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"He owns the company, so he's exempt from a work permit" is something many FDI companies hear. In practice, an exemption does not mean there is nothing to do. In most cases a written confirmation is still required, and tax and insurance obligations still follow. This guide on how to check correctly was compiled by the accounting services team at ACCA Consulting Vietnam.
1. Three routes: work permit, confirmed exemption, or no procedure
The rules on foreign workers divide employees into several groups. To keep things practical, accounting and HR can reduce them to the three routes below. The exact names and list of cases must be taken from the decree currently in force, as this content has changed through successive amendments.
| Route | Applies when | Documents usually required |
|---|---|---|
| Work permit | The person does not fall under any exempt case | Demand explanation, criminal record certificate, health certificate, degrees, proof of experience, passport, photos |
| Confirmation of not being subject to a work permit | The person falls under an exempt case, but the rules require a written confirmation | Request letter, documents proving the exempt case, passport, photos |
| No confirmation procedure | Certain special cases under the rules; a notification may be sufficient | Notification before starting work (if required), supporting documents |
Illustrative count based on the summary table above; the actual list depends on each case and current regulations.
View as table
| Work permit | 7 loại giấy tờ |
| Confirmation of exemption | 4 loại giấy tờ |
| No procedure | 2 loại giấy tờ |
2. Common work permit exemptions in FDI companies
Owners, capital-contributing members and board members
An investor who is the owner or a capital-contributing member of a limited liability company, or the chairman or a board member of a joint stock company, may not be subject to a work permit if the value of their capital contribution reaches the statutory threshold. Check two points: whether the contribution is measured as registered capital or capital actually paid in, and whether the person also holds another executive title.
Intra-corporate transferees
Managers, executive directors, experts and technical workers seconded by a group to its commercial presence in Vietnam, within the service sectors covered by Vietnam's WTO commitments, may be exempt. Conditions usually include a minimum period of prior employment within the group and an assignment letter. You need to check whether the Vietnamese company's business lines are included in the schedule of commitments.
Short-term work
People entering Vietnam to offer services, resolve complex technical incidents, or work for a short total period within the year may be exempt, subject to the statutory time and frequency thresholds. Companies should keep a log of each person's entry and exit dates to provide evidence when needed.
3. How to check a specific case correctly
- 1Identify the actual role
Is the person an investor, manager, expert or technical worker, and how long will they work?
- 2Look up the current rules
Read the decree on foreign workers currently in force and its amendments; do not rely on old articles.
- 3Check each condition
Record which conditions are supported by documents and which are still missing.
- 4Determine the procedure
Does this exempt case require a written confirmation or only a notification?
- 5File and set reminders
Keep the result with the HR file and set a reminder before the confirmation expires.
4. Common misconceptions about work permit exemptions
- "Exempt means nothing to do": many cases still require a written confirmation, and that confirmation has a validity period.
- "Exempt means no insurance contributions": compulsory insurance coverage is assessed under its own conditions, not automatically based on work permit status.
- "No work permit means no PIT withholding": income from work performed in Vietnam remains subject to personal income tax (PIT/TNCN) according to the person's residence status.
- "One confirmation lasts forever": a change of title, capital ownership percentage or employer can all remove the grounds for exemption.
- "A business visa is enough to work": a visa only permits entry for a stated purpose; it does not replace a work permit or a written confirmation.
5. Accounting obligations remain the same
- Hold an employment contract, appointment letter or assignment decision as the basis for paying salary.
- Register a PIT code and withhold tax monthly.
- Determine the employee's tax residence status to apply the correct calculation method.
- Assess compulsory insurance coverage under current conditions.
- Keep the confirmation together with payroll records to support the expense at the corporate income tax (CIT/TNDN) finalization.
FAQ
Does the confirmation of not being subject to a work permit expire?
Yes. The confirmation usually has a validity period set by the rules and by the expected period of work. Once it expires, the company must apply again if the employee continues to work.
What if a foreign board member also serves as executive director?
Each title needs to be assessed. The exemption for board members may not cover an executive role, so check carefully and ask the licensing authority if anything is unclear.
If exempt from a work permit, is a temporary residence card still needed?
The temporary residence card is a separate immigration procedure. The confirmation of not being subject to a work permit is usually one of the documents used to apply for the appropriate card.
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ACCA Consulting Vietnam supports payroll, PIT and insurance for expats. Accounting services based in Ho Chi Minh City, working remotely with FDI companies nationwide.
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