China Law Online Database : novexcn.com

You are using Guest Account

Subscribe To This Law Only

Subscribe To All Law Contents

Print This Page

Back




	NOTICE OF THE MINISTRY OF FINANCE ON THE FINANCIAL ARRANGEMENT FOR PURCHASE OF INSURANCES FOR EMPLOYEES

	(No. 61 [2003] of the Ministry of Finance promulgated on February 9, 2003, which shall come into force as of April 1, 2003)


SUBJECT : INSURANCES FOR EMPLOYEES
ISSUING DEPARTMENT : MINISTRY OF FINANCE OF THE PEOPLE'S REPUBLIC OF CHINA
ISSUE DATE : 02/09/2003
IMPLEMENT DATE : 04/01/2003
LENGTH : 665 words
TEXT :

With the development of the insurance industry, the enterprises and employees have become more and more aware of insurance. As reported by some regions and enterprises, it is not good for standardizing the financial management if enterprises in different industries or of different ownerships have different financial arrangements on how to list the expenditure of the funds needed in buying commercial insurances for individual employees in addition to the uniformly arranged social insurances stipulated by the state. In order to strengthen the financial management of enterprises, maintain the lawful rights and interests of the enterprise owners and employees, promote the healthy development of the insurance industry, we hereby give our notice as follows regarding the issue of financial arrangement for enterprises to buy insurances for employees:

I. Various types of enterprises shall, in accordance with the "Labor Law of the People's Republic of China" and the relevant provisions of the state, participate uniformly arranged social insurances such as basic pension insurance, unemployment insurance, basic medical insurance, etc.. The social insurance premiums paid for employees other than the basic medical insurance premium, shall be listed into the costs (expenses) as labor insurance premium, and the basic medical insurance premium paid for employees shall be listed as expenditure from the welfare benefits payable; the social insurance premium paid by employees shall be withheld from the wages payable to individual employees.

II. The enterprises which have set up supplementary pension insurance for employees and the enterprises located in Liaoning or other experimental regions for the experiment of improving urban social security system shall draw less than 4% of the total amount of wages as the labor insurance premium, and list it into costs (expenses); enterprises in non-experimental regions shall list the money as expenditure from the welfare benefits payable, provided that they shall not result in deficit in such welfare benefits payable.

Where an enterprise participating basic medical insurance sets up supplementary medical insurance for its employees, the part among the necessary expenses which is within 4% of the total amount of the wages shall be listed as expenditure from the welfare benefits payable, while the insufficient part of the welfare benefits payable shall be directly listed into the costs (expenses) as labor insurance premium.

III. The commercial insurances such as property insurance and personal insurance, bought by employees from commercial insurance companies shall belong to individual investments, and the funds needed shall all be borne by the individual employees, instead of being reimbursed by the enterprises.

IV. An enterprise shall, in accordance with its internal rules of procedure, and upon the resolution of the board of directors or manager's (factory director's) working meeting, reform its internal distribution system. If it buys commercial insurances for its employees in addition to the actually paid wages and uniformly arranged social insurances as encouragement to its employees, the funds needed shall be listed as expenditure from the wages payable. If it buys the above said commercial insurances as welfares of its employees, the funds needed shall be listed as expenditure from balanced welfare benefits payable, provided that it shall not result in deficit in the welfare benefits payable. The taxation issues involved shall be handled in accordance with the relevant provisions in the taxation policies of the state.

V. Public welfare fund shall be a component part of the enterprise owner's equity. The enterprise shall not, during the period of normal production and operation, use the capital expenditure that should be used in the employees' collective welfare facilities required by the provisions, to pay insurance premiums for the employees.

VI. The present notice shall come into force on April 1, 2003. The "Notice on the Issue concerning the Avenues for Commercial, Trade and Financial Enterprises to List the Expenditure of the Relevant Insurance Funds" of the Ministry of Finance (No. 104 [1998] of the Ministry of Finance concerning Commercial Affairs) shall be abrogated simultaneously. In case of any conflict in other documents with the present notice, the present notice shall prevail.