Business China

China Social Insurance

+86-020-2917 9715

It is crucial for businesses that are planning to operate in China learn more about the eligibility for China social insurance, and the benefits it can lead to for their businesses. China’s Social Insurance Law which was passed in 2011 had established the first truly national basic social insurance framework that the whole of China could follow. It was specifically constructed for the employees of mainland China, but had many far reaching benefits for all employees. Under the law, all employers within China are required to enroll their employees in five insurance programs, including one mandatory housing fund. The five China Social Insurance and the single housing fund refer to the combination of several different types of guaranteed treatment that’s provided for the benefit of the employees by their employers. Some of the benefits that are required to be given by employers in China include: endowment insurance, medical insurance, unemployment insurance, industrial injury insurance and birth insurance, and housing accumulation fund.

There’s a reason why the Chinese Government has made it mandatory for companies in China to provide
their employees with the benefits of setting up social insurance for a WFOE. For starters, without proper social security or accumulation fund, the employees will experience several problems such as; medical treatment not being reimbursed, being unqualified for a home purchase, and more importantly, pension not guaranteed. Other difficulties that a business owner might face includes, being unqualified for the total self-payment of antenatal care, being unqualified for the points system for household registration, being rejection admission of children’s school, and having credit collection records.

Five Insurances 

  • Pension
  • Medical Insurance
  • Unemployment Insurance
  • Work-related Injury Insurance
  • Maternity Insurance
China social insurance

In China, the Social Security Law was propagated by the Central Government but the specific details, along with its administration, are governed by local authorities. Under China’s Social Security Law, it is paid by both the employer and the employee and is connected directly to the employee’s monthly salary. The process of a China Insurance Fund can get complicated, since there is no single rule for the entire country. What this means is, in China, social insurance is governed at a regional level. This means, the responsibilities of the employer will differ, depending on the location of the company.

Importance of China Social Insurance

  • A China Social Insurance is a system in which the Chinese government is able to obtain certain material help from the society through the legislative means to guarantee the laborer's loss of life source due to their age, illness, injury and unemployment. 
  • For instance, with pension insurance, the individual payment of workers all credited to personal accounts, the company payment should also draw a part into the personal account. After retiring, the principal and interest of the personal account will be returned to the employee (or his/her family), on a monthly basis. In addition to this part of the "personal account pension", the employee's retirement benefits include monthly "basic pension" and ‘annual salary adjustment’.
  • The benefits of other kinds of social insurance for employees are also made obvious: employees who participate in unemployment insurance can receive unemployment insurance benefits for up to two years after they lose their livelihood. If a worker suffers serious injury or death, he or she may receive a medical grant, or a pension, or a relief fee. Industrial injury insurance can enable workers in China to obtain free medical treatment, including hospital expenses, and disability compensation after a serious injury or accident.

China Social Insurance System

Benefits of Purchasing Housing Accumulation Fund

Going through the China Social insurance set up process is worth it for businesses operating in China since it benefits both the employees and the employer. Business China can help you during all the stages of setting up your business in China, including purchasing a housing accumulation fund for your employees. The
following are some of the benefits of purchasing a housing accumulation fund;

Lower Threshold of Housing Accumulation Fund Benefits More Employees

The notice concerning the development of the personal housing loan business of the housing provident fund stipulates: if the employee has accumulated the housing provident fund for six months (including), and can apply for housing fund personal housing loan. Continuous payment for 6 months can allow many employees who are having difficulty due to work changes to use the housing accumulation fund loans, especially for young people who have just joined the workforce.

Low Interest Rate to Cut Costs for Estate Buyer

1 to 5-year loan interest rate for the first suite is from 3.50% to 2.75%, and 3.75% to 3.25% in 5-30 years, this is good news for the general public. In 2015, the fall in the interest rate of the housing accumulation fund loans directly reduced the purchase cost for homebuyers. The new policy of the accumulation fund rate has been a great encouragement for buyers to enter the market actively.

