Can the social security contribution base be inconsistent with the personal income tax?

In China, the base for social security contributions and the base for personal income tax should be the same in principle. The social security contribution base usually refers to the employee's entire wage income in a social security year, including basic salary, performance pay, bonuses, allowances and so on. This base figure determines the social security fees to be paid by the employee and the company, including pension insurance, medical insurance, unemployment insurance, work injury insurance and maternity insurance.

Individual income tax, on the other hand, is a tax levied on an individual's income, and its base is also usually the entire income of an individual in a tax year. According to China's tax law, personal income tax is levied on wages and salaries, remuneration for labor, articles and royalties.

While the base for social security contributions and the base for the collection of personal income tax should be the same in principle, in practice, there may be a certain degree of discrepancy between the two due to asymmetric information, concealment and omission of information by enterprises, and other reasons. For example, in order to reduce the cost of social security contributions, some enterprises may underreport the salary income of their employees, which results in a lower base for social security contributions than that for personal income tax.

To solve this problem, the Chinese government is actively promoting the comparison of the social security contribution base and the personal income tax to ensure the consistency of the two through information ***sharing and joint enforcement. In addition, as the adjustment mechanism of the social security contribution base becomes more and more perfect, and the tax authorities continue to strengthen the collection and management of personal income tax, the social security contribution base and the collection base of personal income tax will become more consistent in the future.