Events
The New China Individual Income Tax (IIT) Law 2019
Tuesday, December 04 2018, 09:00 - 17:00
Programme Objective

The Standing Committee of the National People’s Congress of China amended the Individual Income Tax (IIT) Law on 31 August 2018. The new law will be effective from 1 January 2019. How will the new law affect talent from Singapore working in China? What are the common problems relating to secondment of staff to China?

In this highly practical workshop, the trainer will explain the important issues arising from China’s new IIT law and will demonstrate best practice approaches in overcoming these challenges, through the use of practical examples.

At the end of this workshop, you will:

  • Be updated and compliant to China’s new IIT Law
  • Find out the effect of the new law on talent from Singapore working in China
  • Learn the common practical challenges faced in the secondment of staff from Singapore to China
  • Benefit from practical lessons and case examples in addressing the critical issues arising from China’s latest IIT law

Programme Outline

Issue 1: Worldwide Tax

According to Article 1 of the Law, an individual without China domicile spending 183 days in a calendar year becomes a China tax resident and will be subject to China IIT on worldwide income

  • Does it mean that tax break is useless to avoid worldwide tax?
  • Is there any tax exemption for tax residents because of period of stay?
  • Is the Chinese employer liable to withhold IIT on salaries paid outside China? If yes, what is the penalty on non-withholding of offshore salaries?
  • What is the penalty on non-declaration of offshore income? Will this be a criminal offence?

Issue 2: Tax Exempt Allowances

Under the new Law, foreigners can no longer enjoy the previous eight tax exempt allowances. This is replaced by six specific additional deductions for all individuals, namely: children education, continued education, major illness medical expenses, mortgage interest, rental expenses and support of the elderly.

  • How will this affect the employment contracts of expatriates which state that invoices (FaPiaos) should be provided to HR in order to get tax exemption?
  • Which types of allowances are taxable under the new IIT Law?

Issue 3: Overseas Salaries

It is common for seconded staff to receive salaries from overseas employer

  • If the staff is not subject to China worldwide tax, will the salary paid in Singapore be taxable in China? Is it “offshore” income?

Issue 4 : Recharge of Salaries Paid Overseas to Chinese Subsidiary

  • Singapore headquarters charged back the salaries paid in overseas to the Chinese subsidiary. IIT has been fully paid
  • What are the documents required so as to remit the recharged salaries to overseas?
  • Which type of secondment charges cannot be remitted?

Issue 5: Tax Withholding and Annual Filing

  • The new IIT Law introduces the mechanism of a combination of provisional withholding by employer and annual filing (with tax refund, if any)
  • What are the responsibilities of employers?
  • What are the responsibilities of employees?

Issue 6: Salaries vs Service fee

  • IIT for service fee is 20% lower than IIT for salaries
  • What are the differences between service fee and salaries from tax and social security perspectives?
  • Is it possible to restructure and turn the general manager into a consultant?

Issue 7: Tax Exemption under Treaty

  • Will the new IIT Law affect the exemption under tax treaty?
  • How can foreigners working in China enjoy the exemption under tax treaty? 
  • What are the procedures to apply for treaty exemption?

Issue 8: Dual Contracts

  • Can dual contracts help in reducing IIT?
  • Which types of dual-contract arrangement can work and which types cannot?

Issue 9: Anti-avoidance

  • The new IIT Law introduces anti-avoidance article. How will it affect foreigners working in China?

Issue 10: Other Issues

  • Employees received stock option of the overseas listed company. What are the tax and non-tax issues which should be considered? After paying IIT, can the amount charged-back to Chinese subsidiary be remitted overseas?
  • The Singapore employee is going to retire and wants to sell the apartment in China. Can the proceeds be remitted overseas?

 

Administrative Details
 

Date:

4 Dec 2018

Time:

9:00am – 5:00pm

Venue:

Hotel Venue to be Advised


Please click here for more details.
Please click This e-mail address is being protected from spambots. You need JavaScript enabled to view it to register.
Accredited tax professionals enjoy subscribers' rate (i.e. 10% discount)!

Back