China’s tax authorities have begun applying new rules to offshore trusts as private bankers tell CNBC wealthy clients are asking more about U.S. accounts, a shift with no reported figures on its scale.
China’s Ministry of Finance (MOF) and State Taxation Administration (STA) issued Announcement No. 21 on July 24, 2026. It sets individual income tax treatment for property placed in offshore trusts and covers some arrangements that function like trusts. MOF and STA officials said the rules aim to clarify taxation and address the use of trusts to transfer or conceal wealth and evade tax.
For Chinese tax residents, the 20% tax on property placed in an offshore trust is calculated on its market value minus its original value and reasonable expenses; nonresidents are covered in specified cases. A 20% rate also applies to qualifying trust income and some proceeds when a trust ends for applicable taxpayers, subject to rules on residency and who contributed the assets. Treatment also depends on the income type.
The announcement set a 90-day period for settling specified unpaid tax on assets placed in offshore trusts from Jan. 1, 2023, through Dec. 31, 2025, and certain trust income earned before Jan. 1, 2026. The period ended Oct. 22.
The CNBC report said some clients of Keith Tan, CEO of Singapore-based Golden Acacia Capital, began planning transfers to the United States in July and opened accounts in less than two months. CNBC also cited increased inquiries at U.S. banks, drawing on an unnamed New York wealth-planning adviser. The report did not quantify clients, transfers or assets. Clifford Ng, a partner at Zhong Lun in Hong Kong, told CNBC, “Hiding is not tax planning.”
MOF and STA guidance says Chinese tax residents owe tax on income from inside and outside China. A person’s foreign citizenship or long-term stay abroad does not necessarily change that status if China remains the center of their economic interests.
The United States does not participate in the Organisation for Economic Co-operation and Development’s (OECD) Common Reporting Standard, which supports automatic exchange of financial-account information among participating jurisdictions. Internal Revenue Service rules cover reporting on certain U.S. bank deposit interest paid to residents of China, but China was absent from the IRS’s separate 2024 list for automatic exchange of that interest data. Those rules concern specified interest payments, not full account balances; the U.S.-China tax treaty also contains an information-exchange provision.
The tax burden falls on people who meet China’s residency rules and owe tax on covered trust transfers or income; putting funds in a U.S. account alone does not remove those obligations. U.S. banks could gain account business if reported inquiries lead to transfers, though CNBC provided no flow figures.
