Singapore and Vietnam are two of Southeast Asia’s most prominent business hubs, but the way each country structures employee contributions, healthcare protection and retirement savings is quite different. The CPF Board (Singapore) administers the city-state’s retirement and healthcare savings scheme, while the mandatory social, health and unemployment insurance schemes in Vietnam are governed by Vietnamese law.
For a Singapore business considering Vietnam, understanding these differences matters because employee costs do not stop at the salary stated in an employment contract. Mandatory contributions, payroll administration, benefits and the treatment of foreign employees can all affect the actual cost of employing someone. We covered what employers need to register and pay in fuller detail in our guide to mandatory social insurance in Vietnam. Our GST versus VAT comparison looks at how the same tax concept takes a different form in each country.
TL;DR – Singapore’s CPF combines employer and employee contributions into one savings framework covering retirement, healthcare and other uses. Vietnam’s SHUI splits these functions across three separate mandatory schemes, so headline percentages cannot be compared like-for-like without looking at what each system covers.
How Do CPF and Vietnam’s SHUI Systems Work?
The Central Provident Fund (CPF) is Singapore’s compulsory social security savings system. CPF applies to Singapore citizens and permanent residents, with both employees and employers contributing at rates that depend on the employee’s age; permanent residents contribute at lower graduated rates in their first two years and at full rates from their third year onwards.
CPF Contribution Rates 2026
For an employee aged 55 or below earning more than S$750 per month, the 2026 CPF rate is 20% from the employee and 17% from the employer, giving a total contribution of 37%. The CPF Ordinary Wage ceiling is S$8,000 per month from January 2026, while the annual salary ceiling remains S$102,000. CPF Board’s 2026 contribution tables provide the detailed rates by age and wage level.
Vietnam’s mandatory payroll contributions are known as SHUI (Social, Health and Unemployment Insurance) and work differently. Under the framework effective from 1 July 2025, compulsory social insurance covers benefits including sickness, maternity, occupational accidents and diseases, retirement and survivorship.
The two key instruments are Vietnam’s 2024 Social Insurance Law, which took effect on 1 July 2025, and Decree 158/2025.
Vietnam Social Insurance (SHUI) Rates 2026
For a typical Vietnamese employee, social insurance is only one part of the mandatory payroll system. SHUI is made up of three separately administered schemes:
| Scheme | Employer | Employee | What It Covers |
|---|---|---|---|
| Social insurance (BHXH) | 17.5% | 8% | Sickness, maternity, occupational accidents and diseases, retirement, survivorship |
| Health insurance (BHYT) | 3% | 1.5% | Medical treatment and routine check-ups |
| Unemployment insurance (BHTN) | 1% | 1% | Job-loss allowance and retraining support (capped base) |
| Total | 21.5% | 10.5% |
A business therefore needs to consider the combined statutory contribution burden rather than comparing the CPF rate directly with the social insurance rate.
How Do the Contribution Structures Compare?
Employer vs Employee Contributions
For a 30-year-old employee, the basic structure can be illustrated as follows:
| 2026 contribution structure | Singapore CPF | Vietnam social insurance |
|---|---|---|
| Employee contribution | 20% | 8% |
| Employer contribution | 17% | 17.5% |
| Total shown above | 37% | 25.5% |
| Health insurance (separate scheme) | Covered by MediSave within CPF | 3% employer, 1.5% employee |
| Unemployment insurance (separate scheme) | No statutory scheme | 1% employer, 1% employee (capped base) |
The figures above are not directly equivalent benefits. Singapore’s CPF contribution is allocated across CPF accounts, including the Ordinary Account and MediSave, with retirement savings later supporting the Retirement Account and CPF LIFE. CPF’s retirement structure therefore combines several functions within one broader system.
Vietnam separates these functions across different schemes. This is why looking only at the 8% employee and 17.5% employer social insurance rates can give an incomplete picture of the employer’s overall statutory payroll cost.
Contribution Caps and Salary Ceilings
The contribution base also differs. Singapore applies CPF to wages subject to the relevant CPF ceilings. Vietnam’s contribution calculation can include contractual salary, qualifying allowances and certain regular additional amounts, such as position or seniority allowances and regular monthly bonuses agreed in the employment contract, subject to statutory limits. Vietnam Social Security’s 2026 guidance explains how the salary base is determined under the current rules.
What Does This Look Like in Practice?
Consider a 30-year-old employee earning S$5,000 per month in Singapore, and a 30-year-old Vietnamese employee earning VND 40 million per month. At the standard 2026 rates, the two payrolls look like this.
| Singapore (CPF) | Vietnam (SHUI) | |
|---|---|---|
| Monthly salary | S$5,000 | VND 40,000,000 |
| Employee contributes | S$1,000 | VND 4,200,000 |
| Employer contributes | S$850 | VND 8,600,000 |
| Total contributions | S$1,850 | VND 12,800,000 |
| Employee takes home | S$4,000 | VND 35,800,000 |
| Employer’s total cost | S$5,850 | VND 48,600,000 |
This is why a simple percentage comparison misleads. Singapore’s 37% CPF is a combined employee-and-employer contribution into one system. Vietnam’s 25.5% social insurance figure is only one part of the broader mandatory insurance structure.
