1. The personal income tax deduction ratio of 50 is the average deduction, that is, the parents of educated children deduct 50% of the deduction standard respectively, and distribute the expenses needed for their children's education equally.
2. Personal income tax deduction ratio of 100 means full deduction, that is, the expenses of educated children are borne by one parent, and deducted according to the standard ratio of 100%. The specific deduction method shall not be changed within one tax year after the selection is completed.
Taxpayers of personal income tax in China are those who live in China and those who do not live in China, including citizens in China, foreigners who get income from China and compatriots from Hong Kong, Macao and Taiwan.
Individuals who have a domicile in China or have no domicile in China for 1 year are resident taxpayers and should bear unlimited tax obligations, that is, they should pay individual income tax according to law on their income obtained in China and abroad.
Individuals who have neither domicile nor residence in China, or who have lived in China for less than one year, are non-resident taxpayer, bear limited tax obligations, and pay personal income tax according to law only on their income obtained from China.
Personal income tax has three different tax rates according to different tax items:
1. Comprehensive income (income from wages and salaries, income from labor remuneration, and income from royalties) shall be taxed at an excessive progressive tax rate of 7 levels, and the taxable income shall be calculated on a monthly basis. The tax rate is divided into seven levels according to the taxable income of individual monthly wages and salaries, with the highest level being 45% and the lowest level being 3%.
2. Operating income is subject to a 5-level excess progressive tax rate. The income from production and operation of individual industrial and commercial households and the annual taxable income from contracted operation and lease operation of enterprises and institutions are divided into five grades, with the lowest grade being 5% and the highest grade being 35%.
3. Proportional tax rate. Personal income tax is levied on personal income such as interest, dividends, bonus income, property lease income, property transfer income, accidental income and other income, and the proportional tax rate of 20% is applicable.
China's personal income tax is levied by combining source withholding and self-declaration, with the focus on source withholding. The collection methods of personal income tax can be divided into monthly collection and annual collection Income from production and operation of individual industrial and commercial households, income from contracted operation and lease operation of enterprises and institutions, income from wages and salaries of specific industries and income obtained outside China shall be taxed on an annual basis, and the taxable amount of other income shall be taxed on a monthly basis.