The amendment of PRC Individual Income Tax Law ["PRC IIT Law"] was recently released and took effect from 1st September, 2011
Major changes are :
1. Monthly Standard Deduction for salaries and wages increased from RMB2,000 to RMB3,500 [remain unchanged for non-residents];
2. IIT rates on salaries and wages changed from 9 brackets to 7 brackets and 5% reduced to 3%, analysis of IIT rates :
- Pre-amendment
|
Tax bracket |
Monthly taxable income |
Tax rate (%) |
Quick deduction |
|
1 |
500 or less |
5 |
0 |
|
2 |
In excess of 500 to 2,000 |
10 |
25 |
|
3 |
In excess of 2,000 to 5,000 |
15 |
125 |
|
4 |
In excess of 5,000 to 20,000 |
20 |
375 |
|
5 |
In excess of 20,000 to 40,000 |
25 |
1,375 |
|
6 |
In excess of 40,000 to 60,000 |
30 |
3,375 |
|
7 |
In excess of 60,000 to 80,000 |
35 |
6,375 |
|
8 |
In excess of 80,000 to 100,000 |
40 |
10,375 |
|
9 |
In excess of 100,000 |
45 |
15,375 |
- Post-amendment
|
Tax bracket |
Monthly taxable income |
Tax rate (%) |
Quick deduction |
|
1 |
1,500 or less |
3 |
0 |
|
2 |
In excess of 1,500 to 4,500 |
10 |
105 |
|
3 |
In excess of 4,500 to 9,000 |
20 |
555 |
|
4 |
In excess of 9,000 to 35,000 |
25 |
1,005 |
|
5 |
In excess of 35,000 to 55,000 |
30 |
2,755 |
|
6 |
In excess of 55,000 to 80,000 |
35 |
5,505 |
|
7 |
In excess of 80,000 |
45 |
13,505 |
3. Monthly IIT filing deadline is postponed from 7th to 15th in the following month; and
4. IIT rates for individual business changed.
|
Tax |
Annual taxable income |
Tax rate |
|
1 |
15,000 or less |
5 |
|
2 |
In excess of 15,000 to 30,000 |
10 |
|
3 |
In excess of 30,000 to 60,000 |
20 |
|
4 |
In excess of 60,000 to 100,000 |
30 |
|
5 |
In excess of 100,000 |
35 |