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Payroll and Benefits Guide China

Last updated: May 03, 2023

Currency
Chinese Yuan (CNY)
Employer Taxes
39.50% - 41.20%
Payroll Frequency
Monthly
Employee Costs
22.5%
Capital
Beijing
Date Format
yyyy/mm/dd
Fiscal Year
1 January - 31 December
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Contribution

Employer
Employer Payroll Contributions
Beijing:
Employer Payroll Contributions
16.00%
Employer Pension (maximum monthly salary base, 33,891 CNY)
0.50%
Employer Unemployment Insurance (maximum monthly salary base, 33,891 CNY)
9.80%
Employer Medical Insurance (maximum monthly salary base, 33,891 CNY)
0.20% to 1.90%
Employer Work-related Injury Insurance (dependent upon type of work being carried out) (maximum monthly salary base, 33,891CNY)
5.00%-12.00%
Housing Fund (in some cities excess of 12% is allowed)
31.50% – 40.20%
Total Employer Cost
Beijing:
Employee Payroll Contributions
8.00%
Pension (maximum monthly salary base, 33,891CNY)
0.50%
Unemployment Insurance (maximum monthly salary base, 33,891CNY)
2.00%
Medical Insurance (maximum monthly salary base, 33,891CNY)
5.00%-12.00%
Housing Fund (in some cities excess of 12% is allowed)
15.5%-22.50%
Total Employee Cost
Shanghai:
Employer Payroll Contributions
16.00%
Employer Pension (maximum monthly salary base, 36,549 CNY)
0.50%
Employer Unemployment Insurance (maximum monthly salary base, 36,549 CNY)
10.00%
Employer Medical Insurances (maximum monthly salary base, 36,549 CNY)
0.16% to 1.52%
Employer Work-related Injury Insurance (dependent upon type of work being carried out) (maximum monthly salary base, 36,549 CNY)
1.00%
Employer Maternity Insurance (maternity insurance has been merged into medical insurance in many cities (maximum monthly salary base, 36,549 CNY)
5.00%-12.00%
Housing Fund (in some cities excess of 12% is allowed)
32.66% – 41.02%
Total Employer Cost
Shanghai:
Employee Payroll Contributions
8.00%
Pension (maximum monthly salary base, 36,549 CNY)
0.50%
Unemployment Insurance (maximum monthly salary base, 36,549 CNY)
2.00%
Medical Insurance (maximum monthly salary base, 36,549 CNY)
5.00%-12.00%
Housing Fund (in some cities excess of 12% is allowed)
15.50%-22.5%
Total Employee Cost
Guangzhou:
Employer Payroll Contributions
14.00%
Employer Pension (maximum monthly salary base, 26,421 CNY)
0.80%
Employer Unemployment Insurance (maximum monthly salary base, 38,082 CNY)
6.85%
Employer Medical Insurance (maximum monthly salary base, 28,368 CNY)
0.20% to 1.40%
Employer Work-related Injury Insurance (dependent upon type of work being carried out)
5.00%-12.00%
Housing Fund (in some cities excess of 12% is allowed)
26.85% – 35.05%
Total Employer Cost
Guangzhou:
Employee Payroll Contributions
8.00%
Pension (maximum monthly salary base, 26,421 CNY)
0.20%
Unemployment Insurance (maximum monthly salary base, 38,082CNY)
2.00%
Medical Insurance (maximum monthly salary base, 28,368 CNY)
5.00%- 12.00%
Housing Fund (in some cities excess of 12% is allowed)
15.2%-22.20%
Total Employee Cost
 China
Employee Income Tax
3.00%
Up to 36,000 CNY
10.00%
36,001- 144,000 CNY
20.00%
144,001- 300,000 CNY
25.00%
300,001- 420,000 CNY
30.00%
420,001- 660,000 CNY
35.00%
660,001- 960,000 CNY
45.00%
960,001 CNY and above

Private Pension Reform

The pilot phase of the new private pension scheme was officially launched in November 2022 in 36 cities and is initially set to last a year before being implemented at a wider scale. The first batch of eligible cities include Beijing, Shanghai, Guangzhou, Tianjin, Shenzhen, Hangzhou, and Chengdu. The Chinese government has not yet determined when the implementation will be expanded to cover all cities in China.

Participation in the private pension plan will be open to all Chinese citizens and resident workers who currently contribute to the basic pension insurance for urban employees or the basic pension insurance for urban and rural residents.

Participants will be allowed to make voluntary contributions of up to RMB 12,000 per year into their individual pension accounts.

