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Innovare - Group
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COUNTRY GUIDE » VIETNAM

Empower Your Business Expansion in Vietnam with Innovare

As one of the fastest-growing telecommunications and information technology hubs of Southeast  Asia,  companies look to Vietnam for business expansion today.

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Global Payroll Services Vietnam

Brief Overview

Innovare Vietnam

Innovare Vietnam, a dynamic arm of the Innovare Group, empowers seamless business expansion into Vietnam’s flourishing market. Leveraging our comprehensive Employer of Record (EOR) services, we ensure your venture’s smooth adaptation to the local business environment. Our deep-rooted expertise and unwavering commitment to compliance pave the way for your success in Vietnam.

  • Expert navigation through Vietnam's dynamic business landscape
  • Streamlined processes for employing foreign talent and managing payroll
  • Dedicated support for ensuring adherence to local laws and regulations
  • Specialised solutions for both expatriates and local professionals in Vietnam
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Global Payroll Services

Innovare helps you navigate Vietnam’s excessive bureaucracy.

Worry-free compliance and licensing requirements for relevant sectors.

Global Payroll Services

Fast-track the time-consuming setting up of business in Vietnam.

Let Innovare handle Vietnam’s cumbersome tax filings for you.

Local Expertise

Country-Specific Solutions

Onboarding

In Vietnam, a written employment contract outlining key terms must be provided to new hires within three months of their start date. This contract fosters transparency by clearly defining:

  • Job duties and expectations.
  • Work schedules to ensure mutual understanding.
  • Salary and payment details for transparency.
  • Probationary period (if applicable).
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HR Compliance Solutions
Payroll Services

The payroll cycle in Vietnam is monthly for full-time employees and is paid on the last working day or as agreed within the employment contract. Standard workweeks are 48 hours, with overtime capped at 40 hours per month. Timely tax filings are crucial, with specific deadlines for both hardcopy and electronic submissions.

  • Salary paid monthly by the last working day of the same month.
  • Standard workweek: 48 hours.
  • Overtime capped at 40 hours per month.
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Employer of Records

Taxes

Vietnam operates a progressive income tax system for residents and a flat rate for non-residents. All income derived from work performed in Vietnam is subject to taxation, regardless of payment location.

  • Residents: Progressive tax rates range from 5% to 35% in 2024, based on annual taxable income.
  • Non-Residents: Subject to a flat tax rate of 20% on gross salary income in 2024.
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Employer of Records
Leave

Vietnamese employees enjoy statutory leave benefits that promote work-life balance and employee satisfaction. These include:

  • Annual Leave: Minimum of 12 days, increasing with seniority (up to 14 days after one year).
  • National Holidays: 11 days off per year, depending on specific holidays observed.
  • Sick Leave: Up to 30 days paid leave with a medical certificate, paid by Social Security Fund.
  • Maternity Leave: 6 months paid leave for childbirth, paid by Social Security Fund.
  • Paternity Leave: Male employees are also entitled to paid leave of 5 days for normal delivery, 7 days if the baby is born by Caesarean section. For twin births, the leave allowance is increased to 10 to 14 days. For multiple births, 3 working days off are permitted for each baby after the third one. Salary for paternity leave is paid by the Social Security Fund.
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Global Payroll

Social Security Management

Vietnam’s social security system provides financial security for employees in retirement, disability, unemployment, and death. Mandatory contributions are made monthly by both employers and employees, based on a percentage of salary capped at a set amount.

