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Bill Longstreet

How Do I Transfer My RMB Back Home?

Posted on May 6, 2014 Facebooktwittergoogle_pluspinterestlinkedinrss

This article was first published in Talk magazine Shanghai on May 14, 2014 edition.


China lays claim to inventing many things, but one of the most believable is the claim they invented bureaucracy. It’s everywhere. Consider how hard it is to do a simple thing such as moving your hard earned savings home, or just into a foreign currency. The difficulty stems from the fact that China has very stiff currency controls. At Caterer Goodman we face this issue regularly, both for ourselves and our clients, and I cannot say there is one simple way to do it. But there are a few ways that are less painful and useful than others, so let’s
talk you through some of the best options.
Fortunately for all expatriates, as long as you have paid taxes on your income, Chinese banks are happy to help you exchange your RMB to foreign currency and then to transfer it to a bank of your choosing. The cumbersome part is gathering all of the documentation necessary to make the conversion from RMB to your preferred foreign currency. Tip: You’ll get the best rates exchanging to USD.
The hard part is locating your income tax receipts. These should have been mailed to you at least once a year. If you don’t have them, ask your HR department. If they are of no help, you will need to visit your local tax bureau, so ask HR for the address. As long as you bring your passport along, they should be able to quickly print them out at no cost to you, except for your time of course.
Once you obtain your receipts, bring them along with your passport, alien working permit, employment contract,
a recent pay slip and a blood sample (kidding of course), and the bank will be happy to exchange and transfer as much of your savings as your tax receipts cover. Tip: Some Chinese banks claim that tax receipts are only valid for 12 months, but foreign banks tend to accept several years’ worth. Tip 2: Call ahead to your bank and see which particular branch specialises in currency exchange as not all do.
If you only need a small amount of foreign currency, say $500, banks should be able to make this exchange with no supporting documents beyond your passport. I heard a rumour that this is a per branch limit, so if you have some time to kill and really need foreign currency you can spend the day touring bank branches. Personally I’d rather pluck my eyebrows with a hedge-clipper, but you could be more motivated. Tactically speaking, I would start with the banks in the heritage buildings on the Bund, at least you will have something interesting to look at while you are in line.

Having lived in China for over 20 years, I have heard stories of “alternative” ways to convert money, which I wouldn’t dream of recommending to you, but do, I’m told, exist. There is always the friendly neighbourhood money changer, who can be found at most bank branches. He’s usually the guy with a fanny pack sitting in the bank waiting area, or standing just outside and whose ticket number never gets called. You can always ask your Chinese friends to convert your RMB, as they are able to convert up to $50,000 USD per year, but if you deposit the foreign currency back into your Chinese account and transfer it out of the country, you will probably be hit with a small tax. You will also need a trustworthy friend… Don’t risk buying and then smuggling gold or diamonds out since Chinese customs is getting wise to this method and has chalked up a few arrests in recent times. It could have very nasty consequences, and a tax rate of 100% on their collections is pretty high. Lastly, and in better news, if you are flying to Hong Kong, you can legally carry up to RMB 20,000 and exchange it there when you arrive.


Ah, just the mention of Hong Kong and it’s lack of inane rules is enough to put a smile on my face. Sometimes, little fishing villages without much in the way of bureaucracy and rules can do amazing things. Still for our money, the paperwork approach is best and most powerful method, at least until those fishing villages outside Shanghai (sorry ‘Free Trade Zones’) develop properly. That’s an historical roll-back of bureaucracy to look forward to.
1405ST-Money Talk
Bill Longstreet has been a financial advisor since 2003 and prior to this were a institutional business development director, specializing in fixed income and foreign exchange markets. Bill has a Master in Business Administration with a concentration in Finance (1999) from the Olin School of Business at Washington University in St. Louis and am a candidate for the CFP (Certificate Financial Planner) qualification. He also holds a Bachelor of Arts with a Major in Economics from Denison University. In his last position before joint Caterer Goodman oversaw $350 million in client funds across a range of currencies and risks profiles.
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