The Chinese government released on its website the Circular of the State Council on Raising Some Thresholds for Additional Deductions in Individual Income Tax, deciding to raise three thresholds for additional deductions in individual income tax with effect from January 1, 2023.
First, it raises the threshold for special additional deductions in individual income tax for taking care of children under age 3 from 1,000 yuan to 2,000 yuan monthly.
Second, it raises the threshold for special additional deductions for education of each child from 1,000 yuan to 2,000 yuan monthly.
Third, it raises the threshold for special additional deductions for taking care of the elderly from 2,000 yuan to 3,000 yuan monthly. Specifically, if the applicant is the only child who care the elderly, an amount of 3,000 yuan can be deducted on a monthly basis. If the applicant has siblings, a monthly deduction quota of 3,000 should be allocated among the siblings and capped at 1,500 yuan for each person.