What is the use of social security base

Social security base it is determined according to the monthly average of all wage income earned by employees from January to December of the previous year. The social security contribution base is an important basis for calculating the social security contributions to be paid by the employer and its employees and the social security benefits of the employees.

What is the purpose of the contribution base

The contribution base is an important indicator of the level of contributions made by the insured. The contribution ratio is a fixed value, which can't be changed, the national regulations are the same, for example, the unit contribution for pension insurance is 16%, the individual contribution is 8%, which can't be changed, all units and individuals have to contribute according to this ratio; however, the contribution base is a variable value, which varies according to the change of my position, job and salary, the higher the contribution base, the higher the standard of contribution, the higher the standard of future contributions, and the higher the standard of future contributions. The higher the contribution base, the higher the contribution standard and the higher the future pension. For example, in the same unit according to 60% of the standard contribution and according to 300% of the standard contribution, the monthly contribution amount is five times different, the balance of funds credited to the personal account will also be five times different, the personal account pension will also be five times different.

But in the calculation of the pension, in addition to the personal account pension, also involves the calculation of the basic pension. The calculation of the basic pension is based on the average of the sum of the average monthly salary of employees in the previous year and the average indexed salary of the person's contributions over the years as the basis for calculating the base pension, and 1% of the base pension is paid for each year of contribution. In the calculation of the basic pension, the basis of payment is very critical, and the basis of payment consists of two parts. One part is the average monthly salary of employees in the previous year, which is also a fixed value, in the same co-ordination area, in the year for the retirement of the people, this figure is the same; but the average contribution index salary is a change in the value of the value of the change is that each person's contribution base is not the same, so according to the average of the number of years of contributions, the contribution index salary is not the same, the usual contribution base is high after the average will be high, so the average is not the same, after the average is high. After averaging, the average will be higher, so the final calculation base will be higher, the 1% calculated by the basic pension will be higher.

Legal basis:

The People's Republic of China Social Insurance Law

Article 12: The employer shall pay the basic pension insurance premiums in accordance with the ratio of the total wages of the employees of the employer as stipulated by the State, and the premiums shall be credited to the basic pension insurance fund.

Employees shall pay basic pension insurance premiums in the proportion of their own wages as prescribed by the State, which shall be credited to their individual accounts. Individual industrial and commercial households without employees, part-time workers who do not participate in basic pension insurance with their employers, and other flexibly employed persons who participate in basic pension insurance shall pay basic pension insurance premiums in accordance with the state regulations, which shall be credited to the basic pension insurance general fund and individual accounts respectively.

Article 23 Employees shall participate in the basic medical insurance for employees, and the employer and employees shall pay the basic medical insurance premiums in accordance with the state regulations***. Individual industrial and commercial households without employees, part-time workers who do not participate in the basic medical insurance of employees in their employing units, and other flexibly employed persons may participate in the basic medical insurance of employees, and individuals shall pay the basic medical insurance premiums in accordance with the state regulations.

Article 35 An employer shall pay work-related injury insurance premiums in accordance with the total wages of the employees of the employer at a rate determined by the social insurance agency.

Article 44 Employees shall participate in unemployment insurance, and the employing unit and the employees shall pay the unemployment insurance premiums together in accordance with the state regulations***.

Article 53 Employees shall participate in maternity insurance, and the employer shall pay maternity insurance premiums in accordance with state regulations, and employees shall not pay maternity insurance premiums.