Xina flag Xina: Entorn econòmic

Impostos a la Xina


Consumption taxes

Nature of the tax
Value added tax (VAT) and Consumption tax
Tax rate
While the standard rate is 13%, it varies depending on the taxpayer status, type of product and service and type of sector.
Reduced tax rate
Goods and services taxable at 3% include certain taxable used goods, consignment goods sold by agencies, certain goods sold by pawnbrokers, specific duty-free items from duty-free shops, certain electricity by qualified hydroelectric businesses, certain construction materials, certain biological products, tap water (if simplified computation method is chosen), certain concrete cement goods by general taxable persons, non-academic education services, interest income from agricultural loans by Agricultural Development Bank of China and affiliates, certain rare disease drugs (orphan drugs).

Goods and services taxable at 5% include labour dispatching services and human resource outsourcing services.

Goods and services taxable at 6% include R&D and tech services, IT services, culture and creative services, logistics support, authentication and consulting, radio/film/TV services, business support, other modern services, value-added telecom services, loan services, direct financial services, insurance, financial product trading, cultural/sports services, education/medical services, tourism/entertainment, catering/accommodation, daily services, other lifestyle services, intangible asset sales.

Goods and services taxable at 9% include agricultural products (including grains), tap water, heating, liquefied petroleum gas, natural gas, edible vegetable oil, air conditioning, hot water, coal gas, household coal products, food-grade salt, farm machinery, fodder and pesticides, agricultural film, fertilizer, methane gas, dimethyl ether, books, newspapers, magazines, audiovisual products, transportation services, postal services, basic telecommunication services, construction services, sales of immovable properties acquired or developed after 1 May 2016, leasing of immovable properties acquired or developed after 1 May 2016, transfer of land use rights.

Zero-rated (exempt-with-credit) goods and services include exports of goods (excluding prohibited or restricted exports) and services rendered by domestic entities or individuals to overseas entities and consumed entirely outside the country, including international transportation services, including transportation services for Hong Kong SAR, Macau SAR and Taiwan, China; space transportation services; research and development services; contractual energy performance services; design services; radio, film and television programs (works) production and distribution services; software services; circuit design and test service; information systems services; business process management services; offshore outsourcing services, including information technology outsourcing (ITO), business process outsourcing (BPO) and knowledge process outsourcing (KPO); technology transfer.

Taxpayers that supply items eligible for VAT reduction must book these sales separately. Otherwise, no reduction applies.

To support small- and micro-sized enterprises (SMEs) and individual businesses, VAT reduction and exemption policies for small-scale taxable persons have been extended. From 1 April 2021 to 31 December 2027, small-scale taxable persons will have a reduced VAT rate of 1% on taxable sales revenues normally subject to 3%. For items requiring VAT prepayment at 3%, the prepayment rate is also reduced to 1%.

Other consumption taxes
Consumption tax applies to prescribed nonessential and luxury or resource-intensive goods (including alcohol, luxury cosmetics, fuel oil, jewellery, motorcycles, motor vehicles, petrol, yachts, golf products, luxury watches, disposable wood chopsticks, tobacco, certain cell and coating products), and it mainly affects companies involved in producing or importing these goods. The tax is calculated based on the sales value of the goods, the sales volume or a combination of the two. Exports are exempt.

A tobacco tax is levied on the purchase of tobacco leaves within the country's territory, at the rate of 20% of the purchasing value.

Stamp duties may be levied on specific legal documents (rates between 0.005%-0.1%).

China levies a motor vehicle acquisition tax on the purchase and importation of cars, motorcycles, trams, trailers, carts, and certain types of trucks. The rate is equal to 10% of the taxable consideration. A vehicle and vessel tax is also levied at fixed amounts according to the weight.

A vessel tonnage tax is levied on any vessel entering a port inside the territory of China from overseas, calculated according to the tonnage multiplied by the applicable tax rate that is determined based on the net tonnage and the term of the tonnage tax license.

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Corporate taxes

Company tax
Corporation tax rate for foreign companies
A non-resident enterprise that has no establishment or place in China is taxed only on its China-source income. A non-tax resident enterprise with an establishment or place in China is subject to corporate taxes on income derived by such establishment or place from sources in China as well as income derived from outside the country that is effectively connected with such establishment or place.
A 10% withholding rate (temporarily reduced from 20%) is applied to China-sourced income not related to a non-resident enterprise’s establishments in China, or China income derived by non-resident enterprises without establishments in China.
Capital gains taxation
There is no separate capital gains tax in China; capital gains (and losses) of companies generally are combined with other operating income and taxed at the corporate income rate (25%).

