In addition, according to Clause 2 Article 2 of this Decree, foreign workers shall be also exempt from participation in compulsory SI in Vietnam when they are "intra-company transferees” as stipulated in Clause 1 Article 3 of Decree No. 11/2016/ND-CP or they “reach retirement age”.
SI contribution rates and benefits with regard to foreign workers are basically similar to those applied to Vietnamese workers. However, firstly, employers shall make a SI contribution in proportion to 3% of each foreign worker’s payroll, on which the social insurance payment is based, to pay into the sickness and parental insurance benefit fund and 0.5% of the payroll to pay into the occupational accident and disease benefit fund.
With regard to 22% paid into the retirement and death insurance benefit fund (employers pay 14% and foreign workers pay 8%) shall be only carried out from January 1st, 2022 (Article 13).
In case a foreign worker enters into multiple employment contracts, both the employee and the employer shall only have to pay SI contributions as agreed upon in the first employment contract. If wishing to participate in the occupational accident and disease insurance fund, the employee shall be required to pay SI contributions per each employment contract (Clause 4 Article 13)
Because foreign workers shall pay to retirement fund by 2022, thereby the retirement benefit shall be only calculated from 2022. Entitlement conditions and rates are similar to those given to Vietnamese workers. Particularly, with regard to one-off SI benefit entitlement, foreign workers must not wait for 1 year but they may receive one-off SI benefit entitlement right after their employment contracts are terminated (Article 9).
This Decree takes effect from December 1st, 2018.
The regulations provided in Article 9 (retirement benefit) and Article 10 (death benefit) of this Decree shall enter into force from January 1st, 2022.
However, this provision also specifies that foreigners are not allowed to own houses in areas subject to national defense and security requirements.
Regarding areas subject to national defense and security requirements at which foreigner are not allowed to own houses, they are mentioned in Official letter No. 10328/BQP-TM dated October 19th, 2016, and Official letter No. 786/BCA-TCAN dated April 19th, 2017.
In addition, within 05 working days as from the day of signing the labor contract, the employer has to send the copy of the labor contract already signed to the agency that has granted, re-granted such work permit.
Accordingly, in case a company pays taxi fares from foreign experts’ houses to the workplace on their behalf (the foreign experts are seconded to the company by the parent company) in accordance with the company's internal regulations, such expenditures shall be exempt from PIT.
Dossier proving the PIT already paid outside Vietnam shall be carried out according to point b.2.1, Clause 3 Article 21 of Circular No. 92/2015/TT-BTC.
If this person pays compulsory insurance premiums in his/her host country similar to those in Vietnam (such as social insurance, health insurance, unemployment insurance, etc.), the insurance premiums shall be subtracted upon calculation of PIT (point c Clause 2 Article 9 of Circular No. 111/2013/TT-BTC).
However, this person has to make an authorization letter in which specifying the authorization to carry out procedures for tax accounting, tax refund and receipt of the tax refund on his/her behalf concurrently such authorization letter must be consularly legalized (Clause 13 Article 2 of Circular No. 26/2015/TT-BTC).
With regard to the company taking the authorization, when carrying out procedures for tax refund, it has to submit a written commitment to fully transfer the tax refund to the foreigner according to the authorization letter.
However, such foreign representative office’s Head has to declare and pay PIT on incomes earned in Vietnam every quarter by using form No. 07/KK-TNCN at the tax authority of the location where his/her job is taken place (Clause 8 Article 16 of Circular No. 156/2013/TT-BTC).
Payable PIT shall be determined according to the tax rate of 20% (Article 18 of Circular No. 111/2013/TT-BTC).