Welcome to Herbert Smith Freehills’ new monthly private wealth industry updates in Asia.
Every month we survey ten Asian jurisdictions for legal developments concerning trust and estate planning which are of interest to the private wealth industry, and provide a succinct summary in a table format. The jurisdictions covered in the update are Hong Kong, Singapore, China, Taiwan, Japan, India, Malaysia, Indonesia, Thailand and the Philippines. We hope that these updates will prove to be a useful resource to keep private clients, business people, and lawyers abreast of legal updates in the region.
China extends individual income tax to worldwide income
China’s tax authorities are tightening individual income tax law by extending the scope to income earned globally.
The new individual income tax law came into effect in January 2019. Under the reform, tax will be imposed on the worldwide income of employees deemed as PRC residents for taxation purposes. A tax resident is defined as any China-domiciled individual, those who habitually reside in China because of their legal residency status, family, or economic ties or anyone who spends at least 183 days in a tax year in the country. It remains to be seen how the law is enforced. Recently, employees of some SOEs based in Hong Kong have been required to declare their 2019 salaries and make up any shortfall caused by the different tax rates in Mainland and Hong Kong.
The contents of this document are for reference purposes only. Some of the information comes from public sources and this may not be comprehensive, accurate or up to date; where we have relied on third party information and sources, this has not been verified by us. The document does not constitute legal advice, and should not be relied upon as such. Specific legal advice about your specific circumstances should always be sought separately before taking any action based on this publication, and any facts in this document should be checked for your specific circumstances at the time you wish to use or refer to them.