Individual income tax planning and risk of expatriates working in China 高层管理者与外籍/外派人士个人所得税筹划——上海场/北京场
Individual income tax planning and risk of expatriates working in China
培训时间：Feb 28, 2018 Shanghai 2月28日上海场；Mar 2, 2018 Beijing 3月1日上海场
Language：SH English英文 / BJ Chinese中文
China starts the Automatic Exchange of Financial Information (AEOI) in 2018. How it will affect expatriates working in China? Will your overseas incomes be taxable in China? Are you aware that you can be a China tax resident without a Chinese identity card?
The seminar value
The latest trends in IIT enforcement on expatriates working in China
The basic principles of IIT for expatriates
Most concerned and difficult issues of IIT planning for senior management and expatriates in different status
10 vivid practical cases analysis to provide best solutions for IIT Planning
Open discussion mode and inspiring interaction
Who should attend?
Senior Management; Expatriates and Second Staff; HRD and HRM; Tax Director and Manager
公司高层管理人员; 派遣或借调的员工（本土与非本土）; 人力资源总监及经理; 税务总监及经理
In this seminar, we will discuss the following issues:
1.AEOI (Common Reporting Standard (CRS)) – how will it affect expatriates working in China? What are the differences if you have family in home country? Which types of information will be transmitted to China State Administration of Taxation? Will information of jointly owned bank accounts be transmitted?
2. How will the Golden Tax 3 system affects expatriates’ IIT reporting in China? What are the latest trends in IIT enforcement on expatriates working in China?
3. Under what circumstances an expatriate will be a China tax resident? What is the 5-year rule for China worldwide tax? What is “tax break”? If you have already stayed in China over 5-year period, what can you do?
4. If your company has not withheld IIT correctly for the employees, what are the remedies to reduce the penalty / late payment surcharges?
5. Which types of short-term assignment to China can be exempt from IIT?
6. Can a legal representative of a wholly foreign owned enterprise not getting paid in China?
7. Why the chief representative of a rep office has to pay IIT for even one-day of stay in China?
8. What are the IIT implications on stock option plan on expatriates? How to allocate onshore and offshore income? Why HR should reconsider the foreign exchange registration of stock option for expatriates? What are the China tax issues on stock option? Will an expatriate be taxable in China after leaving China?
9. Can split salary payments inside and outside China reduce IIT?
10. Will an expatriate be subject to China IIT for director’s fee received?
11. What are the pitfalls of ideas such as “multiple payments of salaries”, “non-cash benefits”, “service fees”, annual bonus etc.?
12. What should be noted in getting tax exempt allowances, e.g. meal allowance, housing allowance etc.?
13. Can expatriates get paid in foreign currency? Can an expatriate remit funds out from China after selling off his/her property?
14. What are the possible IIT planning opportunities for expatriates under the current tax environment? How to manage the risk of companies?
1. AEOI (金融账户涉税信息自动交换)如何影响在中国境内工作的外籍人士？在原居地有家庭会否影响税务处理？哪些境外金融机构账户数据会交换到国家税务总局？联名银行账户的数据会否被交换？
3. 外籍人士在哪些情况下会成为中国税收居民? 何谓「五年」? 何谓「tax break」? 如果你已在中国停留超过五年，可以怎办？
8. 外籍人士取得股票期权如何划分境内境外收入？为何HR在替外籍人士办股票期权的外汇登记时要三思? 外籍人员离境后才行权，要交个人所得税吗？
We will explain these points via the cases below:
Case 1 – Different people, different concerns
XYZ Group has the following types of expatriates working in China:
Type 1: Frequent travelers – number of working days in China is less than 183 in any 12-month period (183-day threshold)
Type 2: Frequent travelers – number of working days in China is over 183-day threshold
Type 3: Full-time work in Shanghai and travel to Hong Kong home every weekend
Type 4: Full-time stationer in China with family in China
1. What are the tax concerns of these four types of people?
2. Can split contract work to reduce tax?
3. What are the common tax planning ideas for different types of people?
4. How to arrange for tax exempt allowances? An expatriate would like to claim meal allowance of RMB20,000 per month. Is this reasonable?
案例1 – 针对不同人群的区别考虑
类型1：经常出差者 – 在中国工作的天数在任何连续的12个月内都小于183天（183天门槛）
类型2：经常出差者 – 在中国工作的天数超过183天
Case 2 – Tax resident and PRC worldwide tax
Mr. Smith, a Canadian citizen, has been working in XYZ (China) Co Ltd as the CFO since 2010. He has bought a service apartment in China and got married with a Chinese national. He worried that he would become a tax resident of China and hence, subject to worldwide tax in China.
1. Under what circumstances will a foreigner become a China tax resident?
2. Will marriage and own an apartment make situation worse?
3. What is meant by worldwide tax in China?
4. How to avoid being a China tax resident?
5. What should Mr. Smith and his employer have done in the past? What are the remedies now?
Case 3 – Expatriates staying in China for less than 183 days but need to pay China IIT
The overseas parent company charged its Beijing subsidiary technical service fees. Each of the project team member stayed in China for less than 183 days but they were required to pay China IIT and totaled RMB17 million and late payment surcharge of RMB5 million. In another similar case, the IIT totaled RMB30 million while the enterprise income tax on the permanent establishment was RMB5 million
Why they were taxable in China? What are the technical grounds?
