The basic pension of enterprise retirees is exempt from personal income tax, and the income from re-employment is paid according to the taxable items of "income from wages and salaries". However, because retirees no longer pay five insurances and one gold, there is no social insurance premium and provident fund withheld and remitted by individuals.

Personal Income Tax Law

Article 4 The following incomes shall be exempted from individual income tax:

Seven, in accordance with the unified provisions of the state to cadres and workers resettlement fees, retirement fees, retirement wages, retirement wages, retirement allowance;

State Administration of Taxation (SAT)

Reply on how to calculate and levy personal income tax on the income obtained by individual part-time workers and retirees after re-employment

Guoshuihan [2005] No.382

Xiamen Local Taxation Bureau:

Your request for instructions on how to calculate and collect individual income tax on the income of individual part-time and retirees after re-employment (No.34 [2005] of Xiamen Local Taxation Bureau) has been received. After study, the reply is as follows:

According to the Individual Income Tax Law of People's Republic of China (PRC) (hereinafter referred to as the Individual Income Tax Law), the Notice of State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) on Printing and Distributing the Provisions on Several Issues Concerning the Collection of Individual Income Tax (Guo Shui Fa [1994] No.089) and the Reply of State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) on the Individual Income Tax of Film and Television Actors (Guo Fa [1997]).

State Administration of Taxation (SAT)

Press release issued on 26 April 2005