Managing your payroll in China

 This article provides insight into managing your payroll in China:

  • What kind of companies can use the payroll service
  • The advantages of outsourcing your payroll in ChinaPayroll in China

The payroll process is the procedure that organizations or companies do to pay its employees. It is mostly done on a specific day of every month in the case of full-time employees. It may slightly differ for part-time or contractual employees. The payroll process is known to be a multifaceted and sensitive as it is related to the salaries of the employees. The consequences of an ineffective payroll process can serious as it may give rise to employee disappointment and in extreme cases may even result in penalties or employee resignations.

There are different ways to manage your payroll in China. Payroll in China involves the payment of employee’s salary, handling the mandatory benefits (social security), Individual Income Tax deduction, payment of annual bonus, Overtime Payment (if applicable), etc.
Social Security in China consists of 5 mandatory insurances and a housing fund. The employer has to contribute the social security on a monthly basis. The employer is also responsible for deducting the Individual Income Tax on a monthly basis and the tax declaration to the tax authority. What is significant is that different cities in China have different social security and housing fund policies, and the contribution rates and the base are adjusted every year, which makes compliance a challenge for foreign companies while handling their employees’ payroll. Thus, outsourcing their payroll and mandatory benefits to a local human resource service provider is very common among foreign SMEs.

Taking care of your payroll can be done in different ways. One can choose to do the payroll in-house. Or one could choose to outsource the payroll by using a payroll service company, like HROne. Choosing to do your payroll in house is completely up to you. But outsourcing your payroll has been proven to be more efficient, cheaper and easier.

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What kind of companies can use the payroll service

The advantages of outsourcing your payroll in China

Foreign companies often struggle with documentation in China. The government bureaus for social insurance, income tax, residence permit, work permit, housing fund deal with a lot of documentation. Some documents have to be filled in the local language. The policies and procedures have to be strictly adhered to. The process of acquiring certain permits and licenses tends to become cumbersome and time-consuming. Outsourcing these administrative tasks to a local HR service provider like HROne can, therefore, increase your company’s effectiveness.

Focusing the efforts of your company’s human resources on the core business activities can not only save time but also boost your company’s performance as outsourcing administrative tasks liberates your team from the time-consuming tasks.

Outsourcing the administrative tasks to a local HR service provider also reduces your dependency on your in-house HR team, which may otherwise adversely influence your employee’s monthly payroll and statutory benefits processing.

An HR service provider has the expertise and reputation of providing a high level of service in an efficient manner. It can be difficult for your company to deliver the same level of service and flexibility that an HR outsourcing company offers in processing HR transactions. The service provider has the capability not only to resolve your employee’s queries related to the latest laws/benefits but also provide expert guidance about the same.

HROne offers customized and cost-effective end-to-end payroll management solutions for foreign SMEs or start-ups all over Mainland China, Hong Kong or Taiwan. Our competent and reliable team of qualified payroll professionals ensure hassle-free and uninterrupted operations. HROne computes the monthly salary according to the client needs and protocols, taking into consideration all relevant regional HR laws and regulations and specific records such as attendance and deliver a timely payout.

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How HROne can be beneficial to your business

HROne’s offers Employee Leasing/Talent dispatching services for companies not having a legal entity in Mainland China, Taiwan, and Hong Kong. HROne fulfills all essential responsibilities as that of a legal employer for the local employees in Mainland China, Taiwan, and Hong Kong. Once your legal entity has been established in China, HROne can provide Payroll and Individual Income Tax Service, Employee Benefits, Legal documents like Employment Contracts and Employee Handbook, Commercial Insurance, Foreigner Visa, Tax & Accounting Servicesetc. More importantly, HROne can provide bilingual service to its clients – both in English and Chinese.

The information contained in this article is valid on June 26th, 2017. For updated information, please contact us via email at