If you are a foreigner residing in China long-term, you may have heard the following regulations regarding foreigners’ individual income tax (“IIT”) payment in China: “For a non-domiciled individual who has resided in China for a cumulative 183 days in a tax year, if they have resided in China for a cumulative 183 days each year in the previous six years and have not had a single departure exceeding 30 days in any of those years, their income derived from both within and outside China in that tax year shall be subject to individual income tax; if in any of the previous six years, their cumulative days of residence in China were less than 183 days or they had a single departure exceeding 30 days, the income derived from outside China and paid by an overseas entity or individual in that tax year shall be exempt from individual income tax.” Please check our previous post for more information: How Much IIT a Foreigner Have to Pay in China
However, this regulation leaves some detailed questions unanswered. To address this, we’ve compiled the following information based on relevant announcements from the State Taxation Administration, in the hope that it will be helpful to you.
Q1. How is the number of days a foreigner resides in China calculated?
A: A day of stay in China that is a full 24 hours shall be counted as a day of residence in China; a stay of less than 24 hours shall not be counted.
For example, David lives in Hong Kong. He comes to work in Shenzhen every Monday morning and returns to Hong Kong every Friday evening. The stays on Monday and Friday are each less than 24 hours, so they are not counted as days of residence in China, and the two weekend days are also not counted. Thus, only 3 days per week can be counted. Calculated based on 52 weeks a year, his total days of residence in China for the year amount to 156, which does not exceed 183 days, so he does not qualify as a tax-resident individual. All his overseas income is exempt from individual income tax.
Q2. For a foreigner who has “resided continuously for six years” in China, from which year does the calculation start?
A: The starting point for the consecutive “six-year” period (with cumulative 183 days of residence in China each year) is 2019 (inclusive). All years of residence before 2018 (inclusive) are uniformly “reset” and not counted.
Therefore, by 2024 (inclusive), all non-domiciled individuals have resided in China for less than six years, and their overseas income paid from overseas can enjoy tax exemption. In addition, if there is a single departure exceeding 30 days in any year starting from 2019, the previous consecutive years will be “reset” and the calculation will start anew.
For example, David, a Hong Kong resident, came to work in Shenzhen on January 1, 2013, and returned to work in Hong Kong on August 30, 2026. During this period, except for a temporary return to Hong Kong to handle official business from February 1 to March 15, 2025, he stayed in Shenzhen for the rest of the time.
If calculated from 2013, the number of years David has resided in China for a cumulative 183 days would actually be six years. However, since the years before 2018 are uniformly “reset” and the calculation starts from 2019, during 2019-2024, David has resided in China for a cumulative 183 days for less than six consecutive years, so his overseas income paid from overseas is exempt from individual income tax.
In 2025, David will have resided in China for 183 days. Calculated from 2019, he will have resided in China for a cumulative 183 days for six consecutive years (2019-2024) without a single departure exceeding 30 days. Therefore, in 2025, David shall pay individual income tax on his income derived from both within and outside China.
In 2026, because David had a single departure exceeding 30 days in 2025 (from February 1 to March 15, 2025), the consecutive years of his cumulative 183 days of residence in the Chinese mainland are reset and the calculation starts anew. In 2026, David’s overseas income paid from overseas is exempt from individual income tax.
Do you understand now?