The sale of real estate and net development costs are subject to the land appreciation tax at four bands ranging from 30 to 60% (depending on the percentage of the gain realised).

Main allowable deductions and tax credit
Generally, all documented expenses, costs and losses in generating taxable income are deductible up to a limit: entertainment expenses are 60% deductible up to 0.5% of total income, advertising (up to 15% of total income, 30% in some cases) and donations (up to 12% of total income; although donations for poverty alleviation in certain areas can be fully deducted). Non-deductible items include dividends, management fees, Enterprise Income Tax (EIT) paid and late tax payment surcharge fees.

A deduction is allowed for the amortisation of intangible assets, including patents, trademarks, copyrights, and land use rights. Intangible assets have to be amortised over a period of at least ten years. Organisational and start-up expenses are tax-deductible fully in the first year of activity. Interest on loans is also tax-deductible (subject to conditions). 200% of the salary expenses paid to handicapped staff are deductible.

200% of contributions to non-profit R&D institutions, higher education institutions, or government natural science funds for basic research are deductible. Starting 1 January 2023, 200% of eligible R&D expenses are tax-deductible. For intangible assets formed from these expenses, tax amortization is based on 200% of their cost. From 1 January 2023 to 31 December 2027, integrated circuit enterprises and industrial mother machine manufacturers can deduct 220% of eligible R&D expenses. Tax amortization for intangible assets from these expenses is based on 220% of their cost.

Tax losses can normally be carried forward for a maximum of five years starting from the year subsequent to the year in which the loss was incurred, while carryback of losses is not permitted.

Preferential tax treatments in the form of incentives are further granted to new high-technology enterprises (HNTE), companies in special economic zones (SEZ) and pilot free trade zones (FTZ), while exemptions may apply to agriculture, forestry, fishery, software, infrastructure and other specified environment and technology developments.

Other corporate taxes
A real estate tax, based on property value or rental income, is assessed annually on business or leased land and buildings. The tax rate is 1.2% of the original building value, with local governments often offering a 10% to 30% reduction. Alternatively, the tax can be 12% of rental income. This tax is deductible for CIT purposes. Furthermore, an urban land usage tax is imposed on the land area occupied, with rates ranging from RMB 0.6 to RMB 30 per square meter. Additional minor local levies may also apply. An arable land occupation tax also applies on companies and individuals who build houses or carry out non-agricultural construction on arable lands.

A deed tax, typically ranging from 3% to 5%, may be levied on the purchase, sale, gift, or exchange of land-use rights or real property ownership. The transferee/assignee is responsible for paying the tax.

The sale of real estate and net development costs (or land use rights) are subject to the Land Appreciation tax at 30 to 60% (depending on the percentage of the gain realised).

Stamp duty (0.005% - 0.1%) is levied on specific legal documents.

The employer contributes around 16% of the basic payroll to the state-administered retirement scheme, as well as to medical insurance, maternity insurance, unemployment insurance, and work-related injury insurance funds (bringing the total to up to 40% of base monthly salary, with actual rates varying across the country - it is 28% in Shangai).

An urban construction and maintenance tax is levied on the amount of indirect tax (VAT, consumption tax), at a rate of 7% for urban areas, 5% for county areas, and 1% for other areas.

An educational surtax of 3% is imposed on the amount of China's indirect taxes (VAT and consumption tax) payable by the taxpayer. Additionally, a local educational surtax of 2% is also levied on the same amount. Thus, taxpayers of indirect taxes are also subject to both educational surtaxes.

A motor vehicle acquisition tax is levied at 10% of consideration on automobiles, tramcars, trailers, and motorcycles. A vehicle and vessel tax also applies (generally at fixed amounts).

Companies and individuals active in the entertainment and advertising businesses are subject to a cultural business development levy at 3% on the relevant income.

Local authorities levy a resources tax on natural resources, including crude oil, natural gas, coal, salt, raw metallic metals, non-metallic metals, mineral water, carbon dioxide gas, and water (in 10 provinces). This tax is applied on a sales turnover or tonnage/volume basis.

An environmental protection tax (EPT) is levied on enterprises that directly discharge taxable pollutants within the Chinese territory. It is calculated based on the volume of pollutants discharged multiplied by a specific EPT coefficient.