Employer taxes

Highest
Lowest

Employee taxes

Highest
Lowest

Minimum Wage

General

The National minimum wage in China differs per region; the most common minimums include 2,320 CNY in Beijing, and 2,590 CNY in Shanghai.

MINIMUM WAGE (PER MONTH)

Highest
Lowest

Payroll

Payroll Cycle

The payroll cycle in China is generally monthly, and payments are made on the last working day.

13th Salary

In China, it is customary to pay a 13th-month or even 14th-month salary during the month of the Lunar New Year or Spring Holiday. This will be stipulated within the employment contract.

Authority Payments

Authority Payment Frequency Methods
Tax office Monthly, 15th of following month Bank transfer
RMB
Social insurance office Monthly, end of the month Bank transfer
RMB
Housing fund office Monthly, end of the month Bank transfer
RMB

Working Hours

General

Standard working hours within China are 8 hours per day, 40 hours per week, up to a maximum number of 45 working hours per week.

Overtime

All work above the standard weekly working hours is paid as overtime and regulated by employment contract/collective agreements. In general, no more than one hour of overtime a day is permitted except in exceptional circumstances. Overtime can increase to 3 hours a day with a maximum for the month of 36 hours.
Overtime is paid at 150.00% of the standard salary rate for weekday work, increasing to 200.00% for weekends and 300% salary on public holidays. This applies to all roles including management level.

Leave

Annual Leave (vacation)

Paid leave in China is set in the employment contract and is dependent upon the years of employment. Paid leave is in addition to all public holidays.

For an employee within the first year of employment, there is no entitlement for paid annual leave. However, after completing the first year up to the tenth year, the employee is entitled to 5 days of paid leave. This increases to 10 days for employees within 10 to 20 years of service and a maximum of 15 days paid leave for employees who have completed 20 years’ service or more.

Public Holidays

There are 11 yearly public holidays, however, some regions have additional holidays.

Working on public holidays is uncommon in China, but if an employee is required to work the overtime payment is generally paid at 300% of the hourly rate. The hourly rate is calculated by using the monthly salary rate for the employee divided by 174 (average number of working hours in a month).

In China, public holidays are sometimes moved to create an extended holiday period.

Date Day Holiday Notes
1 Jan 2024 Monday New year´s Eve
10 Feb 2024 Saturday Lunar New Year
11 Feb 2024 Sunday Spring Festival
12 Feb 2024 Monday Spring Festival
13 Feb 2024 Tuesday Spring Festival
14 Feb 2024 Wednesday Spring Festival
15 Feb 2024 Thursday Spring Festival
16 Feb 2024 Friday Spring Festival
17 Feb 2024 Saturday Spring Festival
8 Mar 2024 Friday International Women’s Day A common but not mandatory half day off for women only
4 Apr 2024 Thursday Qing Ming Jie
5 Apr 2024 Friday Qing Ming Jie Holiday
6 Apr 2024 Saturday Qing Ming Jie Holiday
1 May 2024 Wednesday International Labor Day
2 May 2024 Thursday Labour Day Holiday
3 May 2024 Friday Labour Day Holiday
4 May 2024 Saturday Labour Day Holiday
5 May 2024 Sunday Labour Day Holiday
10 Jun 2024 Monday Dragon Boat Festival
15 Sep 2024 Sunday Mid-Autumn Festival Holiday
16 Sep 2024 Monday Mid-Autumn Festival Holiday
17 Sep 2024 Tuesday Mid-Autumn Festival
1 Oct 2024 Tuesday National Day
2 Oct 2024 Wednesday National Day
3 Oct 2024 Thursday National Day
4 Oct 2024 Friday National Day
5 Oct 2024 Saturday National Day

Sick Days

Sick pay in China is outlined in the employment contract and depends on the years of employment, the actual amount of sick leave, and the provision of a professional medical certificate. Some of the regulations regarding the calculation for sick pay are made at a local level, e.g., there are differences between Shanghai and Beijing. However, in general, the process is as follows:

The amount of paid sick leave entitlement is based on the number of years of service.

