Source: Forex Spy +
Original: FX007
The spy previously shared their experience of being required to pay taxes on U.S. stock trading; see the previous article (Overseas investments have started paying taxes!). By June 30, I had completed my back taxes, paying taxes on 'capital gains' for the years 2022, 2023, and 2024, meaning that for each year with profits, a 20% tax must be paid, while losses cannot offset profits in the following year.
Today, after seeing a netizen's case, I realized that even trading USDT can be detected, and they had to pay back 20% tax. Now everyone must be more cautious when using overseas bank cards and investment accounts.
A person from Zhejiang was required to pay back taxes of 127,200 yuan on their annual net income of 636,000 yuan from trading USDT and other virtual currencies through overseas platforms. This regulatory storm triggered by CRS information exchange and the fourth phase of the Golden Tax system is spreading from high-net-worth individuals to middle-class investors — your U.S. stock accounts, Hong Kong insurance policies, overseas real estate, and overseas investment income may all be on the tax radar.
This year, tax audits have broken the traditional model of 'only auditing billionaires,' and middle-class investors with assets between 100,000 and 1 million yuan have become the main targets. For example, a person from Shandong traded U.S. stocks through a Hong Kong brokerage, with unreported dividends and capital gains totaling 800,000 yuan, ultimately paying a total of 1,263,800 yuan including late fees (Source: Official announcement from the Shandong Provincial Taxation Bureau on March 26, 2025).
Typical high-risk scenarios:
1. Overseas securities trading: including U.S. stocks, Hong Kong stocks, virtual currencies, and high-frequency trading.
A citizen from Wuhan traded U.S. stocks worth 15 million dollars through Tiger Brokers from 2021 to 2024, and although the account ultimately only had a few thousand dollars left, they were still required to self-check.
A person from Zhejiang traded USDT and other virtual currencies through overseas platforms, with an annual net income of 636,000 yuan that was unreported, and paid back taxes of 127,200 yuan under 'capital gains.'
2. Dividends from offshore companies: A person held Luckin Coffee stock and received annual dividends of 100,000 yuan, paying back taxes of 20,000 yuan under the 'Controlled Foreign Corporation' rules.
3. Cross-border labor remuneration: A consultant from Shanghai was required to pay back individual income tax of about 256,000 yuan (including late fees) for unreported labor remuneration of 800,000 yuan from Singapore.
It is particularly important to note that if you have overseas income that you have not actively declared, you will incur late fees each year. This fee is quite high, calculated daily, with a daily interest rate of 0.05% of the unpaid tax (equivalent to an annualized rate of 18.25%).
For example, if you have not paid 10,000 yuan of overseas individual income tax this year, after a year, the late fee would be 1,825 yuan. So everyone should actively self-check.
Under the regulatory framework woven by CRS and the fourth phase of the Golden Tax system, the era of overseas income being unreported has ended. Actively embracing transparency rules is the ultimate 'firewall' against tax risks.
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