In Vietnam, many citizens choose to work abroad according to the type of labor export as it brings them a huge source of income. However, if they go to work abroad, do they still have to pay social insurance in Vietnam?
Point g Clause 1 Article 2 of the Law on Social Insurance in 2014 states that people who go to work abroad under contracts specified in the Law on Vietnamese employees working abroad under contracts are subject to compulsory social insurance.
By that, those working abroad under a contract must still pay for social insurance in Vietnam.
In addition, the provision on employees going to work abroad under contracts in the Labor Code 2019 also affirms that people working abroad are obliged to pay taxes, participate in social insurance and other forms of insurance according to the law of Vietnam and the law of the employees-receiving country.
However, according to point g, Clause 1, Article 6 of the Law on Vietnamese employees working abroad under contract, if Vietnam and the foreign companies have signed an agreement on social insurance or an agreement to avoid double payment, the employee will not have to pay social insurance or personal income tax twice in Vietnam and in the receiving country.
This means that, if Vietnam and the country of reference have signed an agreement on social insurance or double taxation then the employee would only need to pay for tax and insurance once. If they had already paid for insurance abroad then they would not have to do the same in Vietnam.
Amount of social insurance contribution for employees working abroad
Currently, according to clause 2, Article 85 Law on Social Insurance 2014, labor exporters must pay social insurance contributions to the retirement and survivorship fund with the following fees:
- Employees who have had a history of participating in compulsory social insurance: Monthly social insurance payment = 22% x The employee’s monthly salary on which social insurance contributions are based before going to work abroad
- Employees who have not participated in compulsory social insurance or have participated in compulsory social insurance but have received lump sum social insurance: Monthly social insurance payment = 22% x 2 x base salary
The employee can pay the social insurance payments every 3 months or every 6 months or every 12 months or make a lump-sum payment in advance according to the time limit specified in the contract of sending employees to work abroad for the social insurance agency.
In case the employee is able to extend the contract or sign a new contract in the receiving country, the employee shall continue to pay social insurance contributions by one of the methods mentioned above or remit it to the social insurance agency after the employee returns to Vietnam.
The employees working abroad may pay social insurance contributions directly to the social insurance agency where they reside before going to work abroad or pay social insurance contributions through enterprises or non-business organizations sending employees to work abroad.