LABOR REGULATIONS UPDATE IN AUGUST 2026

GUIDANCE ON SALARY USED AS THE BASIS FOR COMPULSORY SOCIAL INSURANCE CONTRIBUTIONS

On 31 July 2026, the Ho Chi Minh City Social Security Office issued Official Letter No. 6101/BHXH-QLT in response to a request for clarification on the guidance provided under Official Letter No. 4916/BHXH-QLT dated 30 June 2026 of the Ho Chi Minh City Social Security Office regarding salary used as the basis for compulsory social insurance contributions.

The Official Letter provides that telephone, transportation and housing allowances, if recorded as separate items in the labor contract as other benefits/welfare and not as salary, shall not be used as the basis for compulsory social insurance contributions, even if they are paid on a fixed and regular monthly basis.

Accordingly, other benefits and welfare items, if recorded as separate items in the labor contract in accordance with regulations, shall not be considered salary used as the basis for compulsory social insurance contributions.

With this new guidance, Talentnet recommends that Clients review the items set out in labor contracts/contract appendices, salary and bonus/welfare policies, payroll, accounting treatment and actual payment practices before applying the social insurance contribution basis.

GUIDANCE ON THE CONVERSION TO USE PERSONAL IDENTIFICATION/CITIZEN IDENTIFICATION NUMBERS TO REPLACE COMPULSORY SOCIAL INSURANCE CODES

On 13 August 2026, Vietnam Social Security issued Plan No. 3115/KH-BHXH on the conversion to use personal identification numbers (PIN)/citizen identification card numbers (CIC) to replace social insurance codes and management codes on Vietnam Social Security’s operational software systems.

The Plan clarifies that the conversion process will be implemented under the principle of not changing the history of previously generated records, documents and operational data, while ensuring safety, accuracy, no disruption to operations, and no impact on participants’ entitlements when receiving social insurance, health insurance and unemployment insurance benefits.

Accordingly, data standardization (Phase 1) will be carried out from 15 August 2026 to before 1 September 2026, and data conversion and official operation (Phase 2) will begin from 1 September 2026.

With this new guidance, Talentnet recommends that Clients proactively review and standardize employee information data, including PIN/CIC number, full name, date of birth and gender, before 1 September 2026 to minimize cases where data is not eligible for automatic conversion.

GUIDANCE ON PERSONAL INCOME TAX (PIT)

1. SEVERANCE SUPPORT PAYMENT

On 3 August 2026, the Tax Department issued Official Letter No. 5493/CT-CS providing guidance on personal income tax (PIT) policy and clarifying the PIT treatment of support payments made to employees upon termination under a labor restructuring plan.

Accordingly, severance support payments made under an enterprise’s internal policy may still be treated as taxable PIT income if they do not fall within the statutory excluded allowances.

2. SALARY AND WAGES PAID FOR UNUSED ANNUAL LEAVE DAYS

On 3 August 2026, Khanh Hoa Tax Authority issued Official Letter No. 4138/KHH-QLDNI responding to questions on PIT applicable to salary and wages paid for unused annual leave days upon an employee’s resignation or job loss.

Accordingly, where payments for unused annual leave days after termination of the labor contract satisfy the conditions under Clause 3, Article 113 of the Labor Code, such payments are treated as PIT-exempt income under the Law on PIT and Decree No. 253/2026/NĐ-CP. For annual leave days exceeding the statutory entitlement under the Labor Code, if any, the corresponding payments must be included in taxable income.

3. PAYMENTS MADE AFTER TERMINATION OF EMPLOYMENT

Regarding payments made after termination of employment, Official Letter No. 2563/TCS14-QLDN2 dated 14 July 2026 of Tax Office No. 14 of Ho Chi Minh City, Official Letter No. 10049/NBI-QLDNI dated 3 August 2026 of Ninh Binh Tax Authority, Official Letter No. 6661/QNG-QLDN1 dated 6 August 2026 of Quang Ngai Tax Authority, and Official Letter No. 15676/DON-QLDN1 dated 14 August 2026 of Dong Nai City Tax Authority clarify the 10% PIT withholding applicable to salary and wages paid to employees who have terminated their labor contracts.

Accordingly, for salary, wages, remuneration or other payments made after an employee has terminated the labor contract, enterprises should consider the threshold of VND 5 million per payment for applying the 10% withholding, except for PIT-exempt income or cases where the individual has a valid commitment for temporary non-withholding. Please note that local tax authorities currently hold different views on whether the withholding should be applied to total income or taxable income.

As these are guidelines issued by local tax authorities, Talentnet recommends that Clients continue to monitor further guidance from the Tax Department/General Department of Taxation for a consistent implementation basis.

For detailed guidance, kindly refer to the attached Official Letter No. 2563/TCS14-QLDN2, Official Letter No. 10049/NBI-QLDNI, Official Letter No. 6661/QNG-QLDN1 and Official Letter No. 15676/DON-QLDN1.

DECREE NO. 293/2026/NĐ-CP GUIDING THE IMPLEMENTATION OF THE HAGUE CONVENTION OF 5 OCTOBER 1961 ABOLISHING THE REQUIREMENT OF LEGALIZATION FOR FOREIGN PUBLIC DOCUMENTS (APOSTILLE CONVENTION)

On 23 July 2026, the Government issued Decree No. 293/2026/NĐ-CP guiding the implementation of the Hague Convention of 5 October 1961 abolishing the requirement of consular legalization for foreign public documents (Apostille Convention).

Accordingly, Vietnamese public documents may be issued with an Apostille certificate upon request by agencies, organizations or individuals for use in a Contracting State of the Convention that has applicable relations with Vietnam. The issuance of an Apostille certificate is not mandatory if the public document is exempt from or not required to undergo certification or authentication under an international treaty to which the Socialist Republic of Vietnam is a party, or under the laws or applicable practices of the country where the document is used.

The types of Vietnamese public documents eligible for Apostille certification include:

• Administrative documents, including civil status, nationality and adoption documents; criminal record certificates; diplomas, certificates and confirmations of study or research results; health examination certificates, medical certificates, medical assessment conclusions and other medical documents; and other administrative documents issued or certified by state agencies or organizations delegated or authorized by the State to provide public services in accordance with the law;
• Procedural and judgment enforcement documents, including judgments, decisions and procedural documents of People’s Courts, People’s Procuracies and investigation authorities; decisions, minutes and documents of civil judgment enforcement management agencies, civil judgment enforcement agencies and criminal judgment enforcement agencies; bailiff’s records and other documents prepared by bailiffs or enforcement officers in the performance of their duties;
• Notarized documents, including contracts, transactions, translations and notarized copies;
• Certified documents, including certified true copies, certification of signatures, certification of translators’ signatures, and certification of contracts and transactions;
• Other public documents made, issued or certified by Vietnamese agencies, organizations or competent persons in the performance of their functions and duties in accordance with the law.

There are two methods for submitting applications for Apostille certification:

1. Direct submission at the single-window division or submission by postal service;

2. Online submission via the National Public Service Portal or the national identification application.

The Decree provides that the Ministry of Foreign Affairs is the competent authority for issuing Apostille certificates of Vietnam. In addition, Apostille certification does not replace notarization or certification as required by law where the public document is used in Vietnam.

Sincerely,
Talentnet Corporation