Job Discussion Forums

doogsville · Joined: 17 Nov 2011 Posts: 924 Location: China

Hi, I just got a message from my FAO telling me I have to contribute 10.2% of my salary in social security payments from now on. Also the uni will pay 30.65%. I'm on my 6th contract here and they're dropping this on me now. I just wondered if it's a nationwide, or even Guangdong wide thing, or just my uni? Hey ho, if I needed another reason to leave China next year (I don't) then this would have been it. final nail and all that.

Also, I know it's been covered but I can't find it, has anyone successfully claimed it back on leaving China?

jimpellow · Joined: 12 Oct 2007 Posts: 913

It is nationwide, but has been like other directives from above implemented at different times in different jurisdictions. I do believe that they intend to give you all but the medical part back if you claim it when you leave. The catch is that you have three days just before your departure for the school and the government to do their parts. To me, it sounds like in reality you will not get it back as someone is going to sit on it.

I have wondered about this before too as I have never heard of anyone who successfully claimed it or got sc***** out of it. I think in reality that few attempt to claim it.

BTW, the school loses their contribution. That is a pretty low percentage your school needs to pay compared to the typical 35% and up to 40%. As I have said before, that 30% to 40% actually become an indirect tax on teachers' salaries as it significantly raises the overhead on teachers and hence depresses salaries.

Foo_Fighters_Dave · Joined: 09 Dec 2016 Posts: 162

If teachers retire in China at 65, can they use it as their pension? Can Foreign teachers retire and live in China off their payments into pension? I always wondered this.

In South Korea, I paid into pension and could cash it out when I leave for good or use it when I turn 65.

jimpellow · Joined: 12 Oct 2007 Posts: 913

I haven't read up on this, but the funny thing about it originally was that a teacher could not draw the pension as he could not retire in China unless he was say married to a Chinese national. The last I read, which was discussed here, was talk of allowing the teacher for drawing it from overseas.

That is not a half bad idea. The problem as I see it is that China's pension system, like many in the world today, is severely underfunded and has horrific demographics working against it in the future. Once they need to do cuts, I think it would be wise to conclude that the foreigners' pensions would be at the top of the list.

Elicit · Joined: 12 May 2010 Posts: 244

I have received a refund from this scheme as have 2 other ex-colleagues. Just a trip to the city’s pension administration office with my passport and the willingness to tell them I was leaving China was enough for me (I didn’t leave China but new employer hadn’t implemented the social security scheme). The refund was in my Chinese account in less than three weeks.

Employers lose contributions and you need to spend everything on the medical card or lose this money/benefit too, as someone has already said. You should get all of your contributions back in a nice little lump sum, so this scheme is best viewed as a savings account. After all, who in their right mind would want to retire here.

NiHaoDaJia · Joined: 07 Aug 2014 Posts: 118

As our western countries decline, I think many westerners will hope to retire in China. The people are honest and in my view, Chinese food is the best in the world. I am an American who came to China to teach conversational English. I will consider retiring in China using the old age pension system that is now in effect.

Elicit · Joined: 12 May 2010 Posts: 244

The bear · Joined: 16 Aug 2015 Posts: 483

Modernist · Joined: 03 Jan 2016 Posts: 72 Location: Routing

jimpellow · Joined: 12 Oct 2007 Posts: 913

nimadecaomei · Joined: 22 Sep 2016 Posts: 605

lionheartuk · Joined: 03 Jun 2005 Posts: 173 Location: Guangdong

Never been implemented where I work and I have been here 10 yrs.

Elicit · Joined: 12 May 2010 Posts: 244

Jurisdiction is probably at play, but also the employer who reluctantly followed the social security system had little choice in the matter due to using staff for part-time work on all flavor of visas for a lengthy period of time before being made to conform to the employment regulations. No competition in their business with other providers though, so perhaps they did sign up more willingly.

Come to think of it, I did lose 1 month’s contribution because I cashed in before my last paycheck. This was a sacrifice well made though because I had already contributed a reasonable amount of money and wanted to ensure I got it back.

Rather than lose the last month, it would be possible to leave China and access the funds in your account from another country. I know somebody who did this, but in my opinion it would be a riskier prospect. However, when you close you must tell them that you are leaving the country (irrespective of real future plans) or problems may ensue.

On a standard one year university salary swallowing the loss may be doable but for lengthier contracts or more highly paid work it soon adds up.