{"id":5704,"date":"2026-04-26T10:30:53","date_gmt":"2026-04-26T10:30:53","guid":{"rendered":"http:\/\/ms-advisory.flow-work.online\/?p=5704"},"modified":"2026-04-27T19:59:18","modified_gmt":"2026-04-27T19:59:18","slug":"china-tax-rates","status":"publish","type":"post","link":"https:\/\/msadvisory.com\/china-tax-rates\/","title":{"rendered":"China Tax Rates 2026: CIT, VAT, IIT, Expat Guide"},"content":{"rendered":"\t\t
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Most pages claiming to explain the China tax rate stop at the headline 25% Corporate Income Tax number and call it a day. That number is correct, and on its own it’s nearly useless.<\/p>

The real answer for a foreign founder, finance director, or expat in 2026 is layered. Standard CIT is 25%, but the rate you actually pay can drop to 15% (HNTE), 5% (small low-profit enterprise), or even an effective 0% in specific Free Trade Zone programs. VAT runs 13%, 9%, or 6% depending on what you sell. Individual Income Tax climbs from 3% to 45% across seven brackets, but foreign talent in Qianhai and Hainan caps at 15% effective. Withholding tax on dividends out of China is 10% \u2014 unless the treaty drops it to 5%.<\/p>

This guide is the consolidated 2026 version. One page, every rate, every bracket, every exemption that matters for foreign-invested companies and foreign individuals working in China.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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\"Shanghai<\/a><\/figure>
Request a China Tax Consultation<\/a><\/div>

Send us your questions and we will answer within 24 hours\nMessage  \u2192<\/span><\/p><\/div><\/div>\t\t\t\t<\/div>\n\t\t\t\t

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The 2026 China Tax Rates at a Glance<\/h2>

Standard rates per State Taxation Administration [1]<\/sup>; SLPE\/VAT extensions per State Council [3]<\/sup>.<\/em><\/p>

Tax<\/th>Rate<\/th>Notes<\/th><\/tr><\/thead>
Corporate Income Tax \u2014 standard<\/td>25%<\/strong><\/td>Domestic & foreign-invested companies<\/td><\/tr>
CIT \u2014 High-and-New Tech Enterprise<\/td>15%<\/strong><\/td>Valid HNTE certificate required<\/td><\/tr>
CIT \u2014 Small Low-Profit Enterprise<\/td>5% effective<\/strong><\/td>First RMB 3M; extended through 2027<\/td><\/tr>
CIT \u2014 FTZ-qualifying<\/td>15%<\/strong><\/td>Lin-gang, Qianhai, Hainan<\/td><\/tr>
VAT \u2014 most goods<\/td>13%<\/strong><\/td>General taxpayer<\/td><\/tr>
VAT \u2014 transport, basic goods<\/td>9%<\/strong><\/td>General taxpayer<\/td><\/tr>
VAT \u2014 services & intangibles<\/td>6%<\/strong><\/td>General taxpayer<\/td><\/tr>
VAT \u2014 small-scale taxpayer<\/td>1% (through 2027)<\/strong><\/td>Annual revenue \u2264 RMB 5M<\/td><\/tr>
Individual Income Tax<\/td>3% \u2013 45%<\/strong><\/td>7 brackets, RMB 60,000 deduction<\/td><\/tr>
Withholding Tax on outbound dividends<\/td>10% standard<\/strong><\/td>5% under HK\/SG\/UK\/EU treaties<\/td><\/tr><\/tbody><\/table><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t
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Corporate Income Tax (CIT) in 2026<\/h2>

China’s standard CIT rate is 25%<\/strong>. It applies to every tax-resident enterprise \u2014 every company incorporated in China, plus any foreign company with its place of effective management in China \u2014 and to non-resident companies on their China-sourced business income. There are no provincial CIT add-ons, which makes the headline rate cleaner than the U.S. or German equivalents.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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The standard 25% rate<\/h3>

The 25% is calculated on taxable income<\/strong>: gross revenue minus deductible costs, allowable expenses, depreciation, R&D super-deductions, and prior-year losses (carried forward up to 5 years; 10 years<\/strong> for HNTEs and qualifying tech enterprises).<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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15% for High-and-New Technology Enterprises (HNTE)<\/h3>

If your Chinese company holds a valid HNTE certificate<\/strong>, your CIT rate drops to 15%<\/strong> for the certificate’s three-year validity period (renewable). The qualifying tests are real: IP rights to core technology in one of eight encouraged HNTE fields; R&D personnel \u2265 10% of total headcount; R&D spending above the revenue-tiered threshold (5% if under RMB 50M revenue, 4% under RMB 200M, 3% above); high-tech products\/services contributing \u2265 60% of total revenue.<\/p>

Genuine software, biotech, advanced manufacturing, and certain hardware businesses qualify regularly.<\/p>

The R&D super-deduction (most under-used lever)<\/h3>

Through December 31, 2027, eligible R&D spending is deductible at 200% of the actual amount<\/strong> for most companies, and 220%<\/strong> for integrated-circuit and CNC machine-tool sectors. RMB 1 million of qualifying R&D becomes RMB 2 million of deduction \u2014 a real cash effect on the CIT bill, even before HNTE status is layered on top.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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Small Low-Profit Enterprises \u2014 the 5% effective rate<\/h3>

The most-misquoted China tax rate. Companies with annual taxable income \u2264 RMB 3 million, headcount \u2264 300, and total assets \u2264 RMB 50 million pay an effective 5%<\/strong> on the full RMB 3 million through December 31, 2027 [3]<\/sup>. The legal mechanism is a 25% reduction applied to a 20% rate. Most early-stage WFOEs qualify.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t

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Value-Added Tax (VAT) in 2026<\/h2>

The three general-taxpayer bands<\/h3>