Other domestic resources
State Tax Administration

Country comparison for corporate taxation

  Xina East Asia & Pacific Estats Units Alemanya
Number of payments of taxes per year 7.0 23.4 10.6 9.0
Time taken for administrative formalities (Hours) 138.0 195.1 175.0 218.0
Total share of taxes (% of profit) 59.2 33.8 36.6 48.8

Font: Doing Business, last available data.

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Individual taxes

Tax rate

Income from wages/salaries Progressive rates
Annual taxable income (after deducting the standard basic deduction, specific deductions, specific additional deductions, and other allowable deductions)
CNY 0 - 36,000 3%
CNY 36,000 - 144,000 10%
CNY 144,000 - 300,000 20%
CNY 300,000 - 420,000 25%
CNY 420,000 - 660,000 30%
CNY 660,000 - 960,000 35%
CNY 960,001 and above 45%
Income from Private Businesses Progressive rates (Taxable income = Total Revenue - Costs - Expenses - Losses)
CNY 0 - 30,000 5%
CNY 30,000 - 90,000 10%
CNY 90,000 - 300,000 20%
CNY 300,000 - 500,000 30%
CNY 500,001 and above 35%
Non-resident (employment income, remuneration for labour services, author’s remuneration,royalties - calculated by each category on a monthly or transaction basis) Progressive rates (3-45%)
CNY 0 - 3,000 3%
CNY 3,000 - 12,000 10%
CNY 12,000 - 25,000 20%
CNY 25,000 - 35,000 25%
CNY 35,000 - 55,000 30%
CNY 55,000 - 80,000 35%
CNY 80,001 and above 45%
Incidental income, rental income, interest income, dividends, and capital gains Flat rate at 20%
Allowable deductions and tax credit
Deductions and allowances are available, depending on the category of income. For wages and salaries received in China, individuals also receive a flat monthly deduction of CNY 5,000.

Personal basic contributions are deductible. These include payments to housing funds and certain medical insurance, pension and unemployment insurance payments. Taxable income from personal services, royalties and remuneration from manuscripts and the leasing of property is net of a standard deduction for expenses that is equal to 20% of total income. Reasonable business expenses incurred in earning income from a business are deductible. Rental income is also subject to deduction (according to the monthly amount received). For sales of property, the original cost of the property and reasonable expenses incurred are deductible from the sales proceeds to determine the taxable income.

Certain specific deductions also apply, including child education (CNY 2,000 per child per month); continued education (CNY 400 per month or 3,600 per year depending on the type of qualified continued education); mortgage interest (CNY 1,000 per month); rental expense (CNY 800, 1,100, or 1,500 per month depending on the location); elderly care (up to CNY 3,000 per month depending on the status of the taxpayer); major medical expense (qualified self-paid portion above CNY 15,000 and capped at CNY 80,000 per year for each eligible individual); care expense for children under the age of 3 (CNY 2,000).

Charitable contributions to qualified domestic non-profit organisations are deductible up to 30% of taxable income.

Losses from privately-owned businesses and sole proprietorship enterprises can be carried forward for five years.

Special expatriate tax regime
Residents are subject to individual income tax on their worldwide income. Non-residents are generally taxed only on their China-sourced income.
For the rates applied on non-residents' income derived from employment, remuneration for labour services, author’s remuneration, and royalties, see the table above.

Certain categories of income are considered China-sourced income regardless of whether the payments are made within China or not, including:

  • Income derived from employment or contracted labour services performed within the territory of China
  • Rental income in relation to property used within the territory of China
  • Income derived from the transfer of real property located within China or other property transfer transactions incurred within the territory of China
  • Income derived through the grant of various franchises to be used within the territory of China
  • Interest and dividend income paid by companies, enterprises, other organisations, or resident individuals within the territory of China.

When calculating taxable employment income for non-residents, IIT law only allows the standard basic deduction of CNY 5,000 per month.
Foreign individuals are subject to deed tax and stamp duty upon the purchase of real property in China.

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Double taxation treaties

Countries with whom a double taxation treaty have been signed
International tax treaties signed by China
Whithholding taxes
Withholding tax rates in China are 10% for dividends, interest and royalties paid to non-resident companies (0% for resident companies). When paid to resident and non-resident individuals, the rate is 20%.
A 6% VAT generally applies to interests and royalties (which could be waived in case of royalties paid for technology transfer).

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Sources of fiscal information

Tax Authorities
State Taxation Administration
Other domestic resources
China Briefing - Tax Guide

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