It is necessary to withhold personal income tax.
Regulations on the Implementation of the Individual Income Tax Law of the People's Republic of China:
Article 8 on the definition of income from wages and salaries refers to wages, salaries, bonuses, year-end raises, labor bonuses, allowances, subsidies, and other incomes derived by an individual in connection with his office or employment.
Article 10 stipulates the forms of individual income, including cash, in-kind, marketable securities and other forms of economic benefits.
The taxpayers of individual income tax include both resident and non-resident taxpayers. Resident taxpayers are fully liable to pay tax and must pay individual income tax on all their income derived from within and outside China, while non-resident taxpayers pay individual income tax only on their income derived from within China.
Expanded Information:
Individual Income Tax :
A tax levied on natural persons (both residents and non-residents) in respect of their personal income. China's Individual Income Tax Law stipulates that all individuals who have resided in China for one year or more shall pay individual income tax on income derived from both within and outside China, which is an application of the jurisdiction of the place of residence for taxation purposes;
Individuals who do not reside in China or who have resided in China for less than one year shall be taxed on the income derived from within the territory of China, which is an application of the jurisdiction of the place of source of income for taxation purposes.
China's individual income tax adopts a categorical income tax system, and its taxable items are: income from wages and salaries, income from remuneration for labor services, income from royalties; income from interest, dividends and bonuses, income from property leasing, and other income.
Expanded Source: Baidu Encyclopedia - Income Tax