As a foreigner in China, do you know how much tax you pay a year in China?
Then do you know how much you can save if you choose to take advantage of the special benefits for foreigners on personal tax?
作为在中国的外国人，你知道你一年在中国要交多少税吗？那么你知道，如果你选择享受外国人在个税上的特殊优惠，又能为你省下多少钱呢？
Reindeer Station’s tax expert made a case to explain this.
灵达的税务专家做了一个案例来解释
Case Study案例
An expatriate (alias Alexander) has been working in Ningbo since January 2023 and has qualified for resident status, and is therefore subject to Individual Income Tax (IIT) on his salary and wages. The composition of his salary for the year 2023 is as follows:
Basic salary: 15,000 RMB/month;
Housing subsidy: 4,000 RMB/month;
Meal subsidy: 1,000 RMB/month;
Laundry allowance: 600 RMB/month;
International relocation expenses paid by the individual in January 2023: 6,000 RMB;
Domestic and international business travel expenses paid by the individual in May 2023: 8,500 RMB;
Family visit expenses paid by the individual in July 2023: 8,000 RMB;
Chinese language training course expenses paid by the individual in February 2023: 7,000 RMB;
International school education expenses for children paid by the individual in August 2023: 9,000 RMB.
一位外籍人士（化名Alexander）2023年1月开始在宁波工作且已符合居民身份，因此需要按照工资薪金所得缴纳个人所得税。他的2023年全年薪资构成如下：
①基本工资15000元/每月；
②住房补贴4000元/每月；
③伙食补贴1000元/每月；
④洗衣费600元/每月；
⑤2023年1月个人支付国际搬迁费用6000元。
⑥2023年5月个人支付国内外出差费用8500元；
⑦2023年7月个人支付探亲费用8000元；
⑧2023年2月个人支付中文培训班费用7000元；
⑨2023年8月个人支付子女国际学校教育费用9000元。
Analyse解析
Under the current policies in 2023, if the foreign national (alias Alexander) chooses to enjoy the special tax benefits for foreigners, the "housing subsidy of 4,000 RMB/month, meal subsidy of 1,000 RMB/month, laundry allowance of 600 RMB/month, relocation expenses of 6,000 RMB, business travel expenses of 8,500 RMB, family visit expenses of 8,000 RMB, language training expenses of 7,000 RMB, and children's education expenses of 9,000 RMB" will be deducted from his salary before calculating individual income tax. After the calculations shown in the following figure, his annual tax payment will amount to 13,900 RMB.
在2023年的现行政策下，如果外籍人士（化名Alexander）选择享受外国人在个税上的特殊优惠，那么，他的“住房补贴4000元/每月，伙食补贴1000元/每月，洗衣费600元/每月，搬迁费用6000元，出差费用8500元，探亲费用8000元，语言培训费7000元，子女教育费9000元”，这8类费用补贴在计入他的工资薪金时，将会在计算个人所得税之前扣除。在经过如下图所示的计算之后，他的年个税缴纳金额为13900元。
If the expatriate (alias Alexander) does not choose to take advantage of the special personal tax concessions available to foreigners, his annual personal tax payment would be 28,220 RMB after the calculation shown below.如果外籍人士（化名Alexander）不选择享受外国人在个税上的特殊优惠，那么，经过如下图所示的计算之后，他的年个税缴纳金额为28220元。
Therefore, it would be more favorable to Alexander to elect to take advantage of the special benefits that foreigners receive on their personal taxes.
所以，选择享受外国人在个税上的特殊优惠对Alexander更有利。
However, expatriates need to prepare sufficient documents and undergo examination by the competent tax authorities before enjoying the personal tax exemption for these 8 types of expense subsidies. The details are as follows :
不过，外籍人士在享受这8类费用补贴的个税免税政策之前，需要准备足够的材料，并经过主管税务机关审核。具体情况如下：
1."Housing allowance of 4,000 RMB/month":
It is up to the taxpayer, Alexander, to provide the competent tax authorities with valid documents (e.g., rental contract, invoice for expenses payable to an individual, etc.) when he first obtains the above subsidy and submits a tax declaration for his salary and wages, and the competent tax authorities will approve the confirmation of the tax exemption. Note: The rental contract can only be signed in Alexander's personal name, not in the name of the company.
