Job Discussion Forums

[Klamm]

If anyone could clarify this it would help. Is there a website with info on what taxes foreigners must pay?

My salary is 4,500 and the school wants to tax that straight up but I believe the first 4,000 is untaxed and amounts after that are taxed at a fairly high rate. Isn't this correct? I may need back up info. I know this issue has been discussed but has anyone gotten solid evidence as to the correct info on taxes?

K.

[e_jorgensen]

Foreign teachers rarely pay income tax. Usually, if they qualify for income tax, employers will pay the tax, or lie about your salary to the government and pay nothing. Ask for a tax receipt if you're worried. Being that your salary is 4,500 it sounds like your school is just looking for deductions. How much do they want to take out for tax, if you don't mind me asking?

[Roger]

This has recently been discuss3ed ad nauseam, and I even felt, people were being misled.
It's true that most teachers pay no tax but that doesn't mean they are enjoying a legal excemption. They don't pay because the local authorities havlegal provisions yet.

Here is from almost the horse's mouth:

EXPAT STAFF AND INDIViDUAL INCOME TAX

Expat staff have to register with the Tax bureau, Immigration Dept. and Public Security Bureau to obtain work permits, visas and residents permits. Individual Income Tax for expats in Chinlated on a sliding scale as follows:

Monthly Salary IIT rate RMB Deduction
To RMB 4.000 0 0
4000-20'000 20% 375

(Dezan Shiran $ Associates China, CHINA BRIEFING July/August;
www.china-briefing.com)

The essence of this reply is that yes, your first 4000 RMB get a tax holiday, but from your monthly income of 40001 they deduct 20%.

Sometimes they apply a lower rate - local authorities can make pretty autonomous decisions, it seems.

[burnsie]

Moreover on what Roger pointed out. Foreigners DO HAVE TO PAY TAX.

Another point is FOREIGN TEACHERS DO NOT USUALLY CONSIDER THAT THEY HAVE TO PAY TAX. Only when they receive their first payslip and see tax part of it is missing then they ask questions. So find out first up.

The official line is:-

First 4,000 RMB is tax exempt.
Next 500 RMB is taxed at 5%
Next 500-2000 RMB is taxed at 10%
Next 2000-5000 RMB is taxed at 15%
Next 5000-20000 RMB is taxed at 20% and so on.

So if you earn 9,000 RMB then the tax is:-

First 4,000 tax exempt
Next 500 at 5% - 25 RMB
500 to 2000 at 10% - this is 1500 RMB total so 150 RMB is tax
2000 to 5000 at 15% - this is 3000 RMB total so the tax is 450 RMB is tax

You end out paying around 625 RMB in tax.

So for your 9,000 pre tax wage you end out getting 8,375 RMB. That's if my maths is right.

Under some schools they split the amount up so the base is around 4,000 RMB and then they add extra in the appendix or somewhere to make up the final amount that they agreed on by the school. This avoids the tax.

Hope this helps.

[Klamm]

Thanks guys. They were going to try and take 430 Rmb out of my 4,500 Rmb salary. I think I might have enough proof to turn the scale. There must a webpage from the Chinese government? I checked the website Roger gave and it could not connect.

But at least I know that this recruiter is trying to pull a fast one.

K.

[Roger]

I don't know burnsie's table; sounds rather nice but in practice you will have to pay either zero or much more.
The website I mentioned is owned by Dezshira & CO., Peking, which is a British consultancy company. You can pick up their free flyers in many luxury hotels.
What I copied - i.e. 4001 - 20'000 at a tax rate of 20% - is from their July/August flyer.
You can ask them by email, and they will most likely reply.

[burnsie]

Yes my maths is not my strong point.

Anyway this is what my Chinese partner has provided me from the China Tax Bureau.

Check out the following link and do the maths yourself.

http://www.ey.com/GLOBAL/content.nsf/China_E/Media_Center_-_News-12-06-2003

[burnsie]

Actually for this case anyway for a 4,500 RMB wage you only pay for the first 500 RMB because the first 4,000 is tax exempt.

Even at 20% tax above 4,000 RMB is 100 RMB not the 430 RMB this school/agency is saying.

[Antaraaaa]

What do you think of someone ( a buddy) being told they will be deducted 16% tax on 2 weeks work totalling 4000 rmb? That's like 640 rmb!

Can they be serious? lmao, I think this MUST be some kind of joke, right?

[brsmith15]

See if you can be paid as a "consultant." No tax.

[mandu]

i get 10,000 a month and i dont get taxed.

i started out on 4000,next job i got 6500 and never been taxed.

[kev7161]

I get paid 5000 monthly and have never been taxed. Not that I'm complaining, mind you.