In Depth: China’s Tax Collectors Target Global Investment Income

Tax residents trading foreign stocks or holding offshore accounts are being put on notice as authorities take fuller advantage of cross-border data to trace unreported earnings

Tax residents trading foreign stocks or holding offshore accounts are being put on notice as authorities take fuller advantage of cross-border data to trace unreported earnings. Photo: AI generated

Liu Mo, an investor from the central Chinese city of Wuhan, was recently contacted by his local tax office. After actively trading U.S. stocks through platforms such as Futu and Tiger Brokers in recent years, he received a text message, a tax app alert and a follow-up phone call this month, urging him to review whether he had reported his overseas income dating back to 2021.

Liu’s case reflects a broader development: Many Chinese residents have recently received reminders from local tax authorities that income from overseas investments is subject to China’s global income tax rules. While the legal requirement has existed for decades, enforcement efforts have become more visible over the past year as cross-border coordination and access to data have improved.