How is crypto taxed in China?

China crypto tax rules are unsettled because mainland China treats crypto trading as illegal financial activity. No national tax law or circular deals directly with bitcoin or similar coins, as of October 2026. The closest guidance is a 2008 reply from the State Taxation Administration (STA) on virtual currency, written before bitcoin existed.

What is the China crypto tax rate?

There is no official crypto rate. On September 28, 2008, the STA replied to Beijing's tax bureau that an individual who buys online virtual currency and resells it at a higher price has taxable income under the category of property transfer income, according to a 2025 analysis by lawyer Liu Zhengyao on TechFlow. The consultancy Ecovis summarizes the same reply. The gain is the sale price minus the purchase price and related taxes and fees, and if the seller cannot prove the cost, the tax authority sets it.

PwC's tax summary lists a flat 20% rate for the remaining income categories, including capital gains, and says property gains are worked out as proceeds minus cost and reasonable expenses. Wages and similar income are taxed separately at progressive rates from 3% to 45%. PwC also says tax residents are generally taxed on worldwide income.

How is crypto trading tax in China treated under the ban?

This is the hard part. Liu notes that the 2008 reply targeted centralized tokens such as QQ Coins, not decentralized crypto. He argues that taxing banned speculation sits awkwardly with the trading ban, though local bureaus may still ask for tax, especially when money reaches domestic bank accounts.

Officials have not settled the question in public. In January 2024 the Shanghai tax service posted an explainer that cited the 2008 reply in a discussion of digital currency transactions, then deleted it within days after it spread online, the South China Morning Post reported. A March 2025 tax notice in Zhejiang was widely linked to crypto profits, but Liu says no official source confirmed that link.

Is cryptocurrency legal in China?

Trading and running crypto businesses are banned on the mainland under rules set out in 2021 and restated in February 2026. A Shanghai judge has written that simply holding crypto is not illegal for individuals. The details are in is crypto legal in China.

Does the mainland approach apply to Hong Kong?

No. Hong Kong has its own tax system and no capital gains tax, and it looks at whether crypto is held as an investment or traded as a business. That is covered in how crypto is taxed in Hong Kong. For other countries, see crypto tax around the world.

Rules differ by country and change often. Check the tax authority or a qualified professional for your own situation.