On the 22nd of June 2019, the financial and tax authority of Guangdong province announced the Implementing Notice (Guangdong cai shui # 3 2019) of the IIT incentive policy in the Greater Bay Area.
According to the Notice, for overseas high-end talents and talents in demand who work in the Greater Bay Area, the amount of individual income tax（IIT）paid in the nine cities of the Pearl River Delta in excess of 15% of their taxable income shall be granted as a financial subsidy by the local government. Â
The “amount of IIT paid” here refers to the following amounts of IIT paid in accordance with the provisions of the Individual Income Tax Law of PRC: wages, salaries, remuneration for services, contribution remuneration, royalties, income from business operations, and subsidized income from selected talent projects or talent projects.
The above mentioned financial subsidy is distributed once a year on the basis of individual income items, in the form of a sub-calculation and a combined subsidy.
Since January 1st 2019, the new IIT law of PRC become effective. On March 15th, 2019, the Ministry of Finance and the General Administration of Taxation issued the Notice on Individual Income Tax Incentives for the Greater Bay Area (Cai Shui (2019) No. 31), which clearly implements the subsidy policy for the IIT burden of overseas talents in Mainland and Hong Kong. Subsidies are granted to overseas (including Hong Kong, Macao and Taiwan) high-end and in demand talents working in the Greater Bay Area, and the subsidies themselves are exempt from IIT.
This Notice issued on the 22nd of June, 2019 gives out more detailed provisions of the IIT incentives policy that was announced on March 15th, 2019.
Who is qualified for the tax difference subsidy?
1. Permanent residents of Hong Kong and Macao, Hong Kong residents who have obtained the Hong Kong Entry Scheme (excellent talents, professionals and entrepreneurs), residents of Taiwan, foreign nationals, or returning students and overseas Chinese who have obtained permanent residence abroad.
2. Those that work in the nine cities in the Pearl River Delta and pay IIT here in accordance with the law.
3. Comply with laws and regulations, scientific research ethics and scientific research integrity.
At the same time, they shall meet one of the following conditions:
1. Selected into National, provincial or municipal major talent projects, or obtained the Guangdong Province “Guangdong Excellent Talent Card”, or holding a foreign work permit (class A) or foreign high-end talent confirmation letter, as well as the state, province or city other foreign high-level talent identification;
2. Scientific research and technical team members in hospitals and other related institutions, technical backbone and excellent management personnel in provincial key development industries, as well as other special expertise identified by the Pearl River Delta nine cities identification.
Related link:
Notice Guangdong cai shui # 3 2019
