China remains one of the most dynamic economies in the world, offering global businesses access to a massive market, advanced manufacturing, and skilled professionals in technology, engineering, and finance. However, hiring in China is not without challenges. Complex labor laws, regional differences, payroll compliance, and strict government regulations make entry difficult for companies without a local entity.
A Professional Employer Organization (PEO) or Employer of Record (EOR) simplifies this. By using a PEO in China, companies can hire in China, manage employees compliantly, and streamline payroll processing—all without setting up a legal entity.
Table of Contents
- What Is a PEO in China
- PEO vs EOR in China – What’s the Difference
- Why Use a PEO in China Instead of Setting Up an Entity
- Simplify Global Compliance
- Key Employment Insights in China
- No Entity? No Problem
- How a PEO Helps With Payroll, Tax & Benefits in China
- Chinese Labor Laws Made Simple With a PEO
- When to Choose a PEO Over Other Hiring Models
- What to Look for in a Chinese PEO Partner
- Asanify’s Advantage as a PEO in China
- What Does It Cost to Build a Team in China
- Ready to Hire in China? Here’s What to Do Next
- FAQs
What Is a PEO in China?
A PEO in China supports companies in managing Human Resource Management functions locally while ensuring compliance. Operating as a co-employer, a PEO like Asanify handles:
- Payroll processing & Payroll Managing
- Salary payments in RMB with tax compliance
- Benefits administration (social insurance, housing fund, medical plans)
- HR documentation and locally compliant contracts
- Filing with Chinese authorities (tax bureau, social insurance offices)
- Contractor Management solutions for freelancers and consultants
This model is ideal for startups, SMEs, and multinational firms that want to hire in China without incurring the heavy costs of entity setup.
With Asanify’s PEO services, you can employ professionals across China and 160+ countries. Employees are paid on time, receive competitive benefits, and stay compliant with national and local laws—while you remain in charge of business operations.
PEO vs EOR in China – What’s the Difference?
Both a PEO and an EOR in China help companies hire in China without building an in-house HR system, but they differ in structure. A PEO requires a local entity and shares HR functions, while an EOR becomes the full legal employer in China, handling payroll, compliance, and contracts independently.
| Feature | PEO in China | EOR in China |
| Legal Employer | Client (shared employer) | EOR provider (full legal employer) |
| Entity Requirement | Requires local entity | No entity required |
| Payroll & HR | Shared responsibility | Fully managed by EOR |
| Best For | Companies with existing entity | Startups or testing market entry |
| Immigration & Visas | Managed by client | Managed by EOR provider |
| Contracts | Client drafts and controls contracts | EOR issues compliant contracts |
| Switching to Entity | Already established | Migration support provided |
Why Use a PEO in China Instead of Setting Up an Entity?
Partnering with a PEO in China provides compliance assurance, cost savings, and faster market entry. With Asanify PEO services, you can hire, onboard, and manage employees in China without entity formation.
Hire Top Talent in China
China has a massive workforce across IT, finance, R&D, and manufacturing. With Asanify, you can hire in China quickly.
- Access skilled professionals in Beijing, Shanghai, Shenzhen, and Guangzhou
- Avoid long entity setup procedures
- Offer compliant, competitive salaries
Build Your Global Employer Brand
Employees expect compliance and benefits that match Chinese labor laws.
- Provide statutory benefits like social insurance and housing fund
- Ensure contracts meet legal standards
- Use a Salary Calculator to benchmark local pay packages
Reduce HR and Legal Overhead
Setting up in China means navigating bureaucracy and hiring compliance experts.
- Avoid costly entity setup
- Eliminate payroll mismanagement risks
- Reduce HR administration
Test & Expand Into New Markets
If you’re exploring China, a PEO lets you test the market flexibly.
- Hire employees quickly with no fixed infrastructure
- Scale across provinces or cities
- Transition to your own entity later
Suggested Read: Employer of Record China: A Comprehensive Guide 2025
Simplify Global Compliance
China’s employment framework includes both national and local regulations. With Asanify, you ensure every compliance layer is handled.
