Q1: How can I pay my individual income tax (IIT) in China?
A: If you are working in China (more than 183 days a year), you have to pay individual income tax based on your revenue, no matter if earned within or outside of China.
Usually, your employer will be the withholding agent, meaning they will deduct the IIT from your salary and pay it to the tax authority on your behalf. You may also check our previous post: Individual Income Tax in China – How to Pay in 2019?
Related provisions in Law of the People’s Republic of China on Individual Income Tax:
Article 1 Individuals who have domiciles within China, or who have no domicile within China but have resided in China for accumulative 183 days or more in one tax year shall be resident individuals. Resident individuals shall pay individual income tax on their income gained within or outside China.”
Article 9 With respect to individual income tax, the income earner shall be the taxpayer, and the paying entity or individual shall be the withholding agent.
Q2：How can I know my employer has paid my IIT properly?
A：You can ask the local tax bureau (in the same district of your employer) to print out your tax statement by showing them your original passport.
Q3: What consequences if my IIT has not been paid properly?
A: As explained, it’s your employer’s duty to withhold your IIT and they have to be responsible for that. So even if it turns out that your IIT has not been paid properly, it’s not your fault and hence, no consequences for you.
Q4: Can my IIT be refunded?
A：If it’s found that you have paid more tax when final settlement is handled, you can file a tax return. However，IIT is not refundable, while the amount in your personal pension account could be refunded if you decide to leave China. Don’t confuse IIT with social insurance.
Related provision in Law of the People’s Republic of China on Individual Income Tax:
Article 11 Individual income tax on the comprehensive income gained by a resident individual shall be calculated on an annual basis; the withholding agent, if any, shall withhold and remit tax on monthly basis and on per-payment basis; final settlement, if required, shall be handled between March 1 and June 30 of the year following the receipt of the income.
