Foreign nationals in Shanghai are subject to the Individual Income Tax Law and related policies, with the following key provisions:
Taxpayer Classification：Resident Taxpayers (residing in China ≥183 days/year): Taxed on worldwide income at progressive rates of 3%-45%. Non-Resident Taxpayers (<183 days): Taxed only on China-sourced income at rates of 20%-45%.
Preferential Policies：1. Tax-Exempt Allowances: Reasonable costs for housing, meals, relocation, laundry, home visits, language training, and children’s education are exempt upon providing valid supporting documents (per Cai Shui [1994] No. 20).
2. Choice of Benefits: Resident taxpayers must choose between Special Additional Deductions (e.g., housing rent, children’s education) or tax-exempt allowances—cannot be combined (policy valid until end-2027).
Regional Policies：Lingang New Area: Eligible high-end overseas talents receive financial subsidies to cap effective PIT burden at 15%.