Working in Vietnam as an Expat: Quick Guide (2022)
Vietnam has become a popular destination for expatriates from around the world. Its booming economy has a seemingly unquenchable thirst for skills and as a result wages for foreign workers are well above the local market value.
It’s also rich in culture and tradition, verdant landscapes, and a whole plethora of good foods. Not only that, but it is also very cheap. It’s these factors combined that make working as an expat in Vietnam very attractive.
There are, however, a number of technical and bureaucratic hurdles foreigners intending to live and work in Vietnam should understand before they move to the up and coming Southeast Asian nation.
Working in Vietnam
Working in Vietnam requires a work visa. There are a number of visas with which an expat will be able to work.
The most common form of visa for an expat is a standard work permit. This is known as an LD visa officially. It generally lasts for two years and is tied to the expat’s employer. This means that when an expat leaves their job they will lose their work permit.
Investor visas allow expats investing in Vietnam to live and work in the country. These are divided into categories based on the volume of the investor’s investment. The length of time for which an investor visa is issued is also tied to the size of the investment. The breakdown is as follows:
- More than US$2.17 million = 5 years
- More than US$135,500 to US$2.17 million. = 3 years
- Less than US$135,500 = 1 year
NGO workers also have their own specific visa type. This is coded NN by the Ministry of Labor, Invalids and Social Affairs (MoLISA).
For more information see: Vietnam’s Visas and Work Permit Procedures
Vietnamese labor contracts
Wages for foreign workers in Vietnam are typically higher than the wages of domestic workers. HSBC’s 11th Expat Explorer survey issued in 2018 found that the average wage of respondents working in Vietnam was US$90,408.
Vietnam’s low cost of living also makes these wages go much further. The same HSBC survey found that 72 percent of respondents were also able to save more after moving to Vietnam.
Employees in Vietnam are generally entitled to 12 days of annual leave per year. On top of that there are a total of 11 public holidays.
Foreign workers are also entitled to an additional public holiday for their own national day and one other traditional public holiday of their country.
|Gregorian Calendar New Year Holiday
|Lunar New Year Holidays
|Varies. The actual holiday dates are at the discretion of the Prime Minister.
|International Labor Day
|September 2, plus the day before or after at the discretion of the Prime Minister.
|Hung Kings Commemoration Day
In Vietnam, compulsory social security can be broken down into three categories: social insurance, medical insurance, and unemployment insurance.
All employers in Vietnam must pay social security for employees on labor contracts, either definite or indefinite. Likewise, employees are also compelled to make contributions to their own social security funds.
For more information see: Foreign Employees Subject to Increased Social Insurance Rates from January 2022
Investing in Vietnam
Setting up a business in Vietnam
Many expats find Vietnam a great place to live and work. However, there are a plethora of opportunities for investors. Opening hospitality venues like bars, restaurants, and cafes in Vietnam is very popular with expats. It can be relatively cheap to do and can be a great side project.
There are, however, a number of steps that need to be followed. This includes tax registration, seal carving, opening a bank account, labor registration, business license tax payment, charter capital contribution, and the public announcement of the establishment of the company
For more information see: Key Steps for Setting Up a Business in Vietnam.
Starting an non-governmental organization (NGO)
There are myriad opportunities to make money in Vietnam for foreign investors. However, Vietnam is a developing country, and the needs of its people go beyond simply investment.
Many expats have set up NGOs in Vietnam already, but there is still more work to be done.
Establishing an NGO in Vietnam can be a fulfilling and worthwhile experience, but there are rules and regulations specific to this sector. Expats that intend to establish an NGO should understand the requirements thoroughly and abide by the criteria put forth by the government of Vietnam.
For more information see: How to Set Up an NGO in Vietnam
Paying tax in Vietnam
Personal Income Tax
Determining how much PIT should be paid involves understanding a number of regulations and rules embedded in Vietnam’s tax code. Foreign workers in Vietnam should be careful to calculate their liability accurately and fully.
For more information see: Personal Income Tax in Vietnam: Exemptions and Reductions
Foreign Contractor Tax
Foreign companies dealing with Vietnamese companies may need to pay foreign contractor withholding tax. This tax is somewhat complex with a number of exemptions and different ways to calculate exact liability.
For more information see: Vietnam’s Foreign Contractor Withholding Tax: Complete Guide
Working in Vietnam: Challenging but Rewarding
Overall, working in Vietnam as an expat can be a very rewarding experience. The low-cost of living and high-wages for foreign workers can make saving money easy. Vietnam can also serve as a gateway to Asia with expats given the opportunity to travel throughout the region cheaply and easily.
That said, getting set up in Vietnam as an expat can be tricky. Acquiring work permits and investment visas can be overly bureaucratic and the same goes for starting a business or an NGO. With the right support and advice, however, the process can also be incredibly smooth.
Vietnam Briefing is published by Asia Briefing, a subsidiary of Dezan Shira & Associates. We produce material for foreign investors throughout Eurasia, including ASEAN, China, India, Indonesia, Russia & the Silk Road. For editorial matters please contact us here and for a complimentary subscription to our products, please click here.
Dezan Shira & Associates provide business intelligence, due diligence, legal, tax and advisory services throughout the Vietnam and the Asian region. We maintain offices in Hanoi and Ho Chi Minh City, as well as throughout China, South-East Asia, India, and Russia. For assistance with investments into Vietnam please contact us at firstname.lastname@example.org or visit us at www.dezshira.com
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