Recorded 26 August 2026

For a long time the offshore trust was sold to China-connected families as a Swiss Army knife: one structure for tax, succession, insurance, investment and family governance. In July 2026 China's Ministry of Finance and State Taxation Administration issued Announcements No. 21 and No. 15, which set out how resident individuals are taxed on offshore trusts.

Harry Yu 余亮恒, Senior Partner, Fung Yu Trust Services (Hong Kong) Limited, argues that the announcements are about more than tax. They mark a broader change in Chinese private wealth, from creating wealth to building institutions that can hold it across generations. Harry joins us on the podcast to discuss these developments. We discuss where Chinese wealth came from and why it went offshore. We also cover the new "resident contributor" concept, why old trusts now face an evidence problem, what families may do in response to these developments, and why "the job comes before the tool".

Harry has worked between mainland China and Hong Kong for more than two decades. He advises China-connected entrepreneurial families on offshore trusts, succession, family governance and cross-border structures. He is a member of the Society of Trust and Estate Practitioners (STEP) and sits on the steering committee of STEP's Cross-Border Estates Global Special Interest Group. He is also an Honorary Institute Fellow at the Asia-Pacific Institute of Business, CUHK Business School.

You can find out more about Harry, his work, and his newsletter HK Structuring Insights”, at https://www.linkedin.com/newsletters/hk-structuring-insights-7336608285988438016/ and his LinkedIn profile https://www.linkedin.com/in/yuharry/

China Tax Announcements - MOF/STA Announcement No. 21 (2026) https://fgk.chinatax.gov.cn/zcfgk/c102416/c5251277/content.html the substantive individual income tax framework for offshore trusts - STA Announcement No. 15 (2026) https://fgk.chinatax.gov.cn/zcfgk/c100012/c5251338/content.html filing, reporting and administration - STA official interpretation https://fgk.chinatax.gov.cn/zcfgk/c100015/c5251326/content.html “As at 20 October 2026, the 90-day transitional period for certain historical offshore-trust tax liabilities is drawing to a close. The State Taxation Administration’s 19 October reminder calls for the relevant filing and tax payment to be completed before 22 October 2026 to benefit from relief from late-payment surcharges.”

Official STA reminder https://www.chinatax.gov.cn/chinatax/n810214/c102374/c102375d/c5253047/content.html Further reading - Lusina Ho, "Family trusts for Chinese clients" (2014) Trusts & Trustees, https://doi.org/10.1093/tandt/ttt223 - Zaif Hassan Fazal, "Taxation of Offshore Trusts and the Rule of Law: The Case of Australia and China" (2022) Trusts & Trustees, https://doi.org/10.1093/tandt/ttac089