Under the first draft amendments to IIT Laws in China, resident taxpayers will be allowed to deduct certain additional items from their comprehensive income.
These additional deductible items are categorized as ‘additional itemized deductions for specific expenditures’, which include:
- Education expenses for children;
- Expenses for further self-education;
- The expenses for supporting elderly family members;
- Health care costs for serious illness;
- Housing loan interest; and
- Housing rent.
For non-resident taxpayers, the RMB 5,000 (US$734) per month standard deduction will also apply to them and will replace the current RMB 4,800 (US$705) per month standard deduction.
The above changes are based on the first draft amendments and may be subject to change. The second draft of amendments to the IIT Law in China is currently being reviewed.
For more information or advice from a taxation expert, contact us.
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