Thinking about Moving to China? Family Fun and Travel

Matt | Family,Traveling | Friday, June 24th, 2011

Continuing on with questions about moving to China, here are a few more of them you might want to ask or answer before you come.

What entertainment is available for children or families?

My first reaction to this question was I’m not really sure as I arrived in Beijing a single guy and left a happily married man. The more I thought about entertainment for children and families the more my mind centered on expat magazines, such as TheBeijinger, Timeout and CityWeekend, and how the often have sections devoted solely to children and young families.

When you arrive in Beijing you can pick up the expat magazines at most western restaurants and cafes such as Grandma’s Kitchen or The Bookworm. I would recommend you pick up a few of these magazines shortly after you arrive and scan through for anything that looks good. Once you pick an event, you’ll likely meet some expats with kids who can give you better information on what they recommend for children. As there is a strong expat community in the larger cities such as Beijing and Shanghai, with many international schools, there are also a lot of organizations that are family friendly. It took me two years to figure this out, but after I did I quickly found a Saturday morning ball hockey league which led me to ice hockey and I also found many Toastmasters clubs. These magazines are great for connecting you to many interesting and exciting happenings in the large cities.

For example,

If you are planning on moving with a young family this is obviously a much more challenging decision than when I decided to come alone back in 2005. If possible, I recommend you take a trip to China, by yourself or with the entire family, to get a better perspective of what one to two years living overseas may look, feel and taste like before you move your family.

How much would I pay for a personal day tour to several places?

This is a tough question as it depends on what you want to do. The expat magazines have loads of travel excursions that range from reasonable to expensive. Also most hotels, if not all, will have a travel desk where they can book your day trips or future travel plans. To give you a general idea I recommend you pick up a travel guide book, such as Lonely Planet or Fodor’s, as the prices range depending on the type of travel you want to do. Also, be careful as to when the guide was printed as some prices may be higher than the book, but it should give you a general framework to budget with.

Thinking about Moving to China? Taxes & Banking

Matt | Banking in China,Taxes in China | Friday, June 10th, 2011
Continuing on answering the questions a reader posted, thanks again by the way, here are a few more of my thoughts. These are my thoughts and opinions from my experience of living in Beijing for four years.  I hope I can give some insight into the situation although you should continue to do other research.
One of the most important things that I can recommend before moving to China, or to any country, is to do your research.  Make sure you have a good understanding of what you are getting yourself into and are asking as many questions as you can.  Then at some point you will have to make a decision, without knowing how everything will work out.  Finally, if you are flexible enough with “open eyes, an open mind, and an open heart,” you will end up in a better place.
How are income taxes handled in China?
Income taxes in China are deducted from your paycheque every month as source deductions.  From a nice little handout a former employer gave me, here is the breakdown of how income tax works for foreigners.  I received this in 2006 and so things may have changed now, but this should give you an idea and things to think about.  The tax you pay is a sliding scale ranging from 5% to 45%, but generally speaking it is quite low.  I will give you the brackets and then show you an example.
Full-Time Employees
Tax Bracket     Monthly Income     Tax %     Tax Rebates
1                         Up to 400 RMB             5%              0
2                         500-2,000                   10%            25
3                         2,000-5,000                15%            125
4                         5,000-20,000              20%            375
5                         20,000-40,000            25%            1375
6                         40,000-60,000            30%            3375
7                         60,000-80,000            35%            6375
8                         80,000-100,000          40%            10375
9                         100,000+                    45%            15375
  • Foreigners first 4,800 RMB is tax free.
I have given a lot of big numbers, so I will walk through an example of one of my old pay cheques to show that the tax rate we pay is actually quite low.
While working as a PT trainer one month I earned the following
10,782 RMB gross salary
5,982 RMB taxable income
x 20% (this is the only bracket I was in while in China!)
1196.4 taxable income before rebate
-375 tax rebate in this tax bracket
821.4 tax actually deducted from my salary
7.6% (821.4/10,782) actually tax rate for the month
9960.6 RMB amount deposited in my bank.
Overall, I found the tax rate quite low as a full-time foreign worker.  Additionally, you can reduce your taxable income with a Meal Allowance for business purposes, ie restaurant recipes, but no more than 4,000 RMB/month.  I never did this, although you may see a lot of locals getting official receipts at restaurants and from taxis likely to reduce their taxes payable.
Another thing to note is that if you live in China for 5+ years continuously you are classified a Chinese Citizen for tax purposes and you are only entitled to the rate of 1600 RMB not the 4800 RMB for Foreigners.  Therefore, it would be wise to leave China for more than a month (30 days) every 5 years.
Finally, if you are earning in the higher tax brackets it would be wise to talk to a professional, tax accountant and lawyer, to help you understand what your options are.  Fortunately, or unfortunately, I never got to that level.
Would you explain further any online banking and money transfers steps to the USA?
As for banking in China and setting up direct deposits, I wrote an earlier post here about how to do this.  I was able to wire money from my ICBC account to my account in Canada regularly.  Now I wasn’t sending large sums ($500-$1000 CAD/month), but for most people I think this would be the case.  If you want to send back a lot more money, again I suggest to talk with a good banker, lawyer or business owner who is already doing this.  Best of luck.

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