Payroll and Benefits Guide - China

China
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Currency

Chinese Yuan
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Capital

Beijing
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Employer Taxes

39.50 – 41.20%
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Date Format

yyyy/mm/dd
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Fiscal Year

1 Jan – 31 Dec

Fun Facts

Important inventions like paper, the original printing technologies, tea, and gunpowder are some of China’s contributions to the world.

Being the largest exporter and second largest importer, the republic boasts a prospering and growing economy.

Part of the Qinghai-Tibet Railway, the highest railway in the world is found in China.

The Silk Road network of trade routes starts in China.

95% of the world’s pandas are owned by China.

Home of the Forbidden City, the biggest palace compound globally

China

Contributions

Employee Payroll Tax

Housing Fund (could be higher depending on city)12.00%
Pension8.00%
Medical Insurance2.00%
Unemployment Insurance0.50%

Employer Payroll Tax

Employer Pension16.00%

Housing Fund (could be higher depending on city)12.00%
Employer Medical Insurance9.00%
Employer Work-related Injury Insurance0.20-1.90%
Employer Unemployment Insurance1.50%
Employer Maternity Insurance0.80%

Payroll

Payroll Cycle

China has a standard monthly cycle with pay given on the final working day.

13th Salary

While China’s law requires a 13th-month salary, the country’s culture encourages an additional 14th-month salary relying on employment contract clauses.

Work Hours and Week

The country works on a regular 45-hour Monday-Friday work week with a eight-hour minimum workday.

Overtime

Employees can have overtime of up to 3 hours a day with a 36-hour cap per month. This work is paid at 150% rate. If it is done on a weekend or a holiday, it is paid at a 200% or 300% rate respectively.
China

Leave

Paid Time Off

For a minimum of 5 days paid time off, an employee must first render at least a year of service. This could increase up to a maximum of 15 days depending on length of service.

Public Holidays

There are 11 public holidays.

Sick Days

The amount and rates of paid sick leave an employee may have depends on the region, length, and conditions of employment. The amount ranges from 3 to 24 months while the rates ranges from 40.00% to 100% of the regular pay.

Maternity Leave

All pregnant employees are granted a standard 98-day leave starting 15 days before the due date. However, different provinces could have longer maternity leaves extending up to 190 days.

Paternity Leave

Most areas in China have 15-day paternity leave, but in some areas it could range from 7 days to 30 days.

Parental Leave

Parents are given 5-15 days of paid parental leave per year depending on the region of employment.

Other Leave(S)

Employees are given up to three days of paid time off in the event of a death of an immediate relative.

When an employee gets married, they may have up to ten days of paid leave.

Termination

Termination Process

The process varies depending on the type of contract, work role, locality, and reason for termination, as well as the employment agreement and Collective Agreement being enforced.

Notice Period

The usual notice period in China, but in the case of a notice not being issued, a payment equivalent to 30 days of pay is to be given.

Severance Pay

Employees who are let go from their employment are entitled at least half a month’s pay regardless of the duration of one’s service.

Probation Period

Probation Period

In the case of fixed term contracts, a probationary period of up to 2 months is given. With indefinite contracts, it could be up to 6 months.

Immigration

The local employer in China is responsible for their new employees visas. These visas also have an age limit. For male employees, it is 24-65 years old while for female employees, it is 24-55 years old.

VAT

The commonly used standard rate of VAT in China is 13.00%