What is the pension insurance policy in China

As of December 2019, the current contribution rate for enterprises is about 20 percent of the total payroll, and the individual contribution rate is 8 percent of one's salary.

Of the basic pension insurance paid by enterprises, part of it is used to build up a coordinated fund, and the rest goes into individual accounts. Individuals, on the other hand, are credited with the basic pension insurance premiums they pay into their personal accounts.

Pension insurance is a social security system that is mandatorily established and implemented according to national laws and regulations. Both employers and workers are required to make contributions in accordance with the law, and when workers reach retirement age and meet the conditions for retirement, social insurance agencies will pay them pension benefits in accordance with the law, thus guaranteeing their basic old-age life.

Under this system, employers and workers must pay pension insurance premiums in accordance with the law, and when workers reach the retirement age stipulated by the state or withdraw from the workforce due to other reasons, social insurance agencies will pay them pensions and other entitlements in accordance with the law, thus guaranteeing their basic livelihood.

Expanded Information

Ratio of Employee Pension Insurance Contribution Amounts

1. The amount of enterprise contributions = total authorized enterprise employee wages x 20%; the amount of individual employee contributions = authorized contribution base x 8% (currently 8%);

2, Individual workers (including self-employed businessmen and freelancers) contribution amount = approved contribution base × 18%.

Example

Say your province's last year's flat wage was 747 yuan per month, so the contribution base can be chosen between 747-2241 yuan. The minimum amount of contribution for the whole year is: 747×18%×12=1613.5 yuan, and the maximum is: 2241×18%×12=4840.6 yuan.

People's Daily Online - Interpretation: this year's pension standard increased by 5% How to adjust specifically?