Payroll and Social Insurance for Vietnamese Companies

If you employ anyone in Vietnam, you run a Vietnamese payroll, and Vietnamese payroll is a discipline. The good news: it is rule-based, predictable, and easy to outsource for $80–300/month for a small headcount.

The three withholdings

Each month you withhold from gross pay and remit:

1. Social insurance (SI) — pensions, sickness, maternity, accident
2. Health insurance (HI) — universal health card
3. Unemployment insurance (UI) — covers job loss
4. Personal income tax (PIT) — 5–35% progressive

Contribution base is capped at 20× the region minimum wage (approx. 96m VND/mo HCMC). Above the cap you pay no further SI/HI/UI, only PIT.

PIT brackets for residents

For 2026:

Personal allowance: 11m VND/mo. Dependant allowance: 4.4m VND/mo each (spouse not working, children under 18, parents over working age).

Non-residents (under 183 days): flat 20% on Vietnamese-source income.

Worked example

A senior developer at 70m VND/mo gross.

• Employee SI/HI/UI = 70m × 10.5% = 7.35m (capped contributions apply but base under cap)
• Personal allowance: 11m
• Taxable income: 70m − 7.35m − 11m = 51.65m
• PIT: progressive — 0.25m + 0.5m + 1.2m + 2.8m + 4.9m + (51.65 − 52)×30% — about 9.6m
• Net to employee: ~53m
• Employer cost on top: 70m × 21.5% = 15m
• Total employer cost: 85m for a 53m take-home

The gap is roughly 60% — important when sizing offers.

E-filing and remittance

Since 2022 everything is electronic:

• eTax (etax.gdt.gov.vn) for PIT filings
• VssID for social insurance
• Monthly PIT declaration by 20th of next month
• Quarterly PIT for small businesses with under 50M monthly liability
• SI/HI/UI by month-end of following month
• Annual PIT finalisation by end of March

You need a digital signature device (USB token from VNPT, Viettel, BKAV, FPT — about $30/year). Without it nothing files.

E-invoices

All sales invoices must be e-invoices since July 2022. MISA Meinvoice, VNPT Invoice and Viettel S-Invoice are the common platforms. Subscriptions ~$50–150/year for low volumes.

What to outsource

For under 10 employees, outsource the lot to a local accounting firm (NEXIA STT, KTC, RSM Vietnam at the higher end; many small bilingual firms at $150–400/mo). They handle:

• Monthly SI/HI/UI/PIT filings
• E-invoice issuance
• Annual financial statements
• Tax health checks

Run payroll calculations in-house, send the numbers to the accountant, they file. Do not let the accountant also process payments — keep banking control.

13th month and bonuses

13th month is paid at TếtTết (Tet)tetVietnamese Lunar New Year, the most important national holiday, typically in January or February; a time for family reunion, ancestor worship, and new-year rituals. and is fully taxable as PIT in the month paid (lump-sum). This can push you into a higher bracket that month; smart payroll spreads bonuses across multiple months where possible.

Honest take

Vietnamese payroll is not hard, but the deadlines are unforgiving and the penalties for late filings start small but compound. A $200/mo accountant is the best money a small Vietnamese company spends.

Related

• Hiring locally in Vietnam
• Vietnam tax as foreigner deep dive
• Starting a company in Vietnam
• Invoicing Vietnamese clients

Summary

Vietnamese payroll combines mandatory statutory withholdings (Social Insurance, Health Insurance, Unemployment Insurance, and Personal Income Tax) with electronic filing requirements and strict monthly deadlines. Employers must understand the contribution caps, progressive PIT brackets, and the significant gap between gross cost and employee take-home — typically 60% more than net pay. Small companies benefit from outsourcing payroll to local accounting firms for $150–400/month rather than managing compliance internally.

Process at a glance

1. Calculate gross pay — agree salary with employee; confirm it's not above the SI/HI/UI cap (20× regional minimum wage)
2. Withhold mandatory deductions — apply employee SI/HI/UI (10.5%) and PIT using the progressive bracket table minus allowances
3. Pay net to employee — typically 60–70% of gross depending on income bracket
4. Remit to authorities — file PIT electronically by 20th of following month; remit SI/HI/UI by month-end following month
5. Annual reconciliation — finalize PIT by end of March; settle any underpayment or claim refund

Cost breakdown

For a 70m VND gross salary in Ho Chi Minh City, the employer's total monthly cost is approximately 85m VND ($3,400 USD at current rates), of which 15m is statutory contributions and 70m is gross pay. The employee receives roughly 53m VND ($2,100 USD) net after all withholdings and allowances. Outsourcing payroll and compliance to a bilingual accounting firm costs $150–300/month and is essential for companies with more than 5 employees or plans to scale; the tax risk and filing penalties far exceed the accountant fee.

Common pitfalls

• Not accounting for the 60% gap — many employers underpay base salary thinking the gross figure equals employee cost; statutory contributions nearly double the actual labor cost
• Missing the SI/HI/UI cap — salaries above 20× regional minimum wage still accrue PIT but are exempt from further SI/HI/UI deductions; miscalculating this inflates withholding
• Late filing penalties — PIT and SI/HI/UI deadlines are rigid (20th, month-end); even one day late triggers compounding penalties; set calendar reminders or outsource
• Forgetting digital signature requirement — all eTax and VssID filings require a USB token from VNPT, Viettel, BKAV, or FPT; without it, no submission succeeds
• Mixing accountant and banking control — if the accountant also processes payments, fraud or error tracking becomes impossible; typically keep bank access separate from filing authority
• Lump-sum 13th month tax shock — 13th-month bonuses at Tết are fully taxable in the payment month and can push an employee into a higher bracket; spreading bonuses or deferring can reduce PIT

Official resources

• gdt.gov.vn — Vietnam General Department of Taxation; PIT brackets, eTax portal, guidance
• molisa.gov.vn — Vietnam Ministry of Labor, Invalids and Social Affairs; SI/HI/UI contribution tables, regional minimums, compliance updates
• eTax portal (etax.gdt.gov.vn) — live PIT declarations and annual tax finalization

Verify before acting. Rules change. Confirm with a qualified Vietnamese adviser before relying on any specific detail.