PR China and Spain signed a social security treaty on 2018. I have the summary of this agreement in my data. In general, this kind of agreements are about 15 – 20 pages but i have not checked the entire agreement yet.
The agreement is only applicable for Expatriates. For example, if a Spanish company seconded a Spanish citizen employee to China for a less than 6 years period. This agreement will be applicable. However, if a Chinese company hires a Spanish citizen directly in China, then this agreement will not be applicable.
You may find below the summary of the agreement. Please let me know if you need any further investigation on this matter.
1. Posting of Employees
During a posting period of six years, posted employees from one of the Contracting Parties will continue to be governed by the social security regime of the country of origin. In the event the posting exceeds six years, the social security regime of the country of origin will continue to apply as long as the relevant authority consents to it.
Employees posted from Spain to China
- Payments in Spain: they will be required to pay contributions for unemployment and contributory pensions for employees, excluding those related to occupational injury or illness.
- Payments in China: they will be exempt in from paying contribution to old-age insurance and unemployment insurance in China. They will be required to pay contributions for healthcare, sick leave, and occupational injury and illness in China.
Employees posted from China to Spain
- Payments in China: they will be required to pay for old-age insurance and unemployment insurance.
- Payments in Spain: they will be exempt in Spain from paying contributions to the unemployment insurance and the contributive pensions for employees, excluding those related to occupational injury and illness. They will be required to pay contributions in Spain for the benefits of the social security regime not exempted.
2. Coverage Certificate
Posted employees will require a “certificate of applicable legislation” in order to benefit from the exemptions set out in the Agreement. The body in charge of issuing the certificate in China is the “Social Security Administration of the Ministry of Human Resources and Social Security” and in Spain the “General Treasury of the Social Security”.
Spanish companies that post employees must submit a request for certification via modeloTA300, “Request for information regarding applicable social security legislation”, which has already been made available for this purpose.
3. Transition
Employees who were posted before the Agreement came into force are deemed to have started their post on 20 March 2018.
4. Coverage
The Agreement applies to three categories of individuals:
- Posted employees
- Workers on board vessels and aircraft
- Members of diplomatic missions or consular positions and public employees
How to Hire or Transfer a Worker Under a Double Taxation Treaty
In 2018, Spain and China signed an agreement exempting workers from one country posted to the other for periods of less than 6 years from certain social security and payroll contribution requirements.
What is a Double Taxation Treaty?
Typically, when two countries have a double taxation treaty there are certain criteria that employees must meet to be able to benefit. In the case of the agreement between China and Spain these were:
Common Requirements for Double Taxation Relief
How to Tell if Your Country Has a Double Taxation Treaty – 5 Essential Resources
1. Government Websites
- Each country should keep a clear list of the treaties they hold with foreign countries. Usually, they’re found on a government or finance ministry website, such as this list from the UK government listing UK foreign treaties.
- However, these lists may not always be clear or complete, and tax treaties may find themselves confusingly mixed in amongst other treaty types.
