Are allowances for convalescence and health rehabilitation after maternity leave period subject to personal income tax in Vietnam?

Are allowances for convalescence and health rehabilitation after maternity leave period subject to personal income tax in Vietnam?

In Clause 2, Article 2, Circular 111/2013/TT-BTC has regulations on taxable incomes as follows:

Taxable income

According to Article 3 of the Law on Personal income tax and Article 3 of the Decree No. 65/2013/ND-CP, the incomes subject to personal income tax (hereinafter referred to as taxable incomes) include:

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2. Incomes from wages and remunerations.

Incomes from wages and remunerations (hereinafter referred to as wages) are incomes paid to employees from employers, including:

a) Wages, remunerations, and the other amounts paid as wages or remunerations in cash or not in cash.

b) Allowances and benefits, except for:

b.1) Monthly benefits, lump-sum benefits and allowances according to regulations of law on incentives for contributors.

b.2) Monthly allowances and lump-sump allowances for the persons that participate in the resistance movements, national defense, fulfillment of international tasks, and discharged volunteers.

b.3) Benefits for national defense and security; subsidies for the armed forces.

b.4) Benefits for dangerous or harmful works.

b.5) Benefits for employees in disadvantaged areas.

b.6) Irregular allowances for difficulties, occupational accident benefits, occupational illness benefits, lump-sum allowances for childbirth or adoption, maternity leave benefits, post-maternity recovery benefits, benefits for reduction in work ability, lump-sum pension, monthly widow’s pension, severance pay, redundancy pay, unemployment benefits, and other benefits according to the Labor Code and the Law on Social insurance.

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Thus, the employee's post-maternity recovery benefits are income that is not subject to personal income tax in Vietnam.

In addition, irregular allowances for difficulties, occupational accident benefits, occupational illness benefits, lump-sum allowances for childbirth or adoption, maternity leave benefits, post-maternity recovery benefits, benefits for reduction in work ability, lump-sum pension, monthly widow’s pension, severance pay, redundancy pay, unemployment benefits, and other benefits according to the provisions of the Labor Code and the Social Insurance Law Personal income tax will also not be calculated as PIT in Vietnam.

Are allowances for convalescence and health rehabilitation after maternity leave period subject to personal income tax in Vietnam? (Image from the Internet)

In case leave period for convalescence and health rehabilitation in Vietnam lasts from the end of a year to the following year, which year is this leave counted for?

Clause 1, Article 41 of the 2014 Law on Social Insurance stipulates the convalescence and health rehabilitation after the maternity leave period as follows:

Convalescence and health rehabilitation after the maternity leave period

1. Female employees whose health has not yet recovered within the first 30 working days after the maternity leave period specified in Article 33, or Clause 1 or 3, Article 34, of this Law, are entitled to a leave for convalescence and health rehabilitation of between 5 and 10 days.

The leave period for convalescence and health rehabilitation is inclusive of public holidays, New Year holidays and weekends. The leave period for convalescence and health rehabilitation which lasts from the end of a year to the following year shall be counted for the previous year.

Thus, in case leave period for convalescence and health rehabilitation which lasts from the end of a year to the following year shall be counted for the previous year in Vietnam.

If my labor contract is terminated before childbirth, will I still be entitled to maternity benefits in Vietnam?

Article 31 of the 2014 Law on Social Insurance stipulates conditions for enjoying the maternity benefits as follows:

Conditions for enjoying the maternity benefits

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4. Employees who fully satisfy the conditions specified in Clause 2 or 3 of this Article and terminate their labor contracts or working contracts or cease working before the time of childbirth or the time of adoption of under-6-month children are still entitled to the maternity benefits prescribed in Articles 34, 36 and 38, and Clause 1, Article 39, of this Law.

Thus, in case of terminating the labor contract before childbirth in Vietnam, you will still be entitled to maternity benefits if all the prescribed conditions are met.

Best regards!