Notice on Individual Income Tax on the Work-related Injury Insurance
The State Administration of Taxation has issued the Notice regarding the Policy of the Individual Income Tax on the Work-related Injury Insurance Treatment (the “Notice”) on May 3rd, 2012, which has retroactively become effective as of January 1st, 2011.
According to the Notice, the work-related injury insurance, which is obtained by the injured employee or his/her relatives according to the ´Regulations of the Work-related Injury Insurance´, is exempted from the individual income tax.
The above-mentioned work-related injury insurance, according to the Regulations of the Work-related Injury Insurance, includes the one-off pension, disability allowance, one-off work-related injury medical pension, one-off disability employment pension, work-related medical treatment, hospital food subsidy, out-of-town medical transportation and accommodation expenses, work-related recovery expenses and nursery expenses obtained by the injury employee, as well as the funeral pension, dependent relative pension and one-off work-related death pension obtained by the employee’s relatives due to the employee’s work-related death.
Due to the fact that the Notice has become retroactively effective as of January 1st, 2011, if the employee or his/her relatives have already paid the individual income tax of the work-related injury insurance, they can apply for the refund of the individual income tax at the competent tax authority.