The Deadline of Tax Penalty Waiver Program for Foreign Residents

On 11 March 2004, the State Administration of Taxation ("SAT") published the circular (Guoshuifa) [2004] No. 27, announcing the tax penalty waiver program to allow non-PRC residents to report and pay delinquent tax liabilities under the PRC Individual Income Tax ("IIT") without incurring any penalties. Although the penalties were waived under the program, surcharges on the originally delinquent IIT payments were still applied to the underpaid tax liability.
The non-PRC residents, their employer or other withholding agents should report and remit payments before the final extension date of 31 December 2004. It is unlikely that the authorities will further extend the provisions of the penalty waiver program after 2004.

The purpose of Circular 27 was to encourage the filing and payment of back taxes, it is likely that SAT will dedicate resources to ensure the full compliance with IIT reporting and non-compliance could result in severe penalties.

在華非中國籍人員，其雇主或其相關代扣代繳義務人必須在最後寬限期2004年12月31日前申報和繳納所欠之個人所得稅。中國稅務機關可能在最後寬限期2004年底後不會延長此罰款赦免規定。

由於27號文旨在鼓勵非中國籍人員申報繳納應繳納未繳稅款，中國國家稅務總局將很有可能全面部署個人所得稅加強征管的相關工作。