China Extending Certain Individual Income Tax Preferential Policies

During an executive meeting held on 29 December 2021, China's State Council decided to extend the implementation of certain individual income tax preferential policies. This includes:

• The exclusion of annual year-end bonuses in calculating monthly salary income is extended until the end of 2023, with bonuses taxed according to a separate calculation, which is essentially meant to prevent bonuses from increasing an individual's tax bracket;
• For individuals with annual income below CNY 120,0…