According to the Circular of the Ministry of Finance on the Printing and Distribution of the‘Regulations on Several Issues on the Adoption of the Enterprise Accounting Regulations’of Foreign-invested Enterprises (C.K. (2001) No.62), foreign-invested enterprises shall establish a welfare fee payable account, and calculate the pension, insurance, subsidiaries and other welfare fee amounts from the original salary payable, as well as the employee bonus and welfare fee after tax, and establish the two accounting items of welfare fee and bonus and welfare fee after tax.

According to the Circular of the State Administration of Taxation on the‘Taxation of Medical Insurance fees and the other Three Funds as a Welfare Fee’by Foreign-invested Enterprises and Foreign Enterprises (G.S.H. (1999) No.709), foreign-invested enterprises shall set aside medical insurance fees and the other three funds, and education and trade union funds for employers, and shall not set aside other welfare funds before the levy of tax. Therefore, foreign-invested enterprises that adopt the Enterprise Accounting Regulation shall no longer set aside 14% of the employee’s total salary as the staff welfare fee. The welfare fee incurred shall be included under the accounting item of profit and loss. If the actual amount exceeds the previous amount, adjustments will be made during the levy of tax.

The balance from the "welfare fund payable bonus and welfare fee set aside after taxation" account and the "bonus and welfare fund from profits after taxation" shall be utilized according to the relevant laws and regulations.