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Recently, a couple of new Social Security Agreements have been signed between China and various Western countries as well as South Korea. This article will give you a brief introduction to the most important benefits and provisions.

 

A Social Security Agreement, also called Totalization Agreement, is a bilateral agreement that aims at eliminating the risk for expats to pay social insurance contributions in both China and his or her home country. Additionally, these agreements help cover the time gaps, which occur, when an employee works in another state than his home country, and are, therefore, vital to protect workers from facing shortfalls in pension benefits after retirement.

 

The Western countries with which China has recently concluded Social Security Agreements are Canada, Switzerland, Finland, Denmark, the Netherlands, Germany. In 2013, China also signed an agreement with South Korea.

 

When did they enter into force?

 

Below are listed the countries with which China has signed Totalization Agreements according to the inception date:

 

 

Germany 4 April 2002
South Korea 16 January 2013
Denmark 14 May 2014
Canada 1 January 2017
Finland 1 February 2017
Switzerland 1 June 2017
Netherlands 1 September 2017

 

 

Which insurance is covered?

 

The insurance schemes covered by the respective agreements can be seen below:

 

Social Agreement

 

Employee Secondment

 

The agreements also stipulate the time period during which seconded personnel in China can be exempted from Social Insurance Contributions. The exact period for dispatched employees per country is:

 

Germany 5 years 
Canada 6 years
Netherlands 5 years
Denmark 3 years
Finland 5 years
Switzerland

6 years

South Korea

5 years

 

 

Family members

 

In some cases, the Totalization Agreements include also family members. Unless they themselves are employed or self-employed in China, the spouse and children benefit from the same regulations as seconded employees. The specific provisions are as follows:

 

Switzerland Children and Spouse
Netherlands Children and Spouse
Denmark Children and Spouse
Canada not mentioned
Germany not mentioned
Finland not mentioned
South Korea not mentioned

 

Apart from the above-mentioned countries, France and Spain have also recently signed Totalization Agreements with China. Both agreements are not yet ratified.

 

ECOVIS Beijing is a Sino-German Consultancy focused on accounting, audit, tax, and legal advisory. If you have any questions regarding our accounting and tax services, please contact This email address is being protected from spambots. You need JavaScript enabled to view it.

 

 

 Iris Wang Grey  

Iris Wang

 

Iris Wang holds the position of Senior Tax Associate at Ecovis Beijing. She has over 5 years of experience in tax compliance and consulting services and her field of expertise is in tax planning and optimization for expatriates, individual income tax consulting and structuring services. Before joining Ecovis Beijing, she worked in the Big Four for over 5 years and has served many prestigious international clients. For more information, please contact: This email address is being protected from spambots. You need JavaScript enabled to view it.
Ecovis Beijing is the trusted tax and legal advisor to several embassies and official institutions in China. It specializes in mid-sized international companies and is focused on tax & legal advisory, accounting and auditing. If you’re interested in finding out more about tax and legal, don’t hesitate to sign up to our Newsletter, give us a call +86 (10) 6561 6609 or contact us directly via This email address is being protected from spambots. You need JavaScript enabled to view it..
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