The State will support voluntary social insurance payments from 2018.

The Government has just issued a Decree on the implementation of voluntary social insurance. In addition to the regulations on retirement and death benefits similar to Decree 115/2015/ND-CP on compulsory social insurance, the new Decree has many advantages in terms of flexible methods and time of social insurance payment, no age limit for participation, and participants are supported by the State.

Receiving and processing applications for social insurance participants. (Photo: Duong Ngoc/VNA)

The basic difference between voluntary social insurance regulations and compulsory social insurance is that the participation mechanism only has employees paying social insurance and employees only participate in two retirement and death benefit regimes corresponding to the contribution rate of 22% of the salary used for social insurance contribution.

The State supports voluntary social insurance contributions

Voluntary social insurance participants are supported by the State with payment at a percentage (%) of the monthly social insurance payment according to the poverty line in rural areas.

For voluntary social insurance participants from poor households, 30% of social insurance premiums are supported, for voluntary social insurance participants from near-poor households, 25%, and for other subjects, 10% is supported.

Based on socio-economic development conditions and state budget capacity in each period, the Government will consider adjusting the level of support for voluntary social insurance participants accordingly.

The support period will be 10 years of voluntary social insurance participation for each person. This support regulation is applied from January 1, 2018.

Flexible participation methods

Voluntary social insurance participants can choose one of the following payment methods: monthly, every 3 months, every 6 months or every 12 months, or one-time payment for many years in the future but not more than 5 years at a time.

If the participant's remaining social insurance payment period is less than 10 years (120 months), he/she can pay for the full 20 years to receive pension. The payment will be made once for the remaining years provided that the participant meets the age standard to receive pension according to regulations.

If a social insurance participant has reached the prescribed retirement age but the social insurance payment period is still short of more than 10 years, he/she can continue to pay voluntary social insurance according to one of the above-mentioned methods until the payment period is not more than 10 years. At that time, the voluntary social insurance participant can pay a lump sum for the remaining years to receive a pension.

The monthly contribution is equal to 22% of the monthly income chosen by the voluntary social insurance participant. The monthly income chosen by the voluntary social insurance participant is at least equal to the poverty line for rural areas as prescribed by the Prime Minister and at most equal to 20 times the basic salary at the time of contribution.

Cases eligible for a refund of voluntary social insurance contributions include: Receiving one-time social insurance, dying or being declared dead by the court, stopping voluntary social insurance participation and switching to compulsory social insurance participation. The refunded amount is calculated based on the amount paid but does not include the State's support payment (if any).

The Decree takes effect from January 1, 2016. In particular, the State's support for social insurance contributions for voluntary social insurance participants will be implemented from January 1, 2018.

According toVIETNAM+