Housing Accumulation Fund is Withdraw-able

This is another benefit of the China social insurance, and more specifically, the housing accumulation fund. During the repayment of the housing accumulation fund, if the deposit is normal, reputable and not overdue, you can apply for a loan repayment, or you can apply for extraction to repair or improve the housing condition.

Housing Accumulation Fund Reduces Post-Loan Repayment Pressure

If the borrower (including the borrower’s spouse) has entrusted the housing fund without changing the loan mode according to the monthly payment from the account of a personal housing provident fund, the public accumulation fund will be returned to the housing provident fund loan in the current month, while the insufficient part will be repaid by the bank from its repayment account. 

The Down Payment is as Low as 20%

According to a notice issued by the Foshan Housing Accumulation Fund Management Center on January 14, from March 1, 2015, urban employees can apply for a housing accumulation fund loan as long as they have paid more than six months for the housing accumulation fund. Meanwhile, the maximum amount of personal loans has been increased 
to 400,000 yuan. 

For foreign enterprises, China social insurance and housing accumulation fund are not only time consuming, but also means, having to deal with the complexities of different local policies, different social security bases. Business China is a full-service company providing expertise in establishing social insurance for a business. Business China has been approved by the Guangzhou Administration of Industry and Commerce to handle financial information consultation, financial information consultation and enterprise management consulting for foreign businesses looking to expand to mainland China. 

Service Objects

The following are just some of the reasons why WFOEs, JV, and ROs look towards our professional China social insurance services to lessen their burden;

  • Start-up Company –A foreign business that is set up in China is expected to meet the needs of local employees' social security and provident fund requirements through a local quality agency service company.
  • Development Company –During the expansion period, it is expected to devote more energy to the recruitment of employees and the management of retention.
  • Proposed Listed Company -Traditional social security payment processes are complicated. It is considered that social security and accumulation fund can be paid more easily.

Document Checklist for China Social Insurance Application

Business China has years of experience in delivering unmatched services to professionals doing business in China. We will make sure all your documentation is in proper order during the China Social insurance set up process:
  • Original copy of your company's business license, and a photocopy
  • List of all the employees of your company
  • Employees' Personal ID or Passport Original
  • Corporate Bank Account Opening Permit
  • Company chop

Service Procedure of Housing Accumulation Fund

Business China will be with you every step of the way to ensure that your best interests are met. The following is the service procedure of Housing Accumulation Fund in China;
  • To open an account for the housing provident fund;
  • To ratify the base of the housing accumulation fund;
  • Agent housing fund transfer procedures;
  • Agent housing accumulation fund seal procedure;
  • Procedures for the remittance of the housing accumulation fund;
  • Repayments of the housing provident fund
  • Agent housing accumulation fund withdrawal;
  • Related policy consultation on housing accumulation fund.

Contact Us Today
To find out more about our services please feel free to contact us at +86-020-2917 9715 or send us an email with your queries to

  • James Oliver "True professionals, very helpful and dedicated. Your support team is fantastic."
  • Robert Gatti "Our advisor was brilliant and we were given more help that we knew we needed. What I liked most about Business China's service was the prompt and businesslike approach.It helped us dramatically. At a...
  • Vivian Belfanti "Quality work and friendliness is why I chose to work with Business China. Business China is organized very easy to work with."
  • Tim Orchard "Thanks to Business China’s professional guiding and efficient processing about company incorporation and VAT refunding, our new entity in Guangzhou already step into a virtuous circle. I have to say...
  • Victor Declety "Business China allows us to focus on our customers instead of being tangled into enterprise level business incorporation and maintance."
  • Ben Hunter "Business China is helping people who don't necessarily know how to connect your current business with the booming Chinese market and how to lay out your 'China Dream' here specifically. It has been...
  • Daniel Wong "A great customer experience! The flexability and speed of response from the account manager, as well as the quality of the service process was exceptional."
  • Stacey Morris "Businesss China has been superb. Their customer service is great. The guys there respond very quickly and go above and beyond that help."
  • M. Salem Having real-time information allows us to deal with issues immediately before they become problems.We are satisfy with Business China.
Request a Proposal

Drop Business China a quick message to let us know about your incorporation needs.