China's tax authorities announced on July 24, 2026 a framework imposing a 20% personal income tax across the lifecycle of offshore trusts, with back taxes payable within 90 days of the announcement. An 'establishment tax' applies to trusts set up in 2023-2025, and a 'duration tax' covers accumulated returns through end-2025; trusts created before 2023 are exempt from the establishment tax. The rules leverage CRS data-sharing and have sent tech founders and wealth planners scrambling to reassess existing structures.
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China's new offshore trust tax hits founders: 20% PIT, back taxes due in 90 days
Why this matters for founders
Founders who hold company equity or exit proceeds via offshore trusts should immediately audit those structures with a tax adviser and calculate any back-tax exposure before the 90-day window closes. Those planning to set up trusts for future liquidity events must now price in the 20% PIT.
Source: Caixin Global
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