What does the individual contribution base mean?

Personal contribution base is an important factor to determine the amount of social security contributions and future social security benefits.

Personal contribution base refers to the social insurance contribution base of employees in a social security year, which is determined according to the monthly average amount of all wages (total wages) of employees in the previous year. If it is a fresh graduate or a new employee, the first month's salary will be used as the base of social security payment. The social insurance payment base is an important basis for calculating the social insurance premiums and social insurance benefits paid by employers and their employees, and the specific amount depends on the actual situation in each region. Generally speaking, the social insurance payment base multiplied by the payment ratio is equal to the social insurance premium payable. In the relationship between social security payment and total wages, social security should be paid according to the actual income of employees. If the wages of employees are lower than 60% of the local average wage, they shall be paid according to 60% of the social average wage; If it is higher than 300% of the social wage, it shall be paid according to 300% of the social wage; In between, pay according to the actual salary. The individual contribution base directly affects the amount of social insurance premiums deducted each month, and also affects the accumulation of individual pension accounts, so the amount of pension that can be received after retirement will also be affected.