CHINA Law and Practice Contributed by: Chengchen Gan (Mark), Commerce & Finance Law Offices
untarily participation, market-oriented operation, and the support of national policies. Individuals voluntarily deposit a sum of money in a specific account, not exceeding CNY12,000 per year, to purchase approved financial products. When they reach retirement age, this will serve as an additional source of pension sup - plementary to the basic pension insurance. Moreover, personal pension contributions are eligible for preferential deferred taxation. In addition, if cer - tain conditions are met, individuals can apply for the early withdrawal of their personal pensions. In addi - tion to these benefits, there are preferential pension policies such as increased special additional deduc - tions for taxpayers who support parents over 60 years old, exemptions from value-added tax on elderly care services provided by elderly care institutions, and tax reduction and exemption on the income of community elderly care facilities. Accumulative Whole-Life Insurance With the advances in medical technology and the increase in average life expectancy, Incremental Whole Life Insurance (IWL) has become a new and increas - ingly popular life insurance product in response to the gap between perceived and actual life expectancy. IWL, as the name suggests, refers to a whole life insur - ance product, of which the cash value and the amount of cover increase as time goes by. This product is particularly suitable for the current era of longevity, and on average, its value is likely to exceed the pre - mium paid. 9. Planning for Non-Traditional Families 9.1 Children Particular attention is paid on the protection of chil - dren’s interests under the PRC law, with special arti - cles designed and imposed specifically for children born out of wedlock, adopted children and posthu - mously conceived children. Children Born Out of Wedlock Overall, the PRC law offers the same level of protec - tion for children born out of wedlock and adopted chil - dren. In 2020, the original “Marriage and Family Law”
was compiled by the PRC Civil Code and merged into its Marriage and Family Section, which explicitly gives children born out of wedlock the same rights as those born in wedlock. In particular, the definition of “children” under the PRC Civil Code equally includes and refers to children born out of wedlock, adopted children and children born in wedlock, giving each of the foregoing equal legal status at law, including inheritance rights. Usually, children born out of wedlock need to pro - vide a paternity test report to confirm their identity in order to legally enjoy the right to inheritance (includ - ing through legal or testamentary succession). With the report, the law will automatically presume legal status even if objections or queries are raised by any other party. Adopted Children To protect the rights and interests of adopted children, the Marriage and Family section of the PRC Civil Code emphasises that adoption should follow the principle that is in the best interest of the adopted child, and expressly prohibits the sale of minors in the name of adoption. For example, to be eligible as an adopter, one needs to fulfil all the conditions listed below: • have no children or only one child; • have the ability to bring up, educate and protect the child; • not suffer from a medical condition which would be deemed as inappropriate to adopt a child; • not have a criminal record that would have an adverse influence on the healthy development of the child; and • be over 30 years of age (for unmarried individuals, the age difference between such individual and the child shall at least be 40 years). Surrogate Children China has strict laws and regulations imposed against surrogacy. The “Measures for the Administra - tion of Human Assisted Reproductive Technologies” expressly prohibits and bans medical institutions and personnel from implementing surrogacy technology with serious legal consequence and penalties.
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