Reply To: How to lower China expat income tax burden?

Home Forums How to lower China expat income tax burden? Reply To: How to lower China expat income tax burden?


As far as i know i can lower my taxable income with a living allowance (housing) and a cost of living allowance (meaning dinners, my bills, taxi rides, super market receipt??? what else?) These amounts will both have to put in my employment contract for or i won’t be able to use this

What are the max percentages for this based on a gross salary? 30/40/50%

What about medical insurance – this is a yearly bill – can this be deducted? same for yearly trip home – can the ticket price be deducted? 

How does this work on monthly bases since these get paid once a year and only a single fapiao?

What are others on here doing for this?

The PRC has cracked down on allowances for expats.

The normal value is about 25% of monthly income now from what I’ve seen.

This includes housing, food (groceries or restaurants), laundry, domestic travel. 

Education costs may be a separate issue as are plane tickets home if its part of your contract.

To claim the monthly tax-free allowance you need to provide fapiaos.

Employer-paid portions of Medical and Life insurance is fully taxable.

Also employers portions of SS and or pension plans is now fully taxable by your friendly Uncle CCP 

For the monthly claims your company must agree to do the work if they done you are pretty much done also.

I’m starting work for a new Chinese company. I read here that deductions need to be mentioned in the work contract.

1. How to mention tax deductible benefits on the employment contract (to reduce the amount of income tax paid)? I know that I will have to provide fapiaos to the tax office. Does each separate item like living expenses, flights home etc. need to be mentioned? If so, where can I get a list of what is deductible? 

2. Does a total amount for all this need to be mentioned in the contract? 

2. How much social insurance will the company need to pay for me? How much will I need to pay?

Thanks in advance

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