  • Social Insurance (SI): Covers retirement pensions, salary for mandatory paid leaves except annual leaves and national holidays, unemployment benefits, and death allowances.
    Employer Contribution: 17.5% of salary (capped).
    Employee Contribution: 8% of salary (capped).
  • Health Insurance (HI): Provides coverage for medical expenses. Employer Contribution: 3% of salary (capped).
    Employee Contribution: 1.5% of salary (capped).
  • Unemployment Insurance: Provides a financial cushion to employees while they hunt for new opportunities. Unemployment insurance is applicable for local employees only, and not applicable for foreign employees.
    Employer Contribution: 1% of salary (capped).
    Employee Contribution: 1% of salary (capped at regional minimum wage).
  • Trade Union Employer Contribution: 2% of salary (capped).
    Employee Contribution: 0
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Global Payroll Services

Termination

‍Early termination before expiry of fixed term or indefinite term contract is not allowed unless due to grievous misconduct. Employer has to get consent from Employee with notice period to be observed. Bilateral agreement on compensation amount is required to avoid dispute.  Vietnam adheres to a termination process requiring adherence to designated notice periods.‍

Notice Period

  • Employer: only applicable when Employer may not renew the current contract when it comes to expiry.
  • 03 working days for seasonal or specific-job employment contracts with durations of less than 12 months.
  • 30 days for definite contract from 12-month to 36-month period.

Severance Payment

Vietnamese labour law requires employers to pay severance to legally terminated employees who had been regularly working for the employer for 12 months or more. The severance allowance is equal to one half of one month’s wage for each year of employment. Applicable with conditions that:

  • Employee who has worked on a regular basis for a period of at least 12 months, AND
  • The qualified period of work as the basis for calculation of severance allowance shall be the total period during which the employee actually worked for the employer minus the period over which the employee participated in the unemployment insurance and the period for which severance allowance or redundancy allowance has been paid by the employer.

Payment in lieu of notice is not allowed unless it is mutual agreement between Employer and Employee.

If Employer and Employee participated UI during the whole working period, Employer is not required to pay for Severance Allowance. Instead, Employee may claim his/her Unemployment Allowance from UI Fund provided that such claim is qualified under UI scheme. Otherwise, Employer will need to pay for such allowance or any shortfall, if applicable.

Global Payroll Services
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Vietnam Market
Insight

Economic Powerhouse

Vietnam boasts a rapidly growing economy, fueled by a young and skilled workforce, increasing domestic consumption, and a robust manufacturing sector.

Strategic Location

Vietnam’s strategic position in Southeast Asia makes it a gateway to the region, offering access to a vast and developing market for trade and investment.

Government Incentives

The Vietnamese government actively encourages foreign investment through competitive tax rates, the establishment of economic zones, and streamlined business registration processes.

Global Reach

Comprehensive Solutions, Tailored for You

Swiper Example
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FAQ

You've got questions, and we have the answers.

Assignment details with job location, job title and description, industry, gross monthly salary, intended start date, contract duration and candidate’s information. Candidate’s information should include nationality, educational level, Updated CV and brief job description.  Innovare will then provide free assessment and advice based on the Customer’s information.

No, we do not offer incorporation services in Vietnam but we can refer expert who provides such service to interested companies

After initial assessment, Customer to confirm on the eligibility of the candidate and solution chosen, and sign service contract with Innovare, Innovare will then start with onboarding process, including detailed guidelines on the procedure, preparing documents, monitoring the whole process until completed onboarding.

We will base on particular requirements from Customer to check and confirm if we are able to support or to give advices for Customer to explore.

Innovare will base on assignment details to advise on suitable type of visa and Work Permit (if any) that is suitable for candidate under the specific job requirements, complying with Vietnam law and regulations while saving cost for Client. 

Standard document list required for Visa and Work Permit as following: 

  1. Full scan copy of candidate’s passport
  2. Scan copies of previous Work Permits (if any)
  3. Scan copy of Education certificate (Bachelor’s degree or higher)
  4. Employment certificate(s) with at least 5-year experience in the same or relevant position that applying for new Work Permit
  5. Medical health check-up certificate
  6. Police Criminal Clearance
  7. ID photo – size 4x6cm for Visa and Work Permit, and size 2x3cm for Temporary Residence Card (if applicable)

Additional documents may be required by Officer on case- by- case basis. We shall advise Customer and candidate in case of any issue arises during the process.  

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