USA / China Tax Treaty
USA / China Tax Treaty
Got a question about taxes in China for USA teachers. I know other countries have a tax treaty with the USA, so you don't have to pay local taxes for a set number of years. I was wondering if China has something similar. I see on the IRS website (http://www.irs.gov/pub/irs-trty/china.pdf article 19) it looks like it, but I was wondering if anyone has actual experience trying to use it. Much appreciated!
Re: USA / China Tax Treaty
We left China 2 years ago...my final year the Chinese government did institute a tax that foreigners did have to pay. It's a tax where you do get the money back when you leave China. Our school had worked out a deal where the collection and return were done through the school so we didn't have to work directly with the government to get the money back. At our income level, it was not a huge burden, but it was noticeable. If you are looking at working for school in China you may want to ask about that tax and how the school handles it.
For state/federal income tax, you don't pay it in China and you don't pay it in the US if you are under the exclusion.
For state/federal income tax, you don't pay it in China and you don't pay it in the US if you are under the exclusion.
Re: USA / China Tax Treaty
We live in China and our school definitely pays a pretty hefty income tax on our salary and we won't get it back.
Response
Yes and No
Yes there is a tax treaty, and if your at an elite tier IS you can probably use it. There is a new tax thats not covered by the treaty, compared to elite IS coin though its nothing.
No, most ISs at lower and mid tiers will implement the tax treaty, because the taxes will ultimately fall on the IS to pay (after you are gone).
Yes there is a tax treaty, and if your at an elite tier IS you can probably use it. There is a new tax thats not covered by the treaty, compared to elite IS coin though its nothing.
No, most ISs at lower and mid tiers will implement the tax treaty, because the taxes will ultimately fall on the IS to pay (after you are gone).
Re: USA / China Tax Treaty
After reading the posts, I did remember that our school did, in fact, pay Chinese taxes on our behalf so it didn't come out of our salary...except for the recently issues social security type tax which we did have to pay out of our pockets. I think Psy Guy's right...the big schools are more likely to be the ones that cover it for you, so you should ask carefully. We're moving to a country where we'll have to pay a hefty national tax and it will definitely force us to be much more careful about our spending than we've had to be in the past!
Re: USA / China Tax Treaty
My school pays for my taxes on my behalf in China... but I'm not sure how that would work for paying taxes back in the USA...