The difference between tax residents and non-tax residents in China is primarily determined by the individual's place of domicile or habitual abode.
A tax resident in China refers to individuals who have their habitual abode in China or stay in China for more than 183 days within a calendar year (including days spent on short trips outside China). These individuals are subject to Chinese income tax laws on their worldwide income, regardless of where it is earned. This means that they must pay taxes on their income from both within and outside of China.
On the other hand, non-tax residents in China are those who do not meet the criteria for being tax residents. They are only subject to Chinese income tax laws on income derived from sources within China. In other words, they only need to pay taxes on income earned within China and are exempt from paying taxes on income earned outside of China.
In summary, the main difference between tax residents and non-tax residents in China lies in the scope of their taxable income and the duration of their stay in the country.
