Your quick guide on talent and labor compliance norms in China
Chinese Yuan Renminbi (CNY)
GDP per Capita
Based on Local Government Laws
The most populous country, China, is also the world’s largest economy by GDP (based on PPP). China is the world’s largest manufacturing and exporting country and is one of the fastest-growing countries in the world. Currently, the country ranks the second most wealthy country among all other world economies.
Major economic hubs:
Beijing, Shanghai, Suzhou
Skills in demand:
Engineer, IT, Management, Sales
The top local universities in China include the following:
The top jobs available and their respective salaries are listed below:
|Job titles||Average Monthly Salary (CNY)||Average Monthly Salary (USD)|
|Business Development Manager||46,300||6,451|
The payroll cycle followed in China is monthly.
The minimum wage varies in different provinces. It ranges from 1,450 RMB – 2,690 RMB per month.
The standard working hours in China are 8 hours per day and 44 hours per week. Overtime work is only possible after consultation with any applicable trade union unless the situation is an emergency. Overtime is limited to 1 hour per day, or 36 hours per month. Below are the rates for overtime pay:
Most companies pay the 13th-month salary as a bonus to their employees during the month of Lunar New Year or Spring Holidays.
China Social Security contributions Include Pension, Medical, Maternity, Unemployment and Accidental which are mainly managed by the Ministry of Human Resources and Social Security (MOHRSS). Also, there is another contribution Housing Fund which is managed by the Ministry of Housing and Urban-Rural Development and the employer has to contribute 5% to 25% based on the city employee is based on.
|Social insurance items||Employee’s portion||Employer’s portion||Employee’s portion||Employer’s portion||Employee’s portion||Employer’s portion|
|Medical (including maternity)||2%||10%||2%||9.8%||2%||6.85%|
|Unemployment||0.5%||0.5%||0.5%||0.5%||0.2%||0.32% to 0.8%|
|Work-related injury||0%||0.16% to 1.52%||0%||0.2% to 1.9%||0%||0.16% to 0.12%|
|Total||10.5%||26.66% to 28.02%||10.5%||26.5% to 28.2%||10.2%||22.33% to 213.77%|
|Ceiling for monthly salary base||CNY 34,188||CNY 21,884||CNY 22,930 for pension; CNY 36,544 for medical; CNY 36,072 for unemployment|
For residents, the income tax rates are as follows:
|Annual taxable income (CNY*) (1)||Tax rate (%)||Quick deduction (CNY)|
|0 to 36,000||3||0|
|Over 36,000 to 144,000||10||2,520|
|Over 144,000 to 300,000||20||16,920|
|Over 300,000 to 420,000||25||31,920|
|Over 420,000 to 660,000||30||52,920|
|Over 660,000 to 960,000||35||85,920|
For non-residents, the following tax rates are applicable:
|Monthly taxable income (CNY)||Tax rate (%)||Quick deduction (CNY)|
|0 to 3,000||3||0|
|Over 3,000 to 12,000||10||210|
|Over 12,000 to 25,000||20||1,410|
|Over 25,000 to 35,000||25||2,660|
|Over 35,000 to 55,000||30||4,410|
|Over 55,000 to 80,000||35||7,160|
The standard VAT rate in China varies from 0% to 13%.
Offboarding & Termination
It is difficult to terminate an employment contract in China unless by mutual agreement or if an employment contract expires.
Notice period varies depending on the length of employment. During the probationary period, it is between 3 to 30 days, and for permanent employees, it ranges from one to three months.
The severance pay is mandatory if applicable, and the amount varies depending on the length of the employment term. It is calculated as one month’s salary for each full year. For employees with high salaries within the area, the severance pay is capped at three times the local average wage.
Visa and Immigration
For any non-PRC passport holder, a work permit is required. Exceptions include Taiwan, Hong Kong and Macao residents. There occurs a grading evaluation for expatriate employees.
Streamline payroll and compliance for your international workforce
|Day of Overtime||Overtime Pay Rate|