Three key financial aspects after discharge: one-time separation pay, military service counting toward work seniority, and tax deductions up to 20,000 yuan per year for self-employed individuals

There is no cost involved. Upon discharge, the military transfers your social insurance records and funds to you. You then go to the local social insurance agency to continue those benefits — essentially the same office that handles social insurance enrollment.

The first point is covered by the Regulations on the Resettlement of Retired Military Personnel, which state: “A one-time separation payment shall be issued to retired noncommissioned officers and conscripts who choose self-employment, based on their length of service.” Funding comes from a special central government fund; exact amounts are set by relevant ministries and adjusted periodically. There are five tiers of additional pay: 25% extra for recipients of medals or honorary titles, 20% for those with first-class combat achievements or first-level commendations, 15% for second-class combat achievements or first-level commendations, 10% for third-class combat achievements or second-level commendations, and 5% for fourth-class combat achievements or third-level commendations. The regulations also note that if you do not find employment right away, you may qualify for unemployment benefits; your military service years count as insured periods, except for those placed in retirement or supported through other programs. The second point is addressed in the Law on the Protection of Retired Military Personnel: “Military service periods are counted as work seniority and combined with any subsequent employment history.” These years are also included when calculating pension, medical, and unemployment insurance contributions, and they count as grassroots work experience. Additionally, the Military Insurance Law states that military service years are added to any prior and subsequent periods of employee medical insurance coverage. The third point is outlined in a 2023 announcement from the Ministry of Finance, the State Taxation Administration, and the Ministry of Veterans Affairs, which specifies that self-employed veterans may deduct up to 20,000 yuan per year from applicable taxes for three years; this ceiling can be raised by 20% in certain regions. The deduction is applied sequentially against taxes owed, rather than being paid out as cash. For businesses hiring veterans, the maximum deduction is 6,000 yuan per employee per year, with a possible 50% increase. These provisions are valid from 1 January 2023 through 31 December 2027; those who have not yet reached three years of eligibility may continue to benefit until then.

国务院、中央军委 (2024). 退役军人安置条例（国务院、中央军委令第 787 号，第二十一、二十二、七十四、八十一、八十五条）. https://www.gov.cn/gongbao/2024/issue_11526/202408/content_6969192.html；退役军人事务部 (2020). 关于一次性退役金的十个问题（转载《中国退役军人》2020 年第 10 期）：「基本标准。士兵服现役每满一年，发给4500元」「退役金标准适时调整」. https://www.mva.gov.cn/sy/zzxc/202011/t20201113_43153.html；贵州省退役军人事务厅 (2024). 一次性退役金增发，重要变化！：「现在执行的标准是：士兵服现役每满一年，发给4500元」. http://tyjrswt.guizhou.gov.cn/zfxxgk/fdzdgknr/zdlyxx_5621158/tyaz_5621161/202408/t20240809_85367194.html；烟台市牟平区人民政府 (2025). 答复中引《烟台市退役军人事务局、烟台市财政局关于调整自主就业退役士兵一次性经济补助标准的通知》：「2024年退出现役的每服役一年补助6000元」. https://www.muping.gov.cn/art/2025/11/10/art_105032_2960250.html；全国人大常委会 (2020). 退役军人保障法（第四十二、四十四、五十条）. http://www.mod.gov.cn/gfbw/fgwx/flfg/16048597.html（国防部刊登）；全国人大常委会 (2012). 军人保险法（第十六、二十三条）. https://flk.npc.gov.cn/detail?id=2c909fdd678bf17901678bf73e160645（国家法律法规数据库）；财政部、税务总局、退役军人事务部 (2023). 关于进一步扶持自主就业退役士兵创业就业有关税收政策的公告（2023 年第 14 号）. https://www.gov.cn/zhengce/zhengceku/202308/content_6896456.htm

The regulations only state that the specific amount shall be separately determined by the competent authorities. The only official figure available can be found in the Ministry of Veterans Affairs' official website 2020 annual publication, which states: "For every full year of active service, 4500 yuan shall be paid," and also notes that it will be "adjusted accordingly." The increased proportion mentioned in that article no longer aligns with the current regulations; the regulations shall prevail. A publication from the Guizhou Provincial Department of Veterans Affairs in 2024 year 8 month still states under the new regulations: "The standard currently in effect is: For every full year of active service, soldiers shall be paid 4500 yuan." TODO (To be verified: No formal standard document has been found; can only confirm that provincial departments were still writing this as of 2024 year 8 month). Additionally, do not confuse this with the local "one-time economic subsidy." That is another sum of money determined and distributed by local authorities themselves; for example, in Yantai, for those retired in 2024 year, there is a subsidy of 6000 yuan for every year of service. Most of the new figures found in guides lack a source, as some simply conflate these two different payments. During the period of conscript service, families are also eligible to receive an additional family preferential allowance. The Military Service Law only states that 'the standards shall be formulated by the local people's government, and the central finance shall provide a fixed quota of subsidies'; for the specific amount, you must ask the county-level people's government that approved your enlistment. Regarding the tax portion, it refers to the maximum amount of tax that can be reduced each year. If a business does not scale up, the full amount cannot be utilized, so the overall scale of benefits is only rated as 'Medium'. The 'Regulations on Promoting the Employment and Entrepreneurship of Veterans' implemented from 2026 year 8 month 1 day adds another provision: professional qualification certificates for skilled personnel obtained during the period of service are universally recognized nationwide after discharge.