How to work in China legally?-- Part 2
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Social Insurance
The employers and foreigners shall pay the social insurance in accordance with relevant regulations.
1. Principle of national treatment
Enjoy the same treatment as Chinese mainland residents. They shall participate in the basic medical care insurance, the work-related injury insurance, the unemployment insurance and the maternity insurance.
2. Exemption agreement for some insurances
If there is any bilateral or multilateral treaty on social insurance entered into by and between China and a foreign country, the social insurance issues of the citizens of such foreign country employed in China are subjected to the relevant treaty. So far, the countries have signed social insurance mutual exemption agreements with China including Germany, South Korea, Denmark, Finland, Canada, Switzerland, Netherlands, France and Spain.
3. Leaving China before receiving the pension
If a foreigner leaves China prior to reaching the stipulated age for receiving pension, his or her personal social insurance account will be retained. The period of contribution payment is cumulatively calculated upon his or her returning and being employed again in China. When the foreigner applies in writing for termination of the social insurance, the balance of his or her personal social insurance account will be paid to the foreigner in a lump sum.
Individual income tax
Check this articles for more information: New IIT Law’s impact on Foreigners
Legal liabilities
In regard to foreigners who refuse to have their work permit inspected by the labor administrative authorities, change their employers and professions at will or extend their term of employment without permission, the labor administrative departments shall withdraw their work permits and recommend that their residence status be canceled by the public security departments. In cases of deportation, the costs and expenses shall be paid by the employed foreigners or their employers.
In regard to foreigners and employers who make up, change, falsely use, transfer, trade the work permit and the Employment License, the labor administrative departments shall take over the work permit and the Employment License, confiscate the illegal proceeds and impose a fine between ten thousand and one hundred thousand Yuan. Serious cases which constitute a crime shall be investigated by the judicial authorities for responsibility.
If a foreigner could not afford the related expenses of repatriation, the entity or individual that employed him or her shall bear the expenses in the case of illegal employment; in other circumstances, the entity or individual that has guaranteed to cover the expenses of the foreigner during his or her stay or residence in China shall bear the expenses.