax payment form even though I (and four other foreigners were too) was released from work at the end of June (some weeks earlier than the initially agreed final contract date - for cost cutting reasons)?

The other foreigners have had their tax receipts because they had negotiated gross salaries (I negotiated a net salary after tax) and they threatened to bring all kinds of external pressures to bear on the boss (such as contacting their Embassies, Consulates in GZ - mine is in Beijing; going direct to the tax bureau to get the receipts themselves, etc.).

Your sensible advice in this matter would be most welcome.

[Roger]

Hello Susie,
I do not know about this "form", but I did pay a 20% salary tax on some income I realised as a teacher (part-time) at a private company (not involved in teaching).
Because it was a foreign-owned business, they had to deduct my tax direct from my salary. IT was three items (one of them, if I remember well, was a tiny percentage in administration costs). The company had to submit a declaration from my first employer that I was free to make extra money (which does not apply to you, but just goes to show how well organised this tax paying system is).
I only received a receipt every month stating how much they (my employer) had deducted, and to what purpose; the receipt was from an authority (the local tax collecting agency, I suppose, I have not got any receipt around here).
The purpose of these receipts is to document to the relevant authorities that you did pay your tax. This 'relevant' authority can be the Immigration at the border, although I have never had to produce any receipt yet at Shenzhen or Zhuhai exits.

Do insist that they issue you with these receipts as soon as possible - claim (not untruthfully!) that you need them to cross the border to Hong Kong (you might end up having to show you paid tax on the mainland!). This might easily become fact once your work visa is on the point of expiring! If you want an extension from the PSB, you might then have to proof to the police that your boss had deducted your portion of the tax.

[smarts]

You may have to wait until hell freezes over before you get your tax payment form / receipt/ whatever.

best thing to do is ask the school to write something on school letterhead paper that includes "all the personal income tax has been paid by the school"......and then get them to autograph it and most importantly,

....... put their red stamp on it along with the date.

that way at least you've got something in writing, and they should be able to do that almost immediately..without having any further excuses....

[Susie]

Smarts,

I've got the letter that you suggested, but is it a valid substitute for a tax payment form (after all the ex-boss has admitted to not having paid my tax yet).

[smarts]

I'm not sure if a letter form your employer is a valid substitute for a tax payment form.

What is a tax payment form?. I'm sure it varies from province to province and city to city......and it also depends on what you want or need it for.

In any event, getting a letter from your employer / ex employer is a good starting point.

You must ensure that it explicity states something like......."ALL OF THE INDIVIDUAL INCOME TAX HAS BEEN PAID BY THE EMPLOYER"

and it must have the school stamp on it (that is very important too!)

[oprah]

We were told that if we made under 4000 rmb, eg 3800 then we do not pay tax as it is under the taxable amount. Hope this is the case.

[Minhang Oz]

It is the case, but if you want to change money legally, you still must show that tax has been paid by your employer. This is the tax receipt people are talking about, and the reason more people look for a blackmarket dealer; not for a profit, but to stop the interminable stuffing around!

[Susie]

Oprah

I have been told that, for foreigners, RMB4,000.00 is tax free.

What was my original question?

[Roger]

My receipt is an half-page (half A 4) piece of paper stamped by the local tax bureau; it states the actual salary and the deducted amount (tax).
They postitched a much smaller paper to this document, one bearing a stamp from the tax bureau and merely stating my monthly pay.
I suppose that if the Immigration or PSB really want to know if you have paid taxes, you will have to show receipts for the entire period you have been gainfully employed within the visa duration period. If there is any gap (holidays, for instance), I do not know how you can prove that you have discharged your duties.
Anyway, I have so far not been asked to prove that I have paid up; but I am fairly certain this is only a matter of time.
They might modify our FE booklets so that tax payments could be entered there. When you surrender it at the end of your stint, you can leave China if you have paid all dues, and you cannot leave without paying any balance.
That's what I think they will eventually introduce.
Besides this, a note: If you are not legal (i.e. working on an F visa, or worse still, an L visa), you canNOT pay taxes through your employer!

[Joe C.]

The tax issue is probably a bit different depending on which province you are in. In Guangzhou, some employers give you an official tax receipt (resembling the "fa piao" you get when you purchase something) every time you get paid. I have seen these issued even to those who are working on other than a valid �Z� visa.

The policy of not paying tax on income lower than 4,000 RMB has to do with what type of company employs you. According to the GZ tax authorities, only if you are working for a joint-venture enterprise does that policy apply.

Actually, I wouldn�t worry about any tax receipts. It is extremely unlikely that the authorities will require you produce them unless you are dealing with a bank loan and need to prove how much money you earn or, as some have pointed out, to exchange RMB for foreign currency. However, exchanging money in the bank is such a pain in the neck that virtually anybody is better off using the black market.

[Bertrand]

I've come across this before. Invariably it suggests that your employer has been somewhat parsimonious with the truth. I bet he has been paying you x, but has been registering you as having been paid, say, half x (in order, of course, to save having to pay income tax for and on your behalf). I would advise that you simply ask him if this is the case.

[Joe C.]

[Bertrand]

[Susie]

I finally got an official and valid tax payment form. How? Weekly positive and polite emails to ex-boss explaining that my banking transactions can proceed once I have the tax form.