1.“住房补贴4000元/每月”：
应由纳税人Alexander在初次取得上述补贴并进行工资薪金所得纳税申报时，向主管税务机关提供有效凭证（例如：租房合同，抬头为个人的费用发票等），由主管税务机关核准确认免税。注意：只能以Alexander个人名义签订租房合同，不能以公司名义租房。
2. "Meal allowance of 1,000 RMB/month":
Valid vouchers (e.g., invoices for expenses payable to individuals, etc.) should be provided by the taxpayer, Alexander, to the competent tax authorities for approval and confirmation of the tax exemption when he first obtains the above subsidies and makes a tax declaration of his salary and wages income.
2.“伙食补贴1000元/每月”：
应由纳税人Alexander在初次取得上述补贴并进行工资薪金所得纳税申报时，向主管税务机关提供有效凭证（例如：抬头为个人的费用发票等），由主管税务机关核准确认免税。
3."Laundry fee of 600 RMB/month":
Valid vouchers (e.g., invoices for expenses payable to individuals, etc.) should be provided by the taxpayer, Alexander, to the competent tax authorities for approval and confirmation of the tax exemption when he first obtains the above subsidies and makes a tax declaration of his salary and wages income.
3.“洗衣费600元/每月”：
应由纳税人Alexander在初次取得上述补贴并进行工资薪金所得纳税申报时，向主管税务机关提供有效凭证（例如：抬头为个人的费用发票等），由主管税务机关核准确认免税。
4."Relocation expenses of 6,000 RMB"
Valid certificates (e.g. invoices for expenses payable to individuals, relocation contracts/agreements, etc.) should be provided by the taxpayer Alexander, which will be examined and recognized by the competent tax authorities and exempted from tax in respect of the reasonable portion.
4.“搬迁费用6000元”：
应由纳税人Alexander提供有效凭证（例如：抬头为个人的费用发票，搬迁合同/协议等），由主管税务机关审核认定，就其合理的部分免税。
5."Business travel expenses of 8,500 RMB"
Copies of vouchers for transport and accommodation expenses for business trips (e.g. invoices for expenses payable to individuals, etc.) or relevant plans for business trips arranged by the enterprise should be provided by the taxpayer Alexander, and the tax exemption should be confirmed by the competent tax authorities.
5.“出差费用8500元”：
应由纳税人Alexander提供出差的交通费、住宿费凭证复印件（例如：抬头为个人的费用发票等）或企业安排出差的有关计划，由主管税务机关确认免税。
6."Family visit expenses of 8,000 RMB"
The taxpayer Alexander should provide a copy of the travelling expense voucher for visiting relatives (e.g. invoice for expenses payable to an individual, etc.), which shall be examined and approved by the competent tax authority, and tax exemption shall be granted to the portion of the voucher that is actually used for the purpose of visiting relatives by the taxpayer himself/herself and the number of times of visiting relatives per year and the standard rate of payment are reasonable.
6.“探亲费用8000元”：
应由纳税人Alexander提供探亲的交通支出凭证复印件（例如：抬头为个人的费用发票等），由主管税务机关审核，对其实际用于本人探亲，且每年探亲的次数和支付的标准合理的部分给予免税。
7."Language training expenses of 7,000 RMB"
The taxpayer Alexander should provide the expenditure vouchers and period certificates (e.g. payment records, fee invoices payable to individuals, contracts/agreements, etc.) for education in China, which should be examined and approved by the competent tax authorities, and the portion of the subsidy on language training fees obtained by the taxpayer from receiving language training in China up to a reasonable amount will be exempted from tax.
7.“语言培训费7000元”：
应由纳税人Alexander提供在中国境内接受教育的支出凭证和期限证明材料（例如：付款记录，抬头为个人的费用发票，合同/协议等），由主管税务机关审核，对其在中国境内接受语言培训取得的语言培训费补贴，在合理数额内的部分免予纳税。
8."Children's education expenses of 9,000 RMB"
The taxpayer Alexander should provide the expenditure vouchers and period supporting documents (e.g. payment records, invoices of expenses payable to individuals, contracts/agreements, etc.) for his/her children's education in China, which should be examined and approved by the competent tax authorities, and the portion of children's education subsidy obtained by his/her children's education in China, which is within a reasonable amount, shall be exempted from tax.
