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Q: Tax Question: Rent Exemption!!!
Hypothetical Tax Scenario
My salary is 12,000RMB which includes an 800RMB housing allowance. My rent is 2300RMB a month and my landlord provides me with a fapiao. Am I allowed a tax deduction for the entire 2300RMB? Is the school responsible for reducing my salary by this amount every month if I give them the fapiao? If the school tells me no, who should I send the fapiao to and how will I get the money back each month for the portion that is being taxed although is shouldn't?
Thanks in advance for any help or advice that you may provide me.
6 years 27 weeks ago in Visa & Legalities - China
If your contract only states 800 RMB rent allowance then that’s all can be deducted for tax.
Tgiugh im sure your employer will fiddle the remaining 1500 off their tax bill...
Tami.X:
I heard that the rent allowance is taxable but the amount that you pay in rent to your landlord is deductible with a fapiao.
Expatriate concessions
Are there any concessions made for expatriates in China?
Certain benefits-in-kind provided foreign national employees individuals are exempt from tax provided that the amounts are reasonable and substantiated by official invoices/receipts and other supporting documentation. These include the following:
- rental of accommodation
- meals and laundry
- relocation
- language training (for the employee only)
- children’s education expenses in China
- Home leave travel (up to two trips a year for the employee only).
https://home.kpmg.com/xx/en/home/insights/2011/12/china-income-tax.html
If you check your salary breakdown, you will see that your rent allowance is tax exempt.
They may include other "allowances" in the tax exempt section. For example: you may see something like "teaching hours" 5400 and then a list of other stuff. This basically means they have to pay less themselves.
Since you will never lodge a tax return, it is futile to sweat it over the details. Just focus on the net amount each month.
