Chinese tax rate it makes alot of sense. . . Theyve been doing this the longest or maybe japan?
Individual - Taxes on personal income
Last reviewed - 02 July 2025
Residents are generally subject to China individual income tax (IIT) on their worldwide income. Non-residents are generally taxed in China on their China-source income only (see the Residence section for more information).
An individual is taxed in China on one's income by category. China's IIT law groups personal income into 9 categories.
The 9 categories of income are:
Employment income (i.e. wages and salaries).
Remuneration for labour services.
Author's remuneration.
Royalties.
Business income.
Interest, dividends, and profit distribution.
Rental income.
Income from transfer of property.
Incidental income.
Each income category has its own tax rate(s), allowable deductions, etc.
For residents, employment income, remuneration for labour services, author’s remuneration, and royalties are combined as 'comprehensive income' for aggregate tax calculation purpose on an annual basis. Income from the other categories is taxed separately by category on a monthly or transaction basis.
For non-residents, income from each of the 9 categories is taxed separately on a monthly or transaction basis.
Table 1 Personal income tax rates
Comprehensive income tax rates
For residents, calculation of IIT on annual comprehensive income is based on progressive tax rates (see Table I below) using the following formula:
(Annual taxable income x Tax rate) - Quick deduction
Table I
Annual taxable income (CNY*) (1) Tax rate (%) Quick deduction (CNY)
0 to 36,000 3 0
Over 36,000 to 144,000 10 2,520
Over 144,000 to 300,000 20 16,920
Over 300,000 to 420,000 25 31,920
Over 420,000 to 660,000 30 52,920
Over 660,000 to 960,000 35 85,920
Over 960,000 45 181,920
* renminbi
Notes
Annual taxable income after deducting the standard basic deduction, specific deductions, specific additional deductions, and other allowable deductions (see the Deductions section for more information).
For non-residents, IIT on employment income, remuneration for labour services, author’s remuneration, and royalties is calculated by each category on a monthly or transaction basis at the below progressive tax rates (see Table II below).
Table 2: Monthly taxable income (CNY) Tax rate (%) Quick deduction (CNY)
0 to 3,000 3% 0
Over 3,000 to 12,000 10% 210
Over 12,000 to 25,000 20% 1,410
Over 25,000 to 35,000 25% 2,660
Over 35,000 to 55,000 30% 4,410
Over 55,000 to 80,000 35% 7,160
Over 80,000 45% 15,160
Table 3 Business income tax rates
Income earned by individuals from privately-owned businesses, sole proprietorship enterprises, or partnerships is generally subject to IIT at progressive rates from 5% to 35%, as follows:
Annual taxable income (CNY) Tax rate (%)
0 to 30,000 5%
Over 30,000 to 90,000 10%
Over 90,000 to 300,000 20%
Over 300,000 to 500,000 30%
Over 500,000 35%
Local income taxes
There are no local taxes on personal income in China.
Next up japan!
Last reviewed - 02 July 2025
Residents are generally subject to China individual income tax (IIT) on their worldwide income. Non-residents are generally taxed in China on their China-source income only (see the Residence section for more information).
An individual is taxed in China on one's income by category. China's IIT law groups personal income into 9 categories.
The 9 categories of income are:
Employment income (i.e. wages and salaries).
Remuneration for labour services.
Author's remuneration.
Royalties.
Business income.
Interest, dividends, and profit distribution.
Rental income.
Income from transfer of property.
Incidental income.
Each income category has its own tax rate(s), allowable deductions, etc.
For residents, employment income, remuneration for labour services, author’s remuneration, and royalties are combined as 'comprehensive income' for aggregate tax calculation purpose on an annual basis. Income from the other categories is taxed separately by category on a monthly or transaction basis.
For non-residents, income from each of the 9 categories is taxed separately on a monthly or transaction basis.
Table 1 Personal income tax rates
Comprehensive income tax rates
For residents, calculation of IIT on annual comprehensive income is based on progressive tax rates (see Table I below) using the following formula:
(Annual taxable income x Tax rate) - Quick deduction
Table I
Annual taxable income (CNY*) (1) Tax rate (%) Quick deduction (CNY)
0 to 36,000 3 0
Over 36,000 to 144,000 10 2,520
Over 144,000 to 300,000 20 16,920
Over 300,000 to 420,000 25 31,920
Over 420,000 to 660,000 30 52,920
Over 660,000 to 960,000 35 85,920
Over 960,000 45 181,920
* renminbi
Notes
Annual taxable income after deducting the standard basic deduction, specific deductions, specific additional deductions, and other allowable deductions (see the Deductions section for more information).
For non-residents, IIT on employment income, remuneration for labour services, author’s remuneration, and royalties is calculated by each category on a monthly or transaction basis at the below progressive tax rates (see Table II below).
Table 2: Monthly taxable income (CNY) Tax rate (%) Quick deduction (CNY)
0 to 3,000 3% 0
Over 3,000 to 12,000 10% 210
Over 12,000 to 25,000 20% 1,410
Over 25,000 to 35,000 25% 2,660
Over 35,000 to 55,000 30% 4,410
Over 55,000 to 80,000 35% 7,160
Over 80,000 45% 15,160
Table 3 Business income tax rates
Income earned by individuals from privately-owned businesses, sole proprietorship enterprises, or partnerships is generally subject to IIT at progressive rates from 5% to 35%, as follows:
Annual taxable income (CNY) Tax rate (%)
0 to 30,000 5%
Over 30,000 to 90,000 10%
Over 90,000 to 300,000 20%
Over 300,000 to 500,000 30%
Over 500,000 35%
Local income taxes
There are no local taxes on personal income in China.
Next up japan!
