China Issues Rules on Individual Income Tax for Offshore Trusts

China's Ministry of Finance and State Taxation Administration issued a notice on offshore trusts and individual income tax, according to Ming Pao. An official said some individuals have used offshore trusts in recent years for wealth transfer, cross-border asset allocation and risk management. Because offshore trusts are often set up in countries and regions with lower transparency and lighter tax burdens, some people have used them to move assets, conceal wealth and evade taxes. The notice clarifies rules on the establishment, continuation and liquidation of offshore trusts to improve tax certainty and transparency.