  • Less than five years entitles the employee to 3 months of sick leave
  • 5 – 10 years’ service entitles the employee to between 6 to 9 months of sick leave (region-specific)
  • 10 – 15 years’ service entitles the employee to between 12 to 18 months of sick leave (region-specific)
  • 15 – 20 years’ service entitles the employee to 18 months, and more than 20 years of service entitles the employee to up to 24 months of sick leave

The entitlement for sick pay is also based on the number of years’ service; for sick leave of fewer than six months, the calculation is as follows:

  • Less than two years of employment – 60.00% of the regular wages
  • 2-4 years of employment – 70.00% of the regular wages
  • 4-6 years of employment – 80.00% of the regular wages
  • 6-8 years of employment – 90.00% of the regular wages
  • 8+ years of employment – 100.00% of the regular wages

The entitlement for sick pay is also based on the number of years of service for sick leave of more than six months in length; the calculation is as follows:

  • Less than 1 year of employment – 40.00% of the regular wages
  • 1-3 years of employment – 50.00% of the regular wages
  • 3+ years of employment – 60.00% of the regular wages

Maternity Leave

Female employees are entitled to basic Maternity leave of 98 days, which can be taken from 15 days prior to the expected date of childbirth. Each individual province also has entitlement to extended maternity leave, up to a total maternity leave period of:

  • Chongqing, Guangdong – 178 days
  •  Tianjin – 128 days
  • Henan, Hainan – 190 days
  • Jiangxi, Hebei (for the third child), Zhejiang (for the third child) – 188 days
  • Gansu, Heilongjiang, Fujian – 180 days
  • Guangxi – 148 days
  • Jiangsu – 128 days:
  • Other regions (including Beijing) – 158 days

The calculation of the maternity payment is made by the Social Security Bureau (where the employee is registered) and is typically based on the average monthly salary across the year preceding the due date, or 3x the minimum wage, whichever is greater. However, calculation of basic and extended maternity leave can vary per province regulations.

Additional leave entitlement is also in place as follows:

  • Prenatal examination includes doctor visits during the first 12 weeks.
  • Difficult delivery – leave days of natural delivery + 15 days
  • Multiple deliveries – leave days of natural delivery + 15 days + 15 days extra per baby
  • Prenatal leave: After 7th month of pregnancy can avail 1-hour day break. May also avail 2.5 months prenatal leave upon employer approval.
  • Breastfeeding leave: For a child less than a year old, female employees may have up to two feeding periods per day (30 minutes per baby). Travel time for the same period shall be counted as working time. Alternatively, after childbirth, female employees may also apply for leave of 6.5 months upon employer approval. With maternity insurance (a part of Social Security Insurance), the employee is compensated with an allowance rather than her normal salary during maternity leave.
  • Abortion or Miscarriage within first 4 months – 15 days
  • Abortion or Miscarriage after first 4 months – 42 days

Termination of workers during pregnancy and within 1 year from Childbirth, is not permitted.

Paternity Leave

Male employees requesting paternity leave are, in the plurality of regions, entitled to 15 days. However, this may vary by location. The following are the cities that do not follow the 15-day norm:

  • Tianjin, Shandong – 7 days
  • Shanghai – 10 days
  • Liaoning, Chongqing, Sichuan, Hunan – 20 days
  • Ningxia, Guangxi, Inner Mongolia – 25 days
  • He’nan, Jiangxi, Anhui, Yunnan, Gansu – 30 days:

Parental Leave

Parents are entitled to paid Childcare leave, the length of which is determined by each individual province as follows:

  • Beijing & Shanghai: 5 days’ childcare leave each year until their child reaches three years old.
  • Fujian, Guangxi, Inner Mongolia, Heilongjiang, Liaoning, Hebei, Jiangxi, Jiangsu, Sichuan, Guizhou, Zhejiang, Tianjin, Ningxia, Henan, Hubei, Hunan, Hainan, Xinjiang, Shandong, and Guangdong: 10 days leave each year for couples with children under the age of three years old.
  • Anhui: 10 days leave per parent each year until their child is six years old.
  • Yunnan: 10 days leave per year can be taken by either parent who has children under the age of three years old. An additional 5 days of leave can be taken per year by parents who have more than two children under the age of three years old.
  • Shanxi, Qinghai & Gansu: 15 days leave each year to couples with children under the age of three years old.
  • Chongqing: Two options on how to use this leave (1) After the Maternity/Paternity leave expires either parent can take childcare leave until the child reaches one year old; or (2) both parents can take 5 to 10 days of leave each year until the child reaches six years old.

Other Leave

In China, In the event of the death of an immediate family member, an employee is entitled to up to three days’ leave, depending on the employment contract and region.
In the event of an employee’s marriage, an employee is entitled to between three and ten days’ leave, depending on the employment contract and region.

