The IIT Implementing Regulations were revised by State Council Order No. 707, effective 1 January 2019. This article selectively translates relevant Chinese provisions for cross-border employers and payroll teams.
Official Chinese original: 中华人民共和国个人所得税法实施条例（国务院令第707号）. Source reviewed: 26 October 2026. Document type: selected independent translation, not an official complete English version.
Domicile and source of income — Articles 2 and 3
Selected provision, independently translated: For IIT purposes, having a domicile in China includes habitual residence there due to household registration, family or economic connections. Unless otherwise provided by the competent authorities, compensation for duties or services performed in China is income sourced in China irrespective of where payment is made.
Employer application: Foreign-funded payroll or overseas payment does not by itself make China-performed employment income foreign-sourced.
The six-year qualification — Article 4
Selected provision, independently translated: For a person without a domicile in China whose years with at least 183 days in China run consecutively for fewer than six years, qualifying foreign-source income paid by an overseas organization or individual may be exempt after the required filing with the competent tax authority. A departure exceeding 30 days in any qualifying year resets the count of consecutive years.
Employer application: Application depends on the precise statutory conditions, tax filings and residence records; do not present this as a blanket six-year tax exemption.
Short stays and foreign-paid income — Article 5
Selected provision, independently translated: Where an individual without China domicile stays in China for no more than 90 days in a tax year, China-source income paid by a foreign employer and not borne by that employer’s establishment or place of business in China may qualify for exemption.
Employer application: Employer-borne costs and treaty rules can change the practical result; specialist payroll review is required.
Compensation categories — Article 6
Selected provision, independently translated: Employment-related salaries, pay increases, bonuses, allowances, subsidies and other benefits obtained because of a job are within the specified scope of wages and salaries. Other independent service income is addressed separately.
Employer application: Companies should assess economic substance and document remuneration components.
Permitted employee deductions — Article 13
Selected provision, independently translated: Other lawfully specified deductions include qualifying individual contributions to approved enterprise and occupational annuities and certain qualifying insurance arrangements. Deduction categories and limits follow the conditions in tax rules.
Employer application: This is a selected legal translation, not a full list of present-day tax preferential policies.
Primary source and related material
Read the original Chinese legal text. Related resources: China Individual Income Tax Law · Expat payroll and IIT compliance.
This page is a non-certified translation of selected Chinese legal provisions for general information. Consult competent advisers about current rules, subsequent notices and the facts of an individual case.
