Note: As more high-net-worth families move overseas, the lawful and efficient handling of financial assets remaining in China has become an unavoidable issue. This article reviews cross-border treatment of insurance proceeds, bank deposits, securities investments and fund interests, helping families achieve a smooth transition when their identity changes.
01 Cross-border transfer of insurance proceeds
Under Article 13 of the Measures for the Administration of Individual Foreign Exchange, lawful RMB income from current-account transactions obtained in China by an overseas individual may be converted and remitted through a bank upon presentation of valid identity documents and supporting materials.
1.1 Proceeds payable to an overseas individual
Where the beneficiary has moved overseas and needs to remit insurance proceeds from China, the proceeds will generally constitute lawful current-account income and may be converted and remitted in accordance with the rules.
Procedure:
- Provide the original and a copy of the insurance policy;
- Submit the beneficiary’s overseas identity documents;
- Provide the insurer’s claim-payment certificate;
- Complete the bank’s foreign-exchange purchase application; and
- Remit the funds to the beneficiary’s overseas account.
1.2 Proceeds from a large whole-life policy
Large whole-life insurance proceeds may be subject to additional review.
Points to note:
- Provide the complete policy and all attachments;
- Prove the relationship between the beneficiary and the insured;
- Submit the beneficiary’s overseas bank-account information;
- Provide an explanation of the source of funds if required; and
- Obtain special approval from the foreign-exchange authority where required for a large claim.
02 Cross-border transfer of bank deposits
After immigration, many families are concerned with how to lawfully transfer bank deposits in China overseas.
2.1 Lawful current-account income
Lawful income such as salary, bonuses and royalties may be converted and remitted through a bank upon presentation of valid identity documents and supporting materials.
Procedure:
- Provide documents proving the income;
- Submit tax-payment certificates;
- Complete the bank’s foreign-exchange purchase application; and
- Remit the funds to the individual’s overseas account.
2.2 Capital-account funds
Proceeds from an equity transfer or sale of real estate are capital-account funds and must be handled under the Interim Measures for the Administration of the Sale and Payment of Foreign Exchange for the Transfer of Personal Property Abroad.
Points to note:
- The applicant must apply at one time for the full amount of property proposed to be transferred;
- The first remittance may not exceed half of the total amount approved;
- After one year from the first remittance, no more than half of the remaining amount may be remitted; and
- After two years from the first remittance, all remaining funds may be remitted.
03 Securities investments and fund interests
The treatment of domestic securities and fund interests after immigration must comply with the relevant rules.
3.1 Securities accounts
Under the applicable rules, an overseas individual opening a securities account in China must satisfy certain conditions.
Practical suggestions:
- Before immigration, assess whether domestic securities should continue to be held;
- If a transfer is required, complete the securities-transfer procedures; and
- Ensure that any remittance of proceeds complies with foreign-exchange rules.
3.2 Fund interests
The treatment of domestic fund interests is similar to that of securities.
Practical suggestions:
- Assess liquidity and redemption conditions;
- Complete redemption procedures under the fund company’s rules; and
- Ensure that the remittance of redemption proceeds complies with foreign-exchange rules.
04 Other financial assets
Other financial assets, including trusts and wealth-management products, must also be handled according to their specific features.
Practical suggestions:
- Understand the liquidity and exit mechanisms of each financial asset;
- Assess tax and foreign-exchange implications; and
- Seek assistance from professional advisers where necessary.
Conclusion: Systematic planning and professional implementation
Planning for assets after immigration is a forward-looking systematic project involving identity planning, asset allocation, tax planning and structural design. Families considering immigration should:
- Plan early: begin planning at least one to two years in advance rather than reacting at the last minute;
- Implement in stages: arrange asset transfers in stages in light of foreign-exchange policies and the asset position;
- Obtain professional advice: engage a professional team to design an integrated, compliant plan; and
- Monitor developments: follow policy changes closely and adjust the asset-allocation strategy in time.
Every decision during immigration may have long-term consequences. Like a Go strategy, the plan must consider the board as a whole. Only systematic planning and professional execution can ensure that each move is made with confidence.
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Disclaimer: This article is for general information only and is intended to help readers understand common issues and compliant routes for handling assets after immigration. It does not constitute legal, tax, financial or investment advice in any jurisdiction. Specific arrangements should be based on individual circumstances and implemented with professional guidance. If laws or policies change, the latest official releases shall prevail.
This article is general information and not legal advice. Specific matters require assessment by appropriately qualified professionals.