8.“子女教育费9000元”：
应由纳税人Alexander提供在中国境内接受教育的支出凭证和期限证明材料（例如：付款记录，抬头为个人的费用发票，合同/协议等），由主管税务机关审核，对其子女在中国境内接受教育取得的子女教育费补贴，在合理数额内的部分免予纳税。
Original Policy政策原文
The Individual Income Tax Law of the People's Republic of China and its implementing regulations and the Circular of the Ministry of Finance and the State Administration of Taxation on Certain Policy Issues Concerning Individual Income Tax (Cai Shui Zi 〔1994〕 No. 20) stipulate the scope of exemptions from individual income tax for subsidies obtained by foreign individuals, and the specific definitions and management issues for the implementation of the above provisions are clarified as follows:
1.Reasonable housing subsidies, meal subsidies and laundry fees obtained by expatriate individuals in the form of non-cash or out-of-pocket expenses are exempted from individual income tax, and the taxpayers shall provide the competent tax authorities with valid certificates of the above subsidies when they make their tax returns on salaries and wages for the month following the month when they first obtained the subsidies or when there is a change in the amount of the above subsidies or the method of their payment, so that the competent tax authorities shall approve the confirmation of exemption from tax.
2.The exemption from individual income tax of relocation income obtained by foreign individuals on an accountable basis as a result of taking up employment in China or leaving their jobs in China shall be exempted from tax on a reasonable portion of the relocation income provided by the taxpayer with valid vouchers, which shall be examined and recognized by the competent tax authorities. Monthly or regular payments made by foreign-invested enterprises and foreign enterprises to their expatriate employees in the name of relocation expenses at their organizations and establishments in China shall be counted as income from wages and salaries for the purpose of individual income tax.
3.For the exemption of individual income tax on domestic and foreign business trip subsidies obtained by foreign individuals according to reasonable standards, the taxpayers shall provide vouchers (photocopies) of the transportation and accommodation fees for business trips or the relevant plans of the enterprises for arranging business trips, and the tax exemption shall be confirmed by the tax authorities competent for such trips.
4.The exemption of individual income tax on family visit fees obtained by expatriate individuals shall be granted by the taxpayer who shall provide the transportation expenditure vouchers (photocopies) for family visits, which shall be examined and approved by the competent tax authorities, and shall be exempted from tax if they are actually used for visiting their relatives and the number of times of family visits and the standard of payment are reasonable each year.
5.Individual income tax exemption for language training fees and subsidies for children's education fees obtained by foreign individuals shall be provided by the taxpayers with vouchers of the expenditure on the abovementioned education in China and documents proving the duration of such education, and the competent tax authorities shall examine and exempt from tax the portion of the language training fees and subsidies for children's education fees obtained by the taxpayers from receiving language training and their children's education in China that is within a reasonable amount.
《中华人民共和国个人所得税法》及其实施条例和《财政部、国家税务总局关于个人所得税若干政策问题的通知》（财税字〔1994〕20号）就外籍个人取得有关补贴规定了免征个人所得税的范围，现就执行上述规定的具体界定及管理问题明确如下：
一、对外籍个人以非现金形式或实报实销形式取得的合理的住房补贴、伙食补贴和洗衣费免征个人所得税，应由纳税人在初次取得上述补贴或上述补贴数额、支付方式发生变化的月份的次月进行工资薪金所得纳税申报时，向主管税务机关提供上述补贴的有效凭证，由主管税务机关核准确认免税。
二、对外籍个人因到中国任职或离职，以实报实销形式取得的搬迁收入免征个人所得税，应由纳税人提供有效凭证，由主管税务机关审核认定，就其合理的部分免税。外商投资企业和外国企业在中国境内的机构、场所，以搬迁费名义每月或定期向其外籍雇员支付的费用，应计入工资薪金所得征收个人所得税。
三、对外籍个人按合理标准取得的境内、外出差补贴免征个人所得税，应由纳税人提供出差的交通费、住宿费凭证（复印件）或企业安排出差的有关计划，由主管税务机关确认免税。
四、对外籍个人取得的探亲费免征个人所得税，应由纳税人提供探亲的交通支出凭证（复印件），由主管税务机关审核，对其实际用于本人探亲，且每年探亲的次数和支付的标准合理的部分给予免税。
五、对外籍个人取得的语言培训费和子女教育费补贴免征个人所得税，应由纳税人提供在中国境内接受上述教育的支出凭证和期限证明材料，由主管税务机关审核，对其在中国境内接受语言培训以及子女在中国境内接受教育取得的语言培训费和子女教育费补贴，且在合理数额内的部分免予纳税。
Author | Alex
作者 | Alex
