Each quarter, Acclime Vietnam releases our Quarterly HR & Payroll Updates focusing on relevant legislation, regulations, and changes released in the previous quarter, Official Letters released by Vietnam Authorities, together with reminders for key dates for implementation of HR & Payroll changes coming into effect or upcoming reporting obligations to authorities.
The easing of procedures for granting Work Permits due to the impact of the epidemic expired from 1 January 2023
On 9 January 2023, the Department of Labour, War Invalids and Social Affairs of Ho Chi Minh City released Official Letter 374/SLDTBXH-VLATLD on the implementation of Resolution 105/NQ-CP dated 9 September 2021 of the Government on supporting businesses, organisations, and business household in the context of COVID-19.
The authority noted that regulations on easing conditions and procedures for granting and extending Work Permits for foreign individuals during the COVID-19 epidemic period according to Resolution 105 expired from 1 January 2023.
Therefore, from 1 January 2023, when carrying out administrative procedures related to foreign employees, enterprises must prepare all documents in accordance with the provisions of Decree 152/2020/ND-CP.
Circular 18/2022/TT-BYT amends Circular 56/2017/TT-BYT detailing the implementation of the law on Social Insurance
On 31 December 2022, the Ministry of Health released Circular 18/2022/TT-BYT amending and supplementing a number of articles of Circular 56/2017/TT-BYT detailing the implementation of the Law on Social Insurance.
Some significant changes of the circular include:
- Supplementing some cases entitled to one-time Social Insurance
- Clarifying dossier for examination and assessment to enjoy one-time Social Insurance
- Clarifying conditions of medical examination and assessment to enjoy retirement, survivorship and leave due to insufficient health to raise children after birthOther changes stipulated in article 1 of the Circular
The Circular takes effect from 15 February 2023.
Adjustments to procedures for registration of dependents from 1 January 2023
On 13 January 2023 the Ministry of Finance released Decision 40/QD-BTC announcing revised and supplemented administrative procedures in the field of Taxation and Customs under the management function of the Ministry of Finance. In which, the regulation of adjustments to procedures for registration of dependents from 1 January 2023 is notable, with the following points:
- For individuals paying tax through an income paying organisation (employers), employees are required to arrange and send 2 sets of dependent registration dossiers to their employers. The employers keep 1 set and submit 1 set to the tax authority at the same time as submitting the PIT declaration of that tax period (or when submitting the PIT finalisation dossier).
- For individuals who directly declare and pay tax, they must submit the dependent registration dossier to the directly managing tax authority at the same time as submitting the PIT declaration of that tax period or when submitting the PIT finalisation dossier. As for other dependents specified in Item d.4, Clause 1, Article 9 of Circular 111/2013/TT-BTC (e.g., brothers, sisters, grandparents, aunts, etc.), the time limit for registration is no later than 31 December of the tax year.
In addition, during the period of calculation of dependent deduction, if there are any changes (registration/adjustment/removal) in dependent, the taxpayer must re-register the dependent with the process same as first time registration).
No later than 3 months from the date of first dependent registration, the individual must prepare documents to
Prove dependent according to the guidance in Article 1 of Circular 79/2022/TT-BTC and send it to the income- paying organisation or tax authority where the dependent registration form was first submitted.
The Decision took effect from 1 January 2023.
Official Letter Released
Official Letters are releases showing the interpretation and application of Vietnam’s Taxation Laws by applicable authorities, providing guidance to enterprises and individuals in Vietnam. In this update, we will focus on Official Letters indicating HR & Payroll matters.
Guide to PIT declaration for employees of branches outside the headquarter’s province
On 19 December 2022, Hanoi Department of Taxation issued Official Letter 62788/CTHN-TTHT on PIT declarations for employees working for branches outside the headquarter’s province.
According to the new regulations in Article 19 of Circular 80/2021/TT-BTC, in case the company directly pays salaries to employees working at branches outside the headquarter’s province, the company is responsible for withholding and declaring tax following form 05/KKTNCN with the appendix of the tax distribution table for localities with branches according to form 05-1/PBT-KKTNCN and submit it to the tax office at the head office.
At the same time, the company pays the PIT amount allocated to each province where the branch is located according to the provisions of Clause 4, Article 12 of Circular 80/2021/TT-BTC.
Notes about PIT when supporting benefits, giving gifts, giving rewards to employees
On 1 February 2023, Hanoi Department of Taxation issued Official Letter 3469/CTHN-TTHT on supporting benefits and giving gifts and rewards to employees. Accordingly, the authority provides some notes regarding the withholding of PIT for a number of expenses for allowances, gifts, and bonuses for employees as followings:
- Where the spending is the payment on behalf for training to improve qualifications and skills suitable to the professional work of the employees, the PIT is exempted (Point dd.6 Clause 2 Article 2 of Circular 111/ 2013/TT-BTC)
- Where the spending is the payment to individuals winning in contests and the prize value is over VND 10 million, PIT must be withheld according to the instructions in Item g, Clause 1, Article 25 of Circular 111/2013/TT-BTC
- Where the spending is a benefit other than salary or wages (in cash or not in cash), PIT must be withheld according to the instructions in Item b, Clause 1, Article 25 of Circular 111/2013/TT-BTC
- Where the company give a gift in kind that is not of salary or wage nature and does not fall under the provisions of Clause 10, Article 2 of Circular 111/2013/TT-BTC, it is not required to withhold PIT
Reminder of selected key regulations coming into effect in 2023
|Effective date||Key HR & Payroll items||Remarks|
|Regulations on increasing to Minimum Basic Wage from 1 July 2023 in Resolution 69/2022/QH15 on the state budget estimate for 2023||11 November 2022||1 July
|The “base salary” will be increased from 1.49 to 1.8 million VND/month. This will result in an increase to the maximum caps for calculating Social Insurance, Health Insurance and Trade Union payments and therefore increasing the potential payments by employees and employers for these insurances.||Click here to read our article on this matter|
Reminder of upcoming periodical reports in Quarter 2 of 2023
|Upcoming Periodical Reports||Deadline|
|Semi-annual Report on Changes to Employment for the first 6 months of 2023||Prior to 5 June, 2023|
|PIT Self Finalisation by individual taxpayers||Prior to 4 May, 2023|
For more information on HR & Payroll Updates and other compliance requirements for businesses operating in Vietnam, follow our monthly releases on the website and social media channels at vietnam.acclime.com.