We have updated our 2017 Vietnam Payroll Quick Guide effective 1 July 2017, helping employers and employees understand general calculations and obligations with payroll and payroll related taxes in Vietnam.
As always, we discourage the use of Net salaries for employers, and encourage all salaries and contracts to be prepared on a Gross basis. Net salaries are not only more complicated to administer, they push the tax burden onto the employer for any changes by the government in personal tax or insurance rates that are intended for the employee only.
Employers and employees should note that from 1 July 2017 the Minimum Basic Wage increases, resulting in increases to Social Insurance and Health Insurance caps and therefore increased calculations are linked to these. In addition, the total Social Insurance payment for employers has decreased to 17.5% from 18.0%.
Please contact Domicile Corporate Services if you would like to discuss your salary strategies, or how these salary changes affect your business.