Compulsory social insurance is one of the employer's responsibilities. However, if the business activities are not favorable, are enterprises allowed to own the premiums of insurance?
1. What is the payment term for social insurance?
In accordance with the Article 85, Law on Social Insurance 2012, employers and employees must use part of wage and wage funds for compulsory social insurance. All the insurance premiums shall be deducted to the district-level social insurance agencies where enterprises are located.
Payment methods are prescribed in accordance with the Article 7 of the Decision No. 595/QD-BHXH amended by the Clause 13, Article 1 of the Decision No. 505/QD-BHXH as follows:
* Monthly payment:
Term of payment for social insurance: No later than the last day of the month.
At this time, the employers shall make deductions from monthly salary as the basis for payment of compulsory social insurance of each employee at prescribed rate and transfer them at the same time to the collecting account opened at the state banks or treasuries by the social insurance authorities.
* Quarterly or biannual payment
Term of payment for social insurance: No later than the last day of the term of payment.
The employer shall fully transfer money to the social insurance funds.
2. How long do enterprises own the premiums of social?
In accordance with the Clause 2, Article 17, the Law on Social insurance 2014, delaying the payment of social insurance or unemployment insurance premiums is one of prohibited acts prescribed by laws.
Clause 3, Article 22, the Law on Social Insurance 2014 prescribes on handling of violations of the law on social insurance
3. Employers that violate Clause 1, 2 or 3, Article 17 of this Law for 30 days or more shall not only fully pay the amount not yet paid or paid late and be handled in accordance with law but also pay an interest equaling 2 times the average interest rate of investment from the social insurance fund in the preceding year, calculated based on the late paid amount and late payment period. If they fail to do so, at the request of competent persons, related banks, credit institutions or state treasuries shall deduct money from the employers’ deposit accounts in order to pay the amount not yet paid or paid late and the interest thereon to the accounts of social insurance agencies.
Accordingly, employers can be late in paying the premiums of social insurance for under 29 days in accordance with legal regulations. Enterprises that delay the payment of social insurance or unemployment insurance for 30 days, enterprises not only pay the amount not yet paid or paid late and be handled in accordance with law but also pay an interest
The interest rate is paid equaling 2 times the average interest rate of investment from the social insurance fund in the preceding year, calculated based on the late paid amount and late payment period.
Pursuant to the Notice No. 89/TB-BHXH dated January 13, 2022 of the Vietnam Social Insurance, the interest rate for late payment in social insurance in 2022 shall be as follows:
Types of insurance
The interest rate for late payment of social insurance in 2022
Social insurance, unemployment insurance
3. What are the fines for late payment of social insurance?
As mentioned in the Section 1, employers that shall not only fully pay the amount not yet paid or paid late for 30 days or more shall be handling of violations as prescribed. Pursuant to Point a, Clause 5, Article39 of the Decree No. 12/2022/ND-CP, the fines for employers are prescribed as follows:
5. A fine equal to between 12% and 15% of the total compulsory social insurance and unemployment insurance premiums at the time of making a minute of administrative violations, with the total fine of no more than VND 75,000,000, shall be imposed on any employer that commits one of the following acts:
a) Failing to pay compulsory social insurance and unemployment insurance premiums on schedule;
With the provisions prescribed in Clause 1, Article 6 of the Decree 12/2022, a fine equal to between 12% - 15% of the total compulsory insurance with a total fine of no more than VND 75 million for the employers are individuals.
Within that, a fine equal to between 24% - 30% of the total compulsory insurance with a total fine of no more than VND 150 million for the employers are organizations.