What Taxes Do Individual Business Owners Pay?
As a registered individual business owner (个体工商户) in China, you are generally responsible for the following taxes:
- Value Added Tax (增值税) — Small-scale taxpayers (小规模纳税人) pay a simplified rate; general taxpayers use the standard VAT system.
- Individual Income Tax (个人所得税) — Business income is subject to a progressive rate of 5%–35% after allowable deductions.
- Urban Maintenance and Construction Tax (城建税) — A surcharge based on VAT paid.
- Education Surcharge (教育费附加) — Another small surcharge on VAT.
Key Filing Deadlines
Most sole traders file VAT monthly or quarterly (by the 15th of the following month/quarter). Individual income tax is typically filed annually, with a reconciliation period from March 1 to June 30 each year.
How AI Makes This Easier
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Questions?
Contact our team for personalized guidance on your tax obligations.