- Stay aligned with standard 40-hour workweeks and overtime rules
- Ensure compliance with annual leave, sick leave, and maternity entitlements
- Rely on local HR experts to manage tax filings, audits, and government reporting
Key Employment Insights in China
Payroll Processing & Contributions
- Payroll processed monthly
- Employer social insurance contributions: ~16–25% (varies by region)
- Employee social insurance contributions: ~10–15%
Leave Policies
- 11 public holidays annually
- Paid vacation: 5–15 days depending on tenure
- Sick leave entitlements vary by seniority and location
- Maternity leave: 98 days (can be extended by region)
- Paternity leave: 7–15 days
Bonuses & Benefits
- 13th-month salary (year-end bonus) common practice
- Housing fund contributions are mandatory
- Additional perks: meal subsidies, transport allowance, insurance top-ups
Income Tax (2025)
- 3% up to RMB 36,000
- 10% for RMB 36,000–144,000
- 20% for RMB 144,000–300,000
- 25% for RMB 300,000–420,000
- 30% for RMB 420,000–660,000
- 35% for RMB 660,000–960,000
- 45% above RMB 960,000
Cultural Alignment and Professional Etiquette
- Respect for hierarchy and formal communication is essential
- Building long-term trust is key in Chinese business culture
- Mandarin is the primary business language; English is common in multinational hubs
No Entity? No Problem
With Asanify as your PEO in China, you don’t need a registered entity to start hiring. We manage compliance while you focus on scaling.
- Hire employees in days instead of months
- Avoid contractor misclassification risks
- Scale across China cost-effectively
How a PEO Helps With Payroll, Tax & Benefits in China
A PEO in China handles the complexity of payroll and compliance:
- Monthly payroll processing and payroll managing
- Gross-to-net salary calculations
- Social insurance and housing fund payments
- Bonus administration and statutory allowances
Chinese Labor Laws Made Simple With a PEO
China’s labor laws are complex and vary by province. A PEO streamlines compliance with:
- Working hours: 40-hour workweek with regulated overtime
- Probation periods: 1–6 months depending on contract
- Paid leave: Annual vacation, sick leave, and public holidays
- Termination rules: Notice period and severance based on tenure
- Union laws: Compliance with trade unions and labor bureaus
When to Choose a PEO Over Other Hiring Models
A PEO in China is the best choice when you:
- Want to test the Chinese market before forming an entity
- Need small teams for short-term or pilot projects
- Are scaling quickly and require agile HR and payroll support
- Aim to reduce costs while staying compliant
What to Look for in a Chinese PEO Partner
When evaluating a PEO in China, consider:
- Strong understanding of Chinese labor and tax laws
- Quick onboarding and compliance support
- Transparent pricing and scalability
- Digital-first Human Resource Management and payroll tools
- Contractor management and visa assistance expertise
Asanify’s Advantage as a PEO in China
Asanify leverages technology and compliance expertise:
- Onboarding within 48 hours
- Automated payroll with Salary Calculator integration
- Real-time compliance monitoring
- Local experts across provinces
- Scalable, transparent pricing
What Does It Cost to Build a Team in China?
Companies generally choose between:
- Setting up a local entity in China, or
- Hiring through a PEO.
Option 1: Setting Up a Local Entity in China
- Requires registration with local authorities, tax bureau, social insurance, and banking setup
- Timeline: 8–12 weeks
- Investment: $15,000–30,000+ upfront
- Best for long-term, large-scale operations
Option 2: Hiring Through a PEO in China
- No entity required
- Onboard employees in days
- Includes payroll, benefits, HR, and compliance
Indicative Monthly Pricing (2025):
| Service Type | Starting From (Per Employee/Month) |
| PEO Solution | $49 USD |
| Employer of Record | $199 USD |
Why Choose a PEO in China?
- Hire employees in days, not months
- Avoid legal, financial, and HR setup burdens
- Reduce compliance risks with local expertise
- Focus on growth while we handle payroll and HR
Suggested Read: Understanding Labour Laws in China 2025
Ready to Hire in China? Here’s What to Do Next
Hiring team in China can be simple with the right partner. Book a free consultation with Asanify to explore your hiring strategy. We’ll guide you through China’s compliance requirements and onboarding checklist.
With Asanify’s platform, you can manage payroll, HR, and employee benefits in under a week. You’ll also get access to contractor management solutions and salary benchmarking with our Salary Calculator everything needed to scale confidently in China.
FAQs
A PEO in China co-employs staff and manages payroll, HR, benefits, and compliance alongside your local entity.
By managing contracts, payroll processing, and compliance, a PEO helps you hire in China faster.
Lower HR costs, streamlined payroll managing, and reduced compliance risks.
A PEO requires a local entity, while an EOR becomes the full legal employer without entity setup.
Yes, PEOs provide Contractor Management solutions to engage freelancers legally.
Yes, including salary calculations, tax withholdings, and social security contributions.
Local compliance expertise, transparent pricing, and digital HR tools.
Yes, Asanify provides full support for transitioning from PEO to entity.
Typically within 5–7 business days.
Yes, with a Salary Calculator to design competitive packages.
Not to be considered as tax, legal, financial or HR advice. Regulations change over time so please consult a lawyer, accountant or Labour Law expert for specific guidance.
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