European Insurance News & Views: China tax rules offshore trusts – Pru read-across

Research evidence excerpt

European Insurance News & Views: China tax rules offshore trusts – Pru read-across

Global Research

27 July 2026ab

European Insurance News & Views Equities

Europe including UKChina tax rules offshore trusts – Pru read-across

Financial

Nasib Ahmed, FIA

Headline: China tax rules offshore trusts – Pru read-across Analyst

nasib-za.ahmed@ubs.com

China has begun official enforcement of its tax rules on offshore trusts (see here). +44-20-7568 8231

According to the SCMP, these structures have historically been used by the wealthy in Will Hardcastle, CFA

China to potentially avoid taxation. Analyst

will.hardcastle@ubs.com

+44-20-7567 9763

UBS Summary:

Qian Lu

Analyst

China has been targeting offshore trusts since 2025 and the statement on Friday is an qian-za.lu@ubs.com

official enforcement to capture revenues from wealth its citizens hold overseas. Income +44-20-7567 4657

from these trusts will be taxed annually at 20%, with sweeping anti-avoidance

Chloe Ryan

provisions. For example, those individuals who become foreign citizens or overseas Associate Analyst

permanent residents but still retain economic interests in China may still be treated as chloe.ryan@ubs.com

Chinese tax residents. Unpaid taxes on assets within trusts since Jan 2023 must be +44-20-7567 3505

settled within 90 days.

We do not see immediate read-across for Pru's Mainland Chinese insurance business,

where we expect the majority to be savings products. All life insurance benefits,

including death benefits, surrender values, and non-guaranteed bonuses, are paid tax-

free within HK; therefore, the MCV products are currently not subject to tax. However,

we note that tax avoidance is not a key reason for buying insurance savings products,