How inheritance tax works in China
China levies no inheritance or estate tax. Assets passing on death reach heirs without any Chinese succession charge in 2026, despite decades of policy discussion.
Lifetime gifts to family members and heirs are exempt from individual income tax when properly documented. Gratuitous transfers to non-relatives are taxed at 20% on the assessed value.
The donee inherits the original cost basis. A later sale is taxed on the gain since the donor first bought, so family cost records carry real value.
Tax rates at a glance
- Estate tax
- 0%None in force
- Inheritance tax
- 0%
- Family gifts
- 0%
- Non-relative gifts
- 20%
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
FamiliesInvestorsHigh earnersExpatsFamily offices
Watch out for
- Exempt family gifts need real documentation and registration. Informal handover of property without title transfer creates tax and ownership risk at once.
- The 20% charge on non-relative gifts applies to the assessed value, not the declared price. Understating a property gift does not reduce the bill.
- Heirs inherit latent gains with no step-up. A tax-free inheritance can become a large 20% gains bill when the asset is eventually sold.
- Succession proposals resurface regularly in China. None is law, but large families should keep structures flexible and wills current.
Frequently asked questions
Does China have inheritance tax?
No. China has no inheritance, estate or gift tax in force, although policymakers have discussed one for years.
Are gifts taxed in China?
Family and heir transfers are exempt with documentation. Gifts to non-relatives pay 20% on the assessed value.
What tax do heirs pay on inherited property?
Nothing on receipt. But a later sale is taxed at 20% on the gain measured from the original owner's purchase cost.