According to new regulations in the 2024 Law on Social Insurance, business households participating in compulsory social insurance are entitled to re-choose the salary level as a basis for contribution after a certain period of time.
Being able to re-choose the social insurance contribution salary level after 12 months
Based on Article 31 of the 2024 Law on Social Insurance, for groups of subjects who are allowed to choose salaries as the basis for compulsory social insurance contributions, the contribution salary level is not lower than the reference level and not higher than 20 times the reference level at the time of contribution.
After paying social insurance according to the selected salary level for a minimum of 12 months, participants have the right to re-choose the salary level as the basis for paying social insurance.
Thus, for business households that are subject to compulsory social insurance according to the provisions of the 2024 Social Insurance Law, after at least 12 months of contribution according to the previously chosen level, the salary level used as a basis for social insurance contributions can be changed.
The level of salary contributed must be within the prescribed framework
According to Article 31 of the 2024 Law on Social Insurance, the salary used as a basis for compulsory social insurance contributions is determined according to each group of participants.
In which, for groups selected for salary levels as the basis for social insurance contributions, the contribution level must be:
- Not lower than the reference level at closing time
- Not exceeding 20 times the reference level
This regulation aims to ensure flexibility for participants in choosing contribution levels suitable to their financial capacity, while still ensuring the right to enjoy long-term social insurance benefits.
Regulations on salaries for social insurance contributions by group of subjects
The 2024 Law on Social Insurance stipulates that the salary used as a basis for compulsory social insurance contributions is determined according to each specific group of subjects.
Specifically:
- For employees receiving salaries according to the salary regime prescribed by the State, the salary for social insurance contributions includes salary according to position, title, rank, grade or military rank and allowances according to regulations;
- For employees receiving salaries according to the salary regime decided by the employer, the salary for social insurance contributions includes the salary level according to the job or title, salary allowances and other supplementary amounts paid regularly and stably in each pay period;
- For some other groups of subjects according to the provisions of the Law, the salary level used as a basis for social insurance contributions is regulated by the Government;
- For the group of subjects who are selected for the salary level as the basis for compulsory social insurance contributions, the contribution level is implemented according to the principle of minimum equal to the reference level and maximum equal to 20 times the reference level.
According to this regulation, allowing the re-choosing of the minimum 12-month salary contribution level helps business households proactively adjust the contribution level to suit their financial conditions in each period, while still ensuring their rights when participating in compulsory social insurance according to the new regulations of the 2024 Social Insurance Law.
