Employment Income Transfer China

Consult an Expert

Learn about our solutions and receive a proposal and guidance about your business inquiry.

Share this article

The foreign exchange of funds is tightly monitored and controlled by the Chinese authorities, which poses limitations for the free in- and outflow of funds to/from China. As such, a common challenge for foreign individuals employed in China is sending funds from their Chinese bank account to a bank account outside of China. Whether a foreign individual is leaving the country or wishes to repatriate savings which were built up in China, it is important to realize it is not possible to simply transfer these funds through an online banking platform as is common in countries where funds can flow more freely across borders.

It should be noted that several different methods exist for individuals to repatriate funds to overseas from China, however, not all are compliant with PRC legislation. In this article we discuss the method for individuals to transfer income from employment to a bank account abroad safely and compliantly.

Background to Foreign Currency Exchange for Individuals

According to PRC regulations, any company or individual which intends to transfer funds out of China must file an application with the State Administration of Foreign Exchange (SAFE). In practice, local banks in China are responsible for the implementation of the approval processes as set out by the SAFE. This means that the banks are required to review the necessary documents for an outward transfer of funds and execute the transaction when the documentation is in line with the established requirements.

Although within the bounds of the applicable legislation it is in theory possible for any individual (foreign or Chinese) to freely convert up to USD 50.000 per annum, we must note that certain limitations may still exist in practice and there are as well limitations in place regarding the amounts of foreign currency that can be physically taken out of China by an individual.

However, by law there is no limit to the amount of funds that can be legally transferred out of China if it can be proven that the funds were earned as income from employment and that the relevant taxes due have been declared and paid. Here it is the responsibility of the individual to prove that the funds have been obtained through legal employment and that taxes have been paid.

Send us your question and we will answer within 24 hours. Message  →

Procedures for Individuals to Transfer Funds out of China

It is important to note that the procedures for an individual to apply for the transfer funds from China must be physically completed at a bank branch of the individual’s personal bank. The application can either be performed by the individual him/herself or by authorizing a third party to act on your behalf, by signing a power of attorney (PoA).

To complete the application procedures with your local bank, generally the following documents are required:

IIT Receipts

As mentioned previously, the Chinese authorities require proof that the correct amount of taxes have been declared and paid prior to funds being transferred out of China. In order for an individual to proof that the correct amount of Individual Income Tax (IIT) has been paid, one must apply to obtain their IIT receipts.

At the respective tax bureau where the employer is registered, the employee can obtain his/her IIT Receipts specifying the amounts of tax paid monthly. Here it is also possible to authorize a third party to obtain IIT Receipts on your behalf by signing a PoA.

Identification Document

For the application, a valid identification document should be shown to the bank which means that foreign individuals are required to show their passports. For most banks only the original passport suffices, meaning (legalized) copies will not be accepted, even in the case a third party is handling the application procedures.

Employment Contract

Furthermore, to validate that the income was received from employment a valid employment contract with a Chinese legal entity has to be provided. It is important that the amount of salary specified in the employment contract matches with the amount on the payroll overview (see next requirement) and the corresponding IIT Receipts. For an employment contract to be valid, the employment period must be correctly indicated, and the contract must be signed by the individual and chopped by the company.

Payroll Overview

A payroll overview, such as an employee’s pay slip, is required as well and will be used to match the amounts of salary specified in the employment contract as well as the appropriate amount of taxes as per the IIT receipts.

Bank Card

Several local (Chinese) banks will also require seeing the physical bank card of the respective individual’s bank account. This means that also when a third party is appointed to execute the application procedures on an individual’s behalf, the third party must be in possession of the bank card during the application.

Bank Statements

Another set of documents which may be required to proof the income received and the current balance on the bank account is the bank statements of the specific bank.

General Information Needed for the Application:

  • Individual’s full name
  • Individual’s address in foreign country
  • Beneficiary’s bank name
  • Beneficiary’s bank address
  • IBAN (International Bank Account Number)
  • SWIFT Code

Once the application for an individual to exchange foreign currency is approved, the bank will purchase the foreign currency with the total amount that the individual would like to transfer. Upon approval from the sender, the Chinese bank will usually execute the transfer of funds immediately to the bank account abroad. Subsequently, it depends on the country of destination and the beneficiary’s bank what time is required for the funds to be received on the individual’s bank account abroad. We do note that the foreign bank may request additional documentation on their side as well, before releasing the funds.


As long as all correct documents are collected and the procedural requirements are satisfied, the process to repatriate funds from employment income out of China are fairly straightforward. However, not all personnel in every bank branch is familiar with the procedures and communication problems may occur due to language barrier. Therefore, proficiency in Chinese and familiarity with the procedures, will certainly smoothen the application process. MSA regularly supports clients with sending out income to foreign bank accounts. Should you require our support or if you have any questions, don’t hesitate to reach out to us, or check out our IIT & Payroll Services page.