China MOF Announces Implementation of Preferential Individual Income Tax Policy for Personal Pension Contributions

The Chinese Ministry of Finance Dec. 12 issued Announcement No. 21, on the implementation of preferential individual income tax policies for personal pension contributions, effective Dec. 15. The policies include measures to: 1) implement deferred tax payment for personal pensions starting Jan. 1, with a 12,000 Chinese yuan (US$1,648) limit to the amount that an individual can contribute to their pensions per year; 2) exempt investment income included in the personal pension fund from income tax and impose a 3 percent tax when an individual receives money from their personal pension accounts; 3) require commercial banks to withhold and pay ...