What are the tax and employment issues which management should consider when sending staff to work in China on project basis?
How to reduce the IIT risks?
案例3 – 外籍个人在中国少于183天但要缴纳中国个税
Case 4 – Fraudulent invoices and penalty
A multinational company’s China subsidiary appointed three of the Big 4 to handle its China IIT matters. During a self-review, the China Co paid back IIT of RMB5 million for expatriates’ home leave allowances of family members and hotel charges, and housing allowances etc. for overseas returns working in China. During the tax audit, the China Co paid back IIT of another RMB4.5 million and a penalty of RMB4.5 million because of fraudulent invoices on housing allowances.
1. Who are entitled to tax exemption on various allowances? What are the tax exempt allowances for expatriates?
2. What are the measures management can consider to reduce the risks?
What are the penalty on tax errors?
Case 5 – Who should bear the IIT on salaries paid overseas
The legal representative of a Guangzhou wholly foreign owned enterprise (WFOE) sued its employer on paying IIT on his overseas salaries to the Guangzhou Local Tax Bureau (LTB) during a tax audit. The WFOE required him to pay back the tax. He further sued the Guangzhou LTB on collecting IIT on his overseas salary since he has paid US tax already.
1. Does it mean “double-taxed” when the China tax authorities imposed IIT on overseas salary? Why he should pay IIT in China even though he has paid US tax?
2. Why he failed in both court cases?
3. Who should bear the tax and who should bear the penalty of non-compliance?
4. What should management consider before sending senior personnel to China?
案例5 – 谁该负担境外收入相关的个人所得税
Case 6 – Salaries and investment income
Mr. Smith has selected to get 100% of salaries paid in Renminbi (RMB) in China. While he bought his first apartment with cash remitted from overseas, he has used the RMB to buy two other properties in China. His wife has invested in GEM Board and made a profit of a few millions. Recently, the couple decided to dispose all the properties in China and migrate back to Canada for retirement.
1. Is it possible for Mr. Smith to remit the proceeds and cash out from China legitimately?
2. What are the taxes he needs to pay?
案例6 – 薪金及投资收益
Case 7 – Back-filing taxes
During the annual audit, the auditors of ABC (China) Co Ltd told management that the Company has not properly withheld IIT for their staff. Hence, the following amounts have been provided in the accounts:
IIT of the staff
Late payment surcharge (interest) of 0.05% per day
Penalty of 300% on the amount of taxes underpaid
Management has decided to back-file the taxes and they have the following questions:
1. How to reduce the burden on back-filing?
2. Is it possible to reduce or waive the late payment surcharge and penalty?
3. Before the back-filing, is it possible not to provide the late payment surcharge and penalty in the accounts?
Case 8 – Stock option
ABC Group, a listed company in Hong Kong, is considering the implementation of a stock option scheme to its employees in China, including expatriates and PRC local employees.
1. What are the taxation rules of stock option and how to split onshore and offshore income?
2. What are the possible tax planning ideas and what are the potential issues to be considered?
3. Should an expatriate pay China tax on exercising stock option after transfer back to home country?
4. What are the tax and non-tax implications of foreign exchange registration for stock option?
案例8 – 股票期权
Case 9 – Bonus
At a seminar, the speaker mentioned that bonus can be paid by installments and taxed as a lump sum.
Why this arrangement does not work?
Case 10 – Director
Mr Ma is the director of both Beijing subsidiary and Hong Kong listed company. He has received director’s fees from both companies. He is an US citizen and stayed in China for over 10 years.
1. Why he needs to pay Hong Kong tax, China tax and US tax on the director’s fee received from Hong Kong company?
2. Will the tax position be different if he has stayed in China for less than 5 years?
About the Speaker
Miss Bolivia Cheung, Founder and Director, BC Training Co Ltd (FCCA and FCPA)
Bolivia has over 20 years of experience on China tax and business advisory. She joined KPMG in 1996, promoted to partnership in 8 years and retired from a tax partner in 2011 after working in KPMG for 15 years. She frees up herself for training, education, free-lance consultancy projects and charitable activities, and completed the MA in Practical Philosophy, her second master degree. Bolivia has stationed in Guangzhou and Shanghai for over 8 years which means a lot of practical experiences in dealing with problems and issues of taxpayers.
Bolivia is the member of ACCA China Expert Forum, Member of Working Party on Seminars of Accountancy Training Board of Hong Kong Vocational Training Council, Member of the Customer Liaison Group for SMEs of the Trade and Industry Department of the Hong Kong Special Administrative Region, part-time lecturer on China Tax at the University of Macau , HKU SPACE and Xiamen National Accounting Institute; and has been the Steering Team of ACCA Southern China from 2004 to 2017 and the Vice-chairperson of the Board of Directors of Sowers Action (a charitable organization in Hong Kong) from 2012 to 2016.
张少云(FCCA & FCPA), 必思培训有限公司创办人及董事
Hotel：Intercontinental Hotel 上海锦江汤臣洲际大酒店
Fee： RMB 3980（ Including Training notes/ tea Break/ Lunch）