Expat Employee Applications
Chinese taxation has its own rules that are more or less contingent on time spent in China, sourced income location, and taxpayer status, as well as applicable double taxation agreements (DTAs) in place. Specifically, foreign individuals seeking to apply for the Chinese tax residency certificate must have held domicile in China for a minimum of one year. More can be found here on the various taxation parameters.
It should be clear that issuance of this certificate is not an automatic method of avoiding taxation requirements in foreign individuals’ home jurisdiction. Foreign employees should first communicate with their respective tax authorities in their home countries on the status and adequacy of the Certificate of Tax Residency.
A set of required documents is to be prepared for the local tax bureau. They include:
- Application form
- Copy and original passport
- Copy of tax registration certificate of employer
- The original PRC individual income tax and other tax payment receipts (if no tax payment is provided a written explanation letter is required)
- Supporting documents for PRC residence days
- Other supporting documents required by the tax authority in charge
The requirements for foreign national individuals do not exist for subsidiaries. The following documents need to be submitted to the local tax bureau:
- Application form
- Copy and the original tax registration certificate
- Tax clearance certificate in the current fiscal year (if no tax payment is provided, a written explanation letter is required)
A few specifics to keep in mind are that the application procedure might be different in practice, and the time required for issuing the certificate can vary by region and tax authority. For example, in Shanghai, tax authorities can issue the certificate in five business days, while in Shandong province the process can take around 20 working days.
Since its establishment in 1992, Dezan Shira & Associates has been guiding American investors through Asia’s complex regulatory environment and assisting them with all aspects of legal, accounting, tax, internal control, HR, payroll and audit matters. As a full-service consultancy with operational offices across China, Hong Kong, India and emerging ASEAN, including liaison offices in Boston and Waltham specifically established to support our American clients, we are your reliable partner for business expansion in Asia and beyond. For inquiries, please email us at [email protected]. For further information about our firm and how we can support American investors in Asia, please visit our North American Desk.