China -  Chinese law firm

Are there any exceptions to the new rules?

Under the old rules the contribution was calculated based on the average monthly salary income of the participating employee from the previous year, therefore the higher the salary the higher the contribution. Since employers must match the contribution by the employee the enterprise must also set aside more money with increases in salaries. An exception to the new rules is that companies that are financially sound may, if they like, continue contributing according to this previous scheme. This is subject to approval from the competent bureau. In addition an exception has been granted to the software industry. Employees who work for software companies certified by the Beijing Commission of Science and Technology can contribute up to 20% of their monthly salary despite the Beijing average. Contributions are tax free for individual income tax purposes.

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