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One-time Social Insurance claim for foreign individuals working in Vietnam.

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One-time social insurance claim for foreign individuals working in vietnam

One-time Social Insurance (SI) claims under Decree 143/2018/ND-CP are detailed in the regulations of SI law, Occupational Safety and Hygiene law on compulsory SI for foreign citizens working in Vietnam, effective date from 1 January 2022.

Foreign employees in Vietnam are required to participate in the compulsory SI program if they have a labour or employment contract signed with employers in Vietnam (which is ensured with Work Permits, practising certificates and/or practising licenses issued in the country).

Conditions for the claim

Foreign employees can apply for this claim if their employment contract is terminated or their Work Permits, practising certificates, or practising licenses expire without being permitted for renewal.

The foreign employees who process this claim will not be allowed to continue to work in Vietnam within 12 months from the contract termination date. If they do so, the insurance department will request arrears of the claimed amount, and the risk of penalty will be incurred.

Required documents

  • Package of documents required by SI Department (Form 13 & 14)
  • The passport translated into Vietnamese and notarised
  • Notarised document from the Department of Justice
  • Employment/Labour contract
  • Termination decision
  • Work Permit
  • Social Insurance book

Benefits

The calculation of one-time SI is based on the number of years that an employee pays for SI contributions. (Clause 2, Article 8, Decree 115/2015/ ND-CP)

Claimed amount = 2x Average monthly SI salary x Number of years contributing SI
Average monthly SI salary = Total SI salary of months contributing SI / Number of months contributing SI

For employees who participate in the SI program for one year or more:

  • If the contribution period is from 1 to 6 months, it is counted as half a year
  • If the contribution period is from 7 to 11 months, it is counted as one year

For employees who participate in the SI program for less than one year, the estimated claimed amount is 22% of the average monthly SI salary multiplied by the number of months of contributed SI. The total received amount will not exceed two months of the average SI salary.

Example

An employee joins SHUI from January 2022 to July 2023 with an average monthly SI salary of VND29,800,000 (this is the prevailing capped amount of SI salary for the period before 1 July 2023 – the base to calculate monthly SI contributions at the prescribed rates). Where employees’ gross salary exceeds the cap, the base to calculate contributions is equal to the cap. From 1 July 2023, the cap amount of SI salary will increase to VND36,000,000; therefore, benefits for the year 2023 onwards will increase accordingly based on the new cap. The claim amount the employee is expected to receive is 2 x VND29,800,000 x 2 years = VND119,200,000.

Conclusion

The one-time Social Insurance (SI) claim under Decree 143/2018/ND-CP offers a valuable benefit for foreign employees leaving Vietnam. Understanding the eligibility requirements and claiming process can help you access this financial support during your job search. For further advice, contact our teams for expert support and additional information on managing corporate compliance in Vietnam.

Tran Huynh, Head of Payroll Services & HR Consulting | tran.huynh@acclime.com
Matthew Lourey, Managing Partner | Email: m.lourey@acclime.com

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Updated on April 2, 2024
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