Actual payroll calculations can also vary with the employee’s status, salary composition and applicable contribution ceilings.
What About Retirement?
CPF Payouts vs Vietnam Pension
In Singapore, CPF savings accumulate during employment and are allocated between CPF accounts according to age and the applicable allocation rates. At age 55, a Retirement Account is created, and CPF savings can subsequently support retirement payouts through CPF LIFE. For members turning 55 in 2026, the Full Retirement Sum is S$220,400. CPF Board’s 2026 retirement figures provide the current amounts.
Vietnam’s social insurance system instead links pension entitlement to participation and contribution history under the Social Insurance Law. The 2024 law also changed several aspects of the pension and social insurance framework.
Examples include bringing foreign employees into compulsory social insurance from 1 July 2025 and tightening lump-sum withdrawal rules, so that workers who join the system from 1 July 2025 can generally only take a lump-sum withdrawal in limited cases, rather than after 12 months of contributions as before. Vietnam Social Security’s summary of the 2024 law outlines these changes.
In practice, the same contribution percentage creates different rights and benefits under each country’s system.
How Do CPF and SHUI Change if the Employee Is a Foreigner?
Which Foreign Employees Are Covered?
This becomes particularly important for Singapore businesses sending staff to Vietnam.
In Singapore, CPF contributions generally apply to Singapore citizens and Singapore permanent residents working under a contract of service. Foreign employees who are neither citizens nor permanent residents generally do not receive CPF contributions. Singapore’s Ministry of Manpower (MOM) sets out the applicable CPF coverage.
Vietnam takes a different approach. Foreign employees can fall within compulsory social insurance where they work for a Vietnamese employer under a definite-term labour contract of 12 months or more, subject to specified exclusions such as intra-company transferees and certain retirement-age cases. Vietnam Social Security’s current guidance confirms the current treatment.
For covered foreign employees, Vietnam Social Security (VSS) states that the employee contribution is generally 9.5%, comprising 8% for retirement and survivorship and 1.5% for health insurance. The employer generally contributes 20.5%, comprising 17.5% social insurance (including the 0.5% occupational accident and disease component) and 3% health insurance. VSS’s contribution guidance sets out these rates.
What Should Businesses Consider Beyond the Contribution Rate?
CPF and social insurance are only part of the employment cost calculation.
Singapore has no statutory minimum wage, although employment law sets requirements around matters such as salary payment, working hours and leave. Employees covered by the Employment Act are generally entitled to at least seven days of annual leave in their first year, increasing to 14 days with service.
MOM’s annual leave guidance sets out the statutory entitlement, while MOM’s salary rules require salary to be paid at least monthly and generally within seven days after the salary period.
Vietnam has its own separate employment and payroll framework, including regional minimum wages and rules governing employment contracts, leave, working time and statutory insurance. From 1 January 2026, Decree 293/2025 sets the current regional minimum wage levels. Central districts of Ho Chi Minh City, Hanoi and Da Nang are all in Region I, at VND 5.31 million per month (VND 25,500 per hour), and outlying districts of the major cities sometimes fall into Region II. The full 2026 scale is set out below.
| Region | Monthly minimum wage (from 1 Jan 2026) |
|---|---|
| Region I | VND 5.31 million (VND 25,500 per hour) |
| Region II | VND 4.73 million |
| Region III | VND 4.14 million |
| Region IV | VND 3.7 million |
For a Singapore business entering Vietnam, this means the payroll model should be built around the full employment structure rather than simply applying Singapore CPF percentages to a Vietnamese salary.
The broader context for why businesses consider Vietnam at all, including the investment relationship and the Vietnam-Singapore Industrial Park (VSIP) network, is covered in our post on why Singapore invests so much in Vietnam. Our GST versus VAT comparison makes a similar point about tax: two systems addressing similar functions through different rules.
Conclusion
CPF and Vietnam social insurance serve similar broad objectives, but they are not interchangeable systems.
For a Singapore business considering Vietnam, the important questions are not simply “Is Vietnam’s contribution rate lower?”
Instead, you should ask:
- What contributions apply to the employee?
- What benefits do those contributions provide?
- What salary components form the contribution base?
- Does the employee’s nationality or residency change the calculation?
- What additional health, unemployment and employment obligations apply?
- How will the rules affect the company’s payroll administration and total employment cost?
Understanding these points before hiring or transferring employees can make the difference between a payroll model that looks correct on paper and one that works correctly in practice.
For businesses setting up or expanding in Vietnam, check United Consulting’s guide to Vietnam tax compliance for SMEs for a practical look at expense settlement, value-added tax (VAT) and corporate income tax deductibility. Our posts on Vietnam hiring trends after Tet 2026 and Vietnam factory setup costs near HCMC also cover the wider employment-cost picture.
Considering Vietnam for a new business or expansion? Contact United Consulting to discuss accounting, tax, payroll and compliance requirements in Vietnam.
