China's offshore-trust tax rules: what the 2026 notices say as the transition window closes

What the notices are

Unofficial translation. The notices are in Chinese. Only the Chinese texts are authoritative. English renderings below are our own unofficial summary.

On 24 July 2026 the Ministry of Finance and the State Taxation Administration published Announcement 2026 No. 21 on individual income tax matters relating to offshore trusts. The same day, the State Taxation Administration published Announcement 2026 No. 15 on related collection and administration matters.

Notice No. 21 defines an “offshore trust” for its purposes as a trust established under foreign law, or another foreign legal arrangement that has trust-like functions (with a stated exclusion for certain regulated financial products offered to the public). It addresses tax when property is placed in such an arrangement, while the arrangement continues, and when it ends.

What Notice No. 21 says about timing and categories

Article 3 of Notice No. 21 says that when a resident individual places property in an offshore trust, the taxable amount is based on market value at placement minus cost basis and reasonable expenses, and is reported under the individual-income-tax category “income from transfer of property”.

Article 4 says that, during the life of a resident individual’s offshore trust (and entities it holds, controls or manages), income arising is taxed to that resident individual under “income from transfer of property” or “interest, dividends and bonuses”, whether or not it is actually distributed, and is reported yearly. Income already taxed under those rules is not taxed again on later distribution.

On termination, Notice No. 21 treats the resident individual as the taxpayer on liquidation proceeds under “interest, dividends and bonuses” (Article 5).

Article 18 says the announcement takes effect from the date of publication (24 July 2026). Article 17 provides that certain unpaid amounts for specified earlier periods are to be declared and paid within 90 days from the date the announcement took effect, without late-payment surcharge for those amounts. That 90-day window, counted from 24 July 2026, closes on 22 October 2026. The window does not rewrite the substantive rules; it only addressed that transitional treatment.

When a resident individual becomes a non-resident while a trust continues (Article 6)

Article 6 says that if, while a resident individual’s offshore trust continues, that individual becomes a non-resident individual, tax is computed by reference to the market value of the trust property on the day of the change, minus cost basis, and is reported by that individual under “interest, dividends and bonuses”. Unpaid tax for the year of the change and earlier years remains to be dealt with under the announcement. We do not interpret how “becoming a non-resident” is established in any individual case.

What Article 11 says (and does not say)

Article 11 states that a person who has obtained foreign nationality, or foreign long-term or permanent residence, but whose main economic interests are sourced in China, may be determined to be a resident individual with domicile.

The notice does not say that holding a second passport or foreign permanent residence ends PRC tax residence. We do not advise on nationality, household registration (hukou), or dual nationality. For the site’s general limits on what we cover, see our disclaimer.

Administration (Notice No. 15)

STA Notice No. 15 sets which tax authority is the competent authority for offshore-trust individual income tax, and restates filing windows for placement and for yearly trust income (including, for resident individuals, 1 March to 30 June of the following year for certain returns). Readers should read the STA text and take advice from a qualified PRC tax professional on how any rule applies to them.

What this does not mean

This article is general information about published government notices. It is not legal, tax or immigration advice. It is not a personal tax position for any reader, family or trust. The transition window does not change the underlying rules in the notices.