China’s State Taxation Administration (STA) says it has received individual income tax declarations on offshore trust earnings totalling more than 160 billion yuan (about US$23.8 billion), after a 90-day transition period for voluntary declaration ended this week. More than 120 billion yuan of that was collected in October alone, contributing to an almost 90% year-on-year jump in China’s individual income tax revenue that month, Xinhua reported.
The rules, issued by the Ministry of Finance and the STA on 24 July 2026, require Chinese tax residents who receive offshore trust earnings — including gains from share sales and dividends generated through such trusts — to declare and pay individual income tax, with uniform calculation standards clarified for the first time. During the 90-day transition, taxpayers could declare and pay without late-payment surcharges; the STA said the “vast majority” complied.
Beijing National Accounting Institute professor Li Xuhong said the rules improve policy certainty and reflect the basic principle — common in international tax practice — that residents are taxed on both domestic and overseas income, including earnings routed through offshore trusts.
With the transition period now over, the STA says it will pursue taxpayers who made inaccurate declarations or missed the deadline, applying late-payment surcharges, and will investigate intermediaries or individuals found to have assisted tax evasion.
References
Xinhua – China Wraps Up Offshore Trust Tax Transition, Declared Tax Tops 160 Bln Yuan
