Tax Deductions

The State Council announced special individual income tax deductions on December 22, 2018, in order to lower the tax burden for those with certain expenditures.

These include children’s education, continuing education, health treatment for serious diseases, housing loan interest, rent and elderly care.

The new temporary measures will take effect along with the amended personal individual income tax law on January 1, 2019.

For children’s education, an amount of 1,000 yuan ($145) will be deducted every month from the parents’ taxable income for each child’s education from preschool through doctoral education, including technical education.

Taxpayers with serious diseases will have their amount of out-ofpocket medical costs deducted from their taxable income each year.

In addition, taxpayers or their spouses who have first home mortgage loans are allowed a deduction of 1,000 yuan per month from taxable income.

Housing rent deduction of up to 18,000 yuan ($2,613) each year will be granted to taxpayers who own no housing in the city where they work.

An amount of up to 2,000 yuan ($290) will be deducted every month from an only-child’s taxable income for his or her parent who is over 60 years old.