Vietnam: Salary and bonus for Gregorian Calendar New Year 2021 and things that everyone should know

1. Fully paid day off on Gregorian Calendar New Year Holiday 2021

According to Point a Clause 1 Article 112 of the Labor Code 2019 of Vietnam (effective from January 01, 2021), employees shall be entitled to 01 fully paid day off on Gregorian Calendar New Year Holiday (Friday, January 01, 2021).

Thus, as usual, shall be entitled to 01 fully paid day off on Gregorian Calendar New Year Holiday - January 01, 2021.

2. Several forms of bonus for Gregorian Calendar New Year 2021

According to Article 104 of the Labor Code 2019 of Vietnam, a bonus means an amount of money, a piece of property or item that is provided by an employer for his/her employees on the basis of the business performance or the employees’ performance. A bonus regulation shall be decided and publicly announced at the workplace by the employer after consultation with the representative organization of employees (if any).

In fact, enterprises have also previously applied many forms of New Year bonuses for employees such as bonuses, extra days of leave, confectionery, travel, etc. From 2021, forms of bonus will be specified in the Labor Code 2019 (previously only stipulating bonuses in cash).

3. Bonus for Gregorian Calendar New Year 2021 shall subject to personal income tax

According to Point e Clause 2 Article 2 of Circular No. 111/2013/TT-BTC of the Ministry of Finance of Vietnam, rewards in cash or not in cash in any shape or form, including rewards in the form of securities shall subject to personal income tax, except for bonuses attached to certificates of merit, diplomas of merit, medals and prizes conferred by the State.

Concurrently, according to Resolution No. 954/2020/UBTVQH14 of the Standing committee of the National Assembly of Vietnam, personal exemption is 11 million VND/month (132 million VND/year), dependent exemption is 4,4 million VND/dependent/month.

Thus, according to the above provisions, employees who receive Tet bonuses must pay personal income tax. However, employees only have to pay Tet bonus tax after deducting the exemptions, but it is still positive.

4. Working on New Year's Day 2021 shall be paid 400% of the salary

According to Clause 1 Article 98 of the Labor Code 2019 of Vietnam, employees who go to work on New Year's Day shall be counted as overtime and be paid as follows:

- At least 300%, not including the daily salary during the public holidays or paid leave for employees receiving daily salaries.

- An employee who works at night will be paid an additional amount of at least 30% of the normal salary.

- An employee who works overtime at night will be paid, in addition to the salary specified in above, an amount of at least 20% of the day work salary of a normal day, weekend or public holiday.

Thus, employees who go to work on New Year's Day shall be paid at least 400% of the normal salary.

Le Vy

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