China’s currency is called Renminbi, also known as RMB and CNY, with the basic unit being the Yuan. 1 Yuan is equivalent to 10 Jiao or 100 Fen. 1 Yuan is about equal to $0.16 or £0.10.
Bank notes are currently available in 1 Jiao, 2 Jiao, 5 Jiao, 1 Yuan, 2 Yuan, 5 Yuan, 10 Yuan, 50 Yuan and 100 Yuan variants. Coins can be few and far between with coins from different eras not being widely produced any more and usage in differing regions varying. Coin sets produced include; Aluminium 1, 2 and 5 Fen coins from the 1950’s, Brass 1, 2 and 5 Jiao coins as well as Cupronickel 1 Yuan coins from the 1980’s and Aluminium 1 and 5 Jiao coins as well as 1 Yuan coins from the late 90’s to early 2000’s.
The largest exporter and second largest importer of all goods in the world, China is widely noted as the largest manufacturing economy in the world with a multitude of factories producing goods from clothes to computers. The current leader of China, Xi Jinping, the President of the Communist Party in the region, has declared that by 2021 China aims to be a moderately-rich society and by 2049, the country aims to become a fully developed nation. In the entire world, only three countries, China being one of them, has an economy above $10 Trillion.
Recently the country’s GDP has been valued at $5.87 trillion and as a result is accepted as the world’s second largest economy after the United States. However, it is likely that Chinese economy may surpass the US’s economy as early as 2020.
Banking in China is very much like banking in the west with a multitude of modern banks and many western banks having branches in the region. Additionally, over 1.2 Million merchants in China accept bank cards and over 170,000 ATMs exist throughout the region, allowing you to easily move without having to carry large amounts of money on your person.
There are three main account types open to Chinese expatriates, these include; Capital Accounts used for day-to-day usage and payroll income, Settlement Accounts also used frequently for day-to-day usage but not requiring an SAFE approval and the Foreign Debt Special Account which allows loans to be received from overseas.
China utilizes a range of taxes throughout the country, the most prominent being the income tax which works as follows:
Local Employees set the base rate of tax as 3% of any Taxable Income under CNY 1.5k. This is increased to 10% when earning between 1.5k and 4.5k, 20% at 4.5k to 9k, 25% at 9k to 35k, 30% at 35k to 55k, 35% at 55k to 80k and 45% at 80k+.
However, foreign employees work on an additional tax system based on the local one. First, the system is broken into two sub branches to separate base-level employees from senior executives. Next it is broken down again based on the duration of the individual’s stay.
Regular Foreign Employees are typically only taxed on their income provided that they’ve been in the country for at least 90 days but Senior Executives can be taxed from as early as day one of arrival in China. The amount of tax applied may increase as the stay lengthens and the threshold tends to be increased at the 90 day, 180 day, 1 year and 5 year marks.