The Personal Income Tax Preferential Policy states that high-end talents and talents in short supply who work in the Hainan Free Trade Port are exempted from paying personal income tax for the portion of actual tax burden exceeding 15%.
As per the eligibility criteria, the following are the conditions for high-end talents:
1. They must be recognized as talents by talent management departments at all levels in Hainan Province.
2. They should have earned income in the Hainan Free Trade Port of more than RMB 300,000 within a tax year.
3. They must work in the Hainan Free Trade Port, pay basic pension insurance and other social insurance for more than 6 months within a tax year (including December of the current year), and provide labour relationship certification materials such as a labour contract or employment agreement with an enterprise or unit registered and substantially operated in the Hainan Free Trade Port for more than one year. Overseas high-end talents who are unable to pay social insurance must provide labour relationship certification materials such as a labour contract or employment agreement with an enterprise or unit registered and substantially operated in the Hainan Free Trade Port for more than one year.
To be eligible as Talents in Short Supply, the following conditions must be met:
1. The individual's area of expertise must be within the scope of the Catalogue of Talents in Short Supply demanded by the Hainan Free Trade Port industries.
2. The individual must work in the Hainan Free Trade Port, pay basic pension insurance and other social insurance for more than 6 months within a tax year (including December of the current year), and provide labour relationship certification materials such as a labour contract or employment agreement with an enterprise or unit registered and substantially operated in the Hainan Free Trade Port for more than one year. Overseas talents in short supply who are unable to pay social insurance must provide labour relationship certification materials such as a labour contract or employment agreement with an enterprise or unit registered and substantially operated in the Hainan Free Trade Port for more than one year.
The management of the list will be implemented for high-end talents and talents in short supply who are eligible for preferential policies. There is no need to apply for talent identification. Relevant departments will confirm the list of eligible talents through information sharing and by checking personal credit, social security records, and other information. Once an individual is on the list, they can enjoy the preferential policies.
Frequently Asked Questions:
What kind of income is eligible for personal income tax preferential policies? How to enjoy preferential policies?
1. The income eligible for preferential policies includes comprehensive income (including wages, salaries, labour remuneration, royalties, and licensing fees) sourced from the Hainan Free Trade Port, business income, and talent subsidy income recognized by Hainan Province.
Wage and salary income refers to the income individuals obtain from the unit of employment in Hainan, including wages, salaries, bonuses, year-end salary adjustments, labour dividends, allowances, subsidies, and other related income from the employment.
Labour remuneration income refers to the income individuals obtain from labour services in Hainan.
Royalty income refers to the income individuals obtain from the publication or presentation of their works in the form of books, newspapers, and other forms in Hainan.
Licensing fee income refers to the income individuals obtain from providing the right to use patents, trademarks, copyrights, non-patent technologies, and other licensing rights in Hainan.
Business income refers to the income obtained from production and business activities in Hainan.
Talent subsidy income recognized by Hainan Province is confirmed according to the recipients and distribution methods. Those related to employment are included in comprehensive income, and those related to production and business activities are included in business income.
2. Enjoy preferential policies when handling the annual settlement and payment of personal income tax in Hainan Province.
"How to Calculate the Reduced Tax Amount?
1. Calculation of the Reduced Tax Amount for Comprehensive Income of Resident Individuals
Reduced Tax Amount = (Taxable Amount of Comprehensive Income - Taxable Income Amount of Comprehensive Income × 15%) × Hainan Comprehensive Income Amount ÷ Comprehensive Income Amount
2. Calculation of the Reduced Tax Amount for Operating Income of Resident Individuals
Reduced Tax Amount = (Taxable Amount of Operating Income - Taxable Income Amount of Operating Income × 15%) × Hainan Taxable Income Amount of Operating Income ÷ Taxable Income Amount of Operating Income
3. Calculation of the Reduced Tax Amount for Relevant Income of Non-resident Individuals
Reduced Tax Amount for Non-resident Individuals' Salary and Wage Income = (Taxable Amount of Salary and Wage Income - Taxable Income Amount of Salary and Wage Income × 15%) × Hainan Salary and Wage Income Amount ÷ Salary and Wage Income Amount
Reduced Tax Amount for Non-resident Individuals' Income from Labour Services, Royalties, and License Fees = Hainan Taxable Amount - Hainan Taxable Income Amount × 15%
Reduced Tax Amount for Non-resident Individuals' Operating Income = (Taxable Amount of Operating Income - Taxable Income Amount of Operating Income × 15%) × Hainan Taxable Income Amount of Operating Income ÷ Taxable Income Amount of Operating Income
Q3 What if I'm worried about miscalculating the reduced tax amount?
The tax department provides a calculation service. When handling the annual settlement and payment of personal income tax through the Personal Income Tax App or the Natural Person Electronic Tax Bureau, the system will automatically calculate your reduced tax amount.
Q4 How can I learn about the personal income tax preferential policies in Hainan Free Trade Port?
1. Call the 12366 tax payment service hotline.
2. Consult online through the "Hainan Taxation" WeChat public account.
3. Consult with the tax authority in person."
Policy Basis:
"Notice of the Ministry of Finance and the State Administration of Taxation on the Personal Income Tax Policies for High-End and Scarce Talents in Hainan Free Trade Port" (CaiShui [2020] No.32).
http://www.chinatax.gov.cn/chinatax/n36 ... ntent.html
"Notice of the People's Government of Hainan Province on Issuing the Interim Measures for the Management of High-End and Scarce Talents Enjoying Personal Income Tax Preferential Policies in Hainan Free Trade Port" (QiongFu [2020] No.41).
https://mp.weixin.qq.com/s?__biz=MzA4Mz ... t_redirect
"Notice of Hainan Provincial Department of Finance, State Taxation Administration Hainan Provincial Taxation Bureau, Provincial Market Supervision Administration, and Provincial Talent Development Bureau on the Implementation of Personal Income Tax Preferential Policies for High-End and Scarce Talents in Hainan Free Trade Port" (QiongCaiShui [2020] No.1019).
http://mof.hainan.gov.cn/sczt/0503/2020 ... 816d.shtml