Vacation Days
Public Holidays
Highest
Lowest

PAID MATERNITY LEAVE (DAYS)

Highest
Lowest

Termination

Termination Process

The termination process varies according to the employment agreement and Collective Agreement in place and is based on the type of contract, job role, region, and reason for termination.

Notice Period

Notice periods in China are generally set at 30 days, and if notice isn’t given, the employer can provide payment in lieu. The workers are required to give 30-day notices to their employers before they leave.

Severance Pay

In China, severance pay is mandatory if applicable. Still, the amount differs based on the length of service; for less than 6 months of service, half a month’s pay. After 6 months the pay is 1 month pay per year of service. An employee can be entitled to one month of regular salary pay for every year of service completed, up to a maximum of 3x the minimum wage but for no more than 12 months.

Probation Period

The probation period in China is up to 6 months for indefinite contracts and 1 to 2 months on fixed term contracts depending on length of employment.

VISA

VISA

The employer must sponsor the visa and must be an accredited company that may hire foreign employees. The employee must be a certified foreign expert in the field they will be working.
In China, there is an age limit for male and female applicants for a work visa; for male applicants, the age limit is 24-65, and for female employees, the age limit is 24-55. The employer must send a government-issued employment permit and visa notification letter to the employee, executed and submitted to the Chinese government.
A Z Visa is valid for only 30 days upon arrival, and during this time, the employer must apply for a temporary residence permit on behalf of the employee. The Z visa is valid for 90 days up to 50 years.
Other visa options include the R Visa for highly skilled people in great demand in China and the J Visa for journalists.
The process usually takes about 8 weeks to complete.

VAT

General

The average standard rate of VAT in China is 13.00%.

Stay up to date on payroll & employment law changes

Version History

July 1, 2022
In Shanghai, the monthly salary cap for statutory social benefit calculation has changed from RMB 31,014 to RMB 34,188 in July, which will be valid from July 2022 throughout June 2023 as the social benefit year.
July 1, 2021
Minimum wage in Shanghai increases to 2,590.00 CNY
February 22, 2022
The regional minimum wages have been updated.
Payroll contributions and personal income tax rates have been updated.
More

Questions & Answers

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Milena H.
Milena H.
2 years ago

Hi, is a commuting allowance mandatory? If so, how does it work?

Erez Greenberg
Erez Greenberg
2 years ago
Reply to  Milena H.

Hi Milena, a commuting allowance is optional. The amount of reimbursement for travel expenses is based on the distance between the employee’s residence and the employee’s workplace and is treated as income for tax purposes.

Porshea Chong
Porshea Chong
1 year ago

Hi may i know what does daily wages mean? Daily wages is equal to basic salary or basic salary + allowances?

Erez Greenberg
Erez Greenberg
1 year ago
Reply to  Porshea Chong

Hi, it really depends on the setup of the employment. In general, a client will see their salary and be able to add allowances on top.

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What’s covered in this guide:

  • Employer/employee contributions
  • Minimum wage
  • Working hours
  • Visa requirements

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Public Holidays Calendar

China
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Date Day Holiday Notes
1 Jan 2024 Monday New year´s Eve
10 Feb 2024 Saturday Lunar New Year
11 Feb 2024 Sunday Spring Festival
12 Feb 2024 Monday Spring Festival
13 Feb 2024 Tuesday Spring Festival
14 Feb 2024 Wednesday Spring Festival
15 Feb 2024 Thursday Spring Festival
16 Feb 2024 Friday Spring Festival
17 Feb 2024 Saturday Spring Festival
8 Mar 2024 Friday International Women’s Day A common but not mandatory half day off for women only
4 Apr 2024 Thursday Qing Ming Jie
5 Apr 2024 Friday Qing Ming Jie Holiday
6 Apr 2024 Saturday Qing Ming Jie Holiday
1 May 2024 Wednesday International Labor Day
2 May 2024 Thursday Labour Day Holiday
3 May 2024 Friday Labour Day Holiday
4 May 2024 Saturday Labour Day Holiday
5 May 2024 Sunday Labour Day Holiday
10 Jun 2024 Monday Dragon Boat Festival
15 Sep 2024 Sunday Mid-Autumn Festival Holiday
16 Sep 2024 Monday Mid-Autumn Festival Holiday
17 Sep 2024 Tuesday Mid-Autumn Festival
1 Oct 2024 Tuesday National Day
2 Oct 2024 Wednesday National Day
3 Oct 2024 Thursday National Day
4 Oct 2024 Friday National Day
5 Oct 2024 Saturday National Day