VINA BOOKKEEPING – UPDATE: 6 KEY POINTS OF DECREE NO. 105/2026/ND-CP ON TRADE UNION FEES
1. Maintenance of the 2% Contribution Rate – Irrespective of Trade Union Establishment
- Contribution Rate: Maintains the rate of 2% of the salary fund used as the basis for compulsory Social Insurance (SI) contributions.
- Applicability: All enterprises employing workers subject to compulsory Social Insurance must pay this fee.
- Note: The obligation remains unchanged regardless of whether the enterprise has established a grassroots Trade Union or not.
2. Synchronization of Payment Deadlines with Social Insurance
- Deadline: No later than the last day of the following month.
- Mechanism: Trade union fee payments are made concurrently with the monthly Social Insurance contribution period. This synchronization helps enterprises manage cash flow effectively and prevents reconciliation errors between the two regulatory bodies.
3. Reduction of Contribution Rates by up to 20% (A Breakthrough New Point)
- Enterprises facing difficulties after the expiration of a payment suspension period, yet still forced to implement large-scale labor reductions, are eligible for a reduced rate of 1.6% (a 20% reduction of the 2% rate).
- Quantitative Conditions: Labor reductions ranging from 30 employees (for small enterprises) to over 100 employees (for large enterprises).
- Application Period: Maximum of 06 months.
4. Additional Conditions for Payment Suspension (Up to 12 Months)
- Applicable to enterprises encountering force majeure risks (natural disasters, epidemics) or undergoing technological restructuring.
- Key Condition: Production is suspended for more than 30 days and over 50% of employees subject to compulsory SI are required to take leave.
5. Transparent Accounting Guidelines
- Trade union fees are deducted from the enterprise’s financial resources and recorded directly as operating expenses in the period.
- Value to Enterprises: This serves as a solid legal basis for accountants to recognize deductible expenses for Corporate Income Tax (CIT) finalization.
6. Strict Penalties and Arrears Collection
- Penalty Rate: From 18% to 20% of the total late or evaded amount.
- Consequences: In addition to administrative fines (up to 75 million VND), enterprises are mandatory required to pay the full principal amount and all outstanding arrears.
EFFECTIVE DATE
Decree No. 105/2026/ND-CP officially takes effect from May 16, 2026. From this date, all regulations regarding the payment, exemption, and reduction of trade union fees shall comply with the new provisions stated above, replacing Decree No. 191/2013/ND-CP.
Please refer to the detailed guidance documents below:
• Vietnamese version
• English version
• Japanese version
VINA BOOKKEEPING is always ready to support our clients in reviewing and implementing procedures related to trade union fees in accordance with the latest regulations.
