The short answer
A clean exit closes six things, in this order:
- The final payroll — last month’s salary, unused leave, severance if any, taxed in the month it is paid.
- The work permit — cancelled by the employer within 10 working days of the employment ending.
- The residence permit — falls with the work permit; leave or change status within the window the exit-entry administration allows.
- The tax position — the final withholding, plus the annual reconciliation if the employee is a resident.
- The money — housing fund balance and the pension individual account.
- The bank — closing the account, or remitting the balance with the documentation the bank asks for.
Most of the pain comes from doing 4, 5 and 6 after 2 and 3. Once the work permit is cancelled, the clock on lawful stay is running, and the housing fund and pension offices want to see the permit status.
The final payroll is a tax event
The last salary is not just arithmetic. It is paid in a month when the employee may be a resident and may be leaving, and the two positions produce different filings.
| Situation | Filing |
|---|---|
| Non-resident (fewer than 183 days in the year) | Monthly withholding; settle any unsettled income before departure |
| Resident leaving mid-year | Annual reconciliation for the part-year, filed before departure or by a representative afterwards |
| Resident staying to year end | Normal monthly withholding, reconciliation the following March to June |
Two items are usually missed. Unused annual leave paid out in cash is salary and taxable. And the annual reconciliation is where a refund usually sits — a resident who leaves in June and never files gives it up.
Severance follows its own rule: the portion within three times the local average annual wage is exempt, the excess is taxed separately. That calculation is done by the employer, but the employee should check it, because it is rarely revisited.
Cancelling the permit, and the 30 days
The employer files the cancellation and returns the permit card. From that point the residence permit has no supporting employment, and the exit-entry administration will either cancel it or allow a short period to change status.
Changing status means a different basis for stay: a dependant permit if the spouse still works in China, a study permit, or a new work permit if another employer has already filed. The last of these is the one that goes wrong — the new employer’s application has to be timed so that the old permit is cancelled and the new one issued without a gap. The employer-change guide covers that sequence.
If the plan is simply to leave, book the flight inside the window, keep the cancellation receipt, and do not assume the residence permit remains valid because the card has not been collected.
The money: housing fund and pension
Housing fund. The balance is both contributions plus interest, and it is withdrawable on departure or on cancellation of the residence permit in most cities. The file is passport, cancellation evidence, and a bank account; some cities require the account to be closed in person, so this is a “do it before the flight” item, not an “email it later” item.
Pension. The individual account — the 8% the employee contributed — can usually be withdrawn as a lump sum when leaving, because it cannot be paid as a pension outside China. The employer’s 16% goes into the pooled fund and is not refundable. Procedures differ: some cities pay only after the account is closed and the departure is documented, and payment to a foreign bank account may need the bank’s own review.
Medical insurance. The personal account balance is usable while the permit is valid and is generally not refundable; spend it or accept the loss.
The bank, and moving the money out
Salaries remitted abroad are current-account items, but a bank handling a large final payment after the employment has ended will ask why. Keep the labour contract, the cancellation evidence, the final payslip and the tax withholding record together. For larger payments the bank may require tax filing evidence under the foreign-exchange rules, and it is the bank — not the tax office — that decides what it will accept.
Close or keep the account deliberately. A dormant Chinese account with a foreign passport as ID is hard to reactivate years later, and it is easier to empty and close it while the permit is still valid.
Where exits go wrong
- The flight is booked before the cancellation is filed. The permit record stays open, and the next application has to explain it.
- The reconciliation is forgotten. Residents leaving mid-year lose refunds and leave an open filing year.
- The housing fund is left behind. It is real money, and it becomes much harder to claim once the permit is cancelled and the person is abroad.
- The final month is paid “net” without withholding. The employer carries the liability, and the employee’s record shows an unexplained gap.
- The tax residency position is ignored. A person who spent 200 days in China and leaves in December is a resident, and the year needs a resident filing.
Start four to six weeks before the last working day: payroll, permit, permit-linked accounts, then the bank. The social insurance and tax guide explains the contributions being closed, the work permit page covers the permit file, and the employer-change guide covers the case where the next job is also in China. To have an exit sequence mapped before notice is given, contact an advisor.