China Payroll
The Housing Fund in China

The Housing Fund in China

In China, a form of social insurance known as the Housing Fund is managed and administered differently from other forms of welfare.

Employers and employees both make contributions to the housing fund, and the amounts vary from Chinese city to city.

The secret to avoiding issues while contributing to it and ensuring that the company’s operations fully comply with Chinese legislation is to understand how it operates.

What is the housing fund in China?

Various cities in China have different social security and housing fund rules and regulations.

Every Chinese employee and employer is expected to make a monthly contribution toward the required social insurance as well as other social benefits including housing funds and social security funds.

To assist Chinese employees in saving money for the purchase of their own homes, Housing Fund was formed in 1999. As a result, China now enjoys social security and stability. Housing Fund, like other social welfare programs, is regulated by the government at the federal level, although each local government is free to determine the contribution rates.

The housing fund vs. the other mandatory insurances

The welfare and social security systems are governed by the ministry of human resources and social security, and the welfare program includes five types of social insurance: maternity, medical, pension, work-related injury, and unemployment insurances.

The Housing Fund is typically managed by the Ministry of Housing or other local Housing Fund offices when it comes to the Chinese welfare system, but it is always a part of it. The Housing Fund differs fundamentally from other social programs in that there is no social pool because all funds flow directly into each employee’s personal account. Additionally, the withdrawal of the credits is only permitted in certain circumstances, such as down payments, building costs, purchases, remodeling costs, and mortgage repayment.

Housing fund contributions

Taking Shanghai for an example.


The rate of publicly accumulated housing fund payment for employee and employer and employer is 7% respectively.


Contribution Base= on the previous year’s monthly average salary of the employee.

For other cities in China, please check: Complete Guide of China Social Security

How to register the housing fund account for your employees

  • Establishing a Housing Fund Bureau account. Companies are normally required to produce the company’s business license as well as an ID document for the legal representative of the company.
  • In most cases, applications are accepted right away. For payments to the housing fund, the company will be given a unique account number.
  • To automate contribution payments, companies must execute a contract with the Housing Fund Bureau, the firm, and an appropriate bank. The first payment, like social insurance, must be made with a cheque provided by the firm.

New enterprises must register with the neighborhood Housing Fund Bureau within 30 days of opening in order to make contributions to the Housing Fund. Within 30 days of the employee’s first day on the job, the employer who recruited them must register them with the Housing Fund Bureau. Companies can update the information online in some places, such Shanghai or Beijing. To update all the information, however, a representative of the HR department must visit the local bureau in other places.

To make things simpler for you and to ensure compliance, we can assist you with this procedure.

If the employer neglects to open the Housing Fund account for the employee, a fine of between 10,000 RMB and 50,000 RMB is assessed.

Can employees access their housing fund?

Employees may withdraw money from their housing fund, but only if they need to do so in order to pay for a Chinese home. The employer is required to verify the request and provide a withdrawal certificate when an employee seeks a withdrawal from his or her personal Housing Fund.

The employee then submits an application for withdrawal to the Housing Fund Bureau, which will either accept it or reject it three days after receiving it. The Housing Fund withdrawals, however, are governed by a number of different local legislation.

In accordance with local laws, China Payroll can manage all employee benefits for your business and take care of the visa requirements for any foreign employees.

Contact us now to know how to process the recruitment and employees’ management in China.

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