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TimBYD Original post #1
Hey everyone, I’ve got some local tax questions that I’m hoping some of you can help answer. I am in the process of getting a Z work visa and going legit and need to figure out the tax situation. My company is small and doesn’t have a fancy tax advisor, so I need to teach them how to handle my taxes. I realize these are pretty detailed, but maybe some of you are in the know.
I understand the basic tax rates, my questions mostly have to do with deductions and process:
1.) What are “reasonable deductions” as stated by every China tax guide? Can you just take deductions up to 50% of the tax you would have paid without them? I read that the most the tax bureau would take is 50%. What is reasonable for food deductions?
2) Do allowable amounts for deductions for expenses, travel allowance, etc. have to be laid out in the contract as “reimbursement” that is separate from salary and paid separately? Or can deductions just be claimed against the salary to a “reasonable amount” to reduce your tax burden if your accounting department is willing to work with you?
3) If you claim a travel allowance deduction for plane tickets back home, is there some way to spread that deduction over several months? Claiming a 1,000 dollar ticket on top of the housing deduction would probably put me well over the allowable amount for one month, but it would be helpful over the year.
4) Is local transportation (ie taxi receipts, domestic plane tickets) allowable?
5) What is the actual submission process like? Do all the receipts have to be submitted each month along with the tax payment?
I’m sure I have more questions, but I’ll stop here for now. Thanks ahead to anyone with answers.