Our August 2018 publication on Tax and Accounting updates overs changes to Social Insurance payments for branches, and highlights the proposed minimum salary increases for 2019. We also look at a selection of recent Official Letters released by Tax and related authorities in this publication.
MODIFICATION TO SOCIAL INSURANCE PAYMENT PROCESSES FOR BRANCHES
On 16 July 2018, The Vietnam Social Insurance Department released Decision 888/QĐ-BHXH, effective from 1 July 2018, which amended and supplemented articles on the collection processes for Social Insurance, Health Insurance and Unemployment Insurance.
A significant amendment from this Decision is that branches are now permitted to pay Social Insurance contributions as part of a single payment combined with the parent company payment, replacing the previous requirement for the branch to submit payments in the locality where the branch is located (Clause 1, Article 1).
PROPOSED ANNUAL MINIMUM SALARY INCREASES FOR 2019 RELEASED
The National Wage Council has finalised their proposed annual changes to minimum salaries for 2019, and these have been submitted to the Government for final ratification.
The proposed minimum salaries will increase by 5.3% on average for 2019 across the 4 regions, with region 1 (which covers most of HCMC and Hanoi) increasing to VND 4,180,000
from the 2018 minimum salary of VND 3,980,000.
The increase will also effect the maximum payment cap for Unemployment Insurance, which is 20 times the minimum salary. Employers should factor in these changes into their budgeting process for 2019.
For more information, click Vietnam Tax Update August 2018 – Domicile
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