Finance & Money · 个税起征点 · Updated 2026-10-25
What Is Individual Income Tax Threshold?
Definition
China’s standard deduction is 5,000 yuan/month, but real exemptions include social insurance contributions and 7 special deductions (children, mortgage interest, elderly support, etc.) before progressive rates of 3%–45% apply.
Formula
Taxable income = annual income − 60k − social insurance − special deductions
Worked Example
A 12k salary with 2,640 social insurance plus 3,000 deductions leaves only 1,360 taxable — 40.8 yuan of tax.
Common Misconception
"The threshold is 5,000 so I pay no tax" - 5,000 is only the first deduction layer; and "under 5,000 means no annual reconciliation" is also wrong - combined income from multiple sources may still require a top-up.
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