Six-year rule · 183-day residence · Tax flagship · Personal FX quota · WFOE dividends · CRS / FATCA.
“Worldwide” means foreign-source items enter the China IIT analysis once you are a domiciled resident or a non-domiciled resident whose six-year exemption has expired. Typical bag: offshore rent, dividends, interest, and many foreign-asset gains. Pay for work physically performed in China is often still China-source even if the payer is overseas — do not hide it behind the exemption. Foreign tax credits and treaties reduce double tax if you keep certificates. CRS is visibility, not optional disclosure. This is not the USD 50,000 quota and not WFOE profit remittance.
At a glance
| Question | Short answer |
|---|---|
| Who is in? | Domiciled, or non-domiciled in a post-exemption year. |
| Offshore payroll? | China workdays are often still China-source. |
| CRS? | Assume reportable accounts are visible. |
| Double tax? | FTC / DTA — keep certificates. |
| 50k quota? | Different page. |
Scope and legal framework
IIT Law — scope of tax. Residents are in principle taxed on income from inside and outside China. The six-year exemption is a carve-out for non-domiciled residents’ foreign-source income paid and borne abroad — not a carve-out for China workdays.
Sourcing themes. Employment income generally follows where the work is done. Dividends and interest generally follow the payer. Immovable-property income follows the location of the property. Confirm the SAT sourcing rules for the line item — this is orientation.
Foreign tax credit / information exchange. China allows a foreign-tax credit within limits. CRS (and FATCA for US persons) means foreign financial accounts are often already in an information pipe. Non-filing is the failure mode.
Practical workflow
- Confirm you are actually in a worldwide year (six-year page).
- List foreign accounts, rentals, grants, equity plans.
- Label each line China-source vs foreign-source.
- Collect foreign tax paid proofs before you need the credit.
Common mistakes
- Calling offshore payroll “foreign-source” while sitting in Shanghai.
- Assuming SAT cannot see a Singapore broker.
- Moving rent on relatives’ personal FX quotas.
Action checklist
- Six-year status written down.
- One spreadsheet of foreign items.
- Source label on every line.
- FTC folder started.
- No quota-splitting plan.
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