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View Full Version : Tax in China


cactusmike
02-12-2011, 04:53 PM
I just received another job posting from Parc for a A320 Captain in China. I am curious (and a little lazy tonight) on how many contracts in China show the pay after taxes. The Parc offer was pretty ood but I was reading on the Fedex thread that payroll taxes in China are around 51%. If so that wuld knock down some of those payrates pretty hard. For example if Beijing Capital is paying 14000 per month before taxes and Asiana in Seoul is paying 7200 after Korean taxes then the Asiana deal is quite comparable. Otherwise it would appear that China is the place to go.

Those of you in China, how are you handling this?


EXPAT1
02-12-2011, 05:27 PM
It depends upon each individual contract. My contract on the 737 NG states the company will pay ALL Chinese taxes which is the case on the Capital gig also I believe. If you have to pay the taxes it is about 30% as I have friends at Jade and SF who pay those rates, however if you fly overtime and bonus pay can be taxed at the higher 40% rate. Just make sure you read the contracts carefully and remember all things are negotiable. As the demand in China continues to increase I think the companies will be forced to pay the taxes. China is a different animal though so make sure whoever you decide to go with you really want to be there. The Chinese CAAC does not allow contract jumping. Once you start at one carrier you won't be able to leave until you completely fulfill your current contract or the company is willing to release you, not likely in todays job market in China.

oicur12
02-18-2011, 11:40 AM
The PARC A330 contract has all chinese income tax covered by Air China. This offsets the income tax for most crews such as oz and euro based and covers my fed tax in the US but not CA state tax.


KoruPilot
02-19-2011, 12:27 AM
I ended up paying about 15% with Great Wall as it was an in house (no contract middle man) deal. A good chunk of the pay was considered an allowance of sorts so it worked out lower than the Jade guy's; not sure why Jade does it that way. Indeed, bonuses are paid with a rate of about 40%. I didn't worry too much about it as I live in, and therefore have to pay tax in New Zealand, so no biggie. If your living on an island in SE Asia perhaps a contractors terms would be better. . . but we are treated pretty well at GWL (bonused up to 16 months this year).

OceanicPilot
03-01-2011, 02:27 AM
Make sure that if they say they will pay the taxes they will give you copies of the tax statement with the official stamp. I use them to offset my U.S. taxes. I live in China so I claim the 90K+ exemption. If you make 180K a year you use the exemption to offset half of your U.S. income and then can use HALF of the chinese tax paid on your behalf as credit to your U.S. taxes as well. At least that's what my CPA did last year and he seems to have his finger on the pulse of foreign income taxes...I was quite happy with him.

I am at an established Chinese carrier and living well. I'm anxious to finish my 3 year contract next year and move to a more profitable one though mine isn't bad. Check out Tianjin Airlines as they are acquiring new 320's and need pilots badly. If you live here the Tianjin, Sichuan, or Deer contracts are probably the best...if you want to commute the new Tianjin contract can't be beat. I'm looking at them seriously for my next one which will most assuredly be a commuting deal as my wife and kids are going to move back to the States then. If you have any questions feel free to PM me.

Good luck!

cactusmike
03-01-2011, 07:38 PM
Thanks for the info guys....I don't see things changing here in Cactusland for a very long time and my wife and I are considering other options.

Typhoonpilot
03-04-2011, 11:25 PM
Thanks for the info guys....I don't see things changing here in Cactusland for a very long time and my wife and I are considering other options.

Mike:

I've been watching your posts for a long time and I know you've been contemplating a move out of Airways. My understanding is that you are a fairly senior captain on the west side. That would mean that you live in your home base and have a very reasonable schedule. Your income is probably reasonable as well.

That said, why would you leave?

Working overseas is very different. The first time I did it as a captain in the mid 90s I still thought it would be better to be a First Officer at a major in the USA than a captain overseas. So when Airways recalled in 98 I went back. That was a different Airways of course, one with a pension and far better work rules than today.

Even with the downward slide in pay and conditions, being a captain at major in the USA would still be far better than most overseas jobs.

Most of us who are overseas didn't have a choice, we were furloughed or at low paying airlines with no career progression. The senior guys who bailed from the majors to keep their pensions also made a move of necessity.

Almost without fail, those who left good jobs to come overseas regret it after a few years. There are exceptions to that of course, but I get to see a lot of examples here and elsewhere so I have a pretty good picture.

Living in China would be a challenge. Working for the Chinese would be a bigger challenge. The management mindset there is quite different. They use a hammer to beat employees when they make the smallest of mistakes. Witness all the QAR violation fines and "safety bonuses" that these contracts have. That and sick time limitations. They'll work you far harder than you're working now.

It may look like an adventure and it probably would be, but think carefully before you leave a good job in the USA. You'll be leaving a lot that you take for granted behind.



Typhoonpilot

iluvetops
03-05-2011, 01:57 AM
TP.

Very well said. If I could, I would rather be an FO with SWA than what I am in now.

Kapitanleutnant
03-08-2011, 12:07 AM
I couldn't agree more with Typhoon and tops....

I jumped from a Major airline as a captain stuck with no career progression and got tired of Tulsa layovers all month long, each month, to come to the middle east to fill my ego. It did for a few years and now.... I wish I could run the clock back and do all Tulsa layovers at this point.

I made the mistake of the "big airplane syndrome" here and let my ego get in the way of a thought out plan.

Oh, how I wish to be in the Hotel 6 at the TUL layover airport right now... :-)

K

pierre66
05-15-2011, 11:07 PM
I haven't been on APC for months and just found this thread.

I have been with a Shanghai based Chinese carrier for 9 months as a DEC on the 744. I retired from NWA/Delta to take this job for a multitude of different reasons, mostly financial. Koru above helped me quite a bit with the "due diligence". So far it has been pretty much what I expected although we are going through a merger right now that will make it more "Chinese" and it looks like they are going to ******* up what was a good gig......

The contract pays in RMB which was one of the reasons I went for it. As Koru explained, the tax rate ends up being about 16% of the gross. I was able to take a dollar for dollar tax credit for that Chinese tax paid on my 2010 return and will qualify for the exclusion in 2011 like Oceanic above since I also chose to live in China. You can get the tax receipts for this and they are also necessary to wire money out of China.

The contract jobs over here seem to mostly pay in USD, net of any tax, into a foreign bank account of your choice. My new employer is going to offer an expat contract like this or the option of staying on the existing RMB/Chinese taxed contract. If I decide to stick around I will likely opt for the RMB contract since I want to be paid in that currency and the tax credit is usable.

Hope this adds a bit of light!

KoruPilot
05-16-2011, 08:19 AM
Hey pierre, a little off topic, but Restaraunts was pumping last week. You shoulda been there.

The money sucks but the surfing is great.