Macau residents working in the Hengqin Guangdong-Macao In-Depth Cooperation Zone, along with high-end and in-demand talent recruited into the zone, can continue claiming preferential individual income tax (IIT) treatment for two more years. China’s Ministry of Finance and State Taxation Administration confirmed on 12 January 2026 that the zone’s IIT concessions, due to lapse at the end of 2025, now run through to 31 December 2027.
Who qualifies and what changes
The extension covers two groups. Domestic and overseas high-end and in-demand talent working in the zone can have the portion of their IIT burden exceeding 15% exempted. Macau residents working in Hengqin can separately have the portion of their IIT burden exceeding their Macau tax burden exempted, effectively aligning their tax burden with what they would pay in Macau.
Both concessions apply to comprehensive income, covering wages, salaries, labour remuneration, author’s remuneration and royalties, as well as business income and government-recognised talent subsidies, provided the income is sourced from within the Hengqin zone.
Impact on Macau businesses and cross-border workers
The extension removes near term uncertainty around one of Hengqin’s key incentives, giving Macau based companies considering a presence in the zone a further two years to plan hiring and relocation decisions. For Macau residents already working or considering work across the border, the extension means the tax parity with Macau continues without interruption, removing a planning risk created by the previous framework’s 2025 expiry.
The zone’s separate 15% preferential corporate income tax rate for qualifying enterprises remains unaffected by this extension. Businesses considering a Hengqin presence continue to have access to both individual and corporate tax concessions, though the two are governed by separate rules and timelines.
Next steps for businesses and individuals
Companies and individuals should confirm their eligibility against the zone’s list-based management system, which requires talent to be included in an approved list before the concession applies. Given the criteria for high-end status and industry qualification can be detailed, businesses structuring a Hengqin presence or relocating staff are best placed to consult an expert on how the extended policy applies to their specific circumstances.
