Are lump-sum allowances for childbirth subject to personal income tax in Vietnam?

Are lump-sum allowances for childbirth subject to personal income tax in Vietnam?

Pursuant to Point b, Clause 2, Article 2 of Circular 111/2013/TT-BTC, which stipulates that 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.

b.7) Benefits for beneficiaries of social security.

b.8) Benefits for senior officers.

b.9) Lump-sum benefits for the persons reassigned to the areas facing extreme economic and social difficulties, lump-sum supports for officers working for sovereignty over sea and islands as prescribed by law. Lump-sum moving allowances for foreigners that move and reside in Vietnam and Vietnamese people that go to work abroad.

b.10) Benefits for medical employees in villages.

b.11) Occupational benefits.

The allowances and benefits that are not included in taxable incomes as guided in Point b Clause 2 of this Article must be defined by competent authorities.

If the documents on the levels of allowances and benefits are applicable to the public sector, other economic sectors and businesses shall make calculate allowances and benefits based on such documents.

If the actual benefits and allowances received are in excess of the levels stated above, the excess shall be included in taxable incomes.

Lump-sum moving allowances for foreigners that reside in Vietnam and Vietnamese people working overseas shall be deducted in accordance with the labor contract or collective bargaining agreement.

Thus, according to the above regulations, you receive a lump-sum allowance when you give birth, this allowance will not be a taxable income for personal income in Vietnam.

How much lump-sum allowances are employees who gives birth in Vietnam?

Pursuant to Article 38 of the Law on Social Insurance 2014 has the following provisions:

Female employees giving birth or employees adopting an under-6-month child are entitled to a lump-sum allowance equaling 2 times the statutory pay rate for each child in the month of childbirth or child adoption.

In case the mother gives birth to a child but only the father is covered by social insurance, the father is entitled to a lump-sum allowance equaling 2 times the statutory pay rate for each child in the month of childbirth.

According to this Article, when you give birth while participating in social insurance, you will be entitled to a lump-sum allowance equaling 2 times the statutory pay rate for each child in the month of childbirth in Vietnam.

Best Regards!