Accounting for social insurance contributions for non-salaried directors is a matter of concern for many businesses and accountants when applying new regulations on mandatory social insurance participation. Social Insurance Law 2024Business directors, belonging to the group of business managers, may incur social insurance contribution obligations when meeting the conditions stipulated by regulations. This article will help businesses understand how to account for social insurance for non-salaried directors, the accounting accounts to use, the social insurance contribution rates, and important considerations. Circular 99/2025/TT-BTC To minimize errors during the implementation process.
Are business directors subject to mandatory social insurance contributions?
Yes. According to point i, clause 1, Article 2 of the 2024 Social Insurance Law, the following subjects are subject to mandatory social insurance participation:
Business managers, controllers, representatives of state capital, representatives of enterprise capital as prescribed by law; members of the Board of Directors, General Director, Director, members of the Supervisory Board or controllers and other elected management positions of cooperatives and cooperative unions as prescribed by the Law on Cooperatives are entitled to salaries.
However, this regulation applies only to cases where the aforementioned individuals receive a salary.
Therefore, not every business director is automatically subject to mandatory social insurance. Businesses need to base their decisions on the actual situation, such as:
- Whether or not a salary will be paid will be decided.
- Is there any salary earned that can be used as the basis for social insurance contributions?
- Do they belong to the group of business managers as defined by regulations?
This is an important basis for accountants to correctly determine the obligations and account for social insurance contributions for non-salaried directors in a business.
Do directors who do not receive a salary have to pay social insurance contributions?
The situation where a director does not receive a salary is quite common in many businesses, especially small companies or those directly owned and managed by the owner.
According to the Social Insurance Law 2024, business directors are considered business managers and are required to participate in mandatory social insurance when they receive a salary.
Therefore:
- If the director does not receive a salary and is not subject to mandatory social insurance contributions, then the business does not have an obligation to pay social insurance contributions for the director.
- If the director receives a salary based on an internal decision, contract, or management record, the company must pay social insurance contributions as required by law.
Accountants need to thoroughly check all relevant documents before recording social insurance expenses, avoiding situations where the obligation has not actually arisen.
How much social insurance does a company pay for its director?
According to Clause 1, Article 34 of the 2024 Social Insurance Law, employers must pay mandatory social insurance contributions monthly based on the director's salary (as specified in Point i, Clause 1, Article 2) at two rates:
| Insurance fund | Business closure rate |
| Sickness and Maternity Fund | 3% |
| Pension and death fund | 14% |
| Total contribution of the enterprise | 17% |
In addition to the company's contribution, the director (the employee) also contributes their share according to the rate stipulated in Article 33 of the 2024 Social Insurance Law (8% to the retirement and death benefit fund), which is deducted directly from their salary.
For example: If the director's salary used as the basis for social insurance contributions is 10,000,000 VND/month, then the amount the company has to pay is: 10,000,000 x 17% = 1,700,000 VND.
The accountant records this amount through account 3383 (Social Insurance).
Example of accounting for social insurance for the director in a business.
Suppose:
- The company director receives a salary;
- Salary used as the basis for social insurance contributions: 20,000,000 VND/month;
- Businesses are responsible for paying social insurance contributions (17%).
To understand the accounting method clearly, please refer to the table below with MAN – Master Accountant Network:
| Accounting time | Business content | Accounting entries | Amount |
| When deducting social insurance contributions, businesses must pay them. | Record the social insurance expenses incurred for the director who is subject to mandatory social insurance participation. | Debit related expenses account: 3,400,000 VND
Account 3383 (Social Insurance): 3,400,000 VND |
3,400,000 VND |
| When businesses pay social insurance contributions to the insurance agency. | Payment of deducted social insurance contributions, reducing the liability payable on account 3383. | Debit Account 3383: 3,400,000 VND
Account 111/112 has: 3,400,000 VND |
3,400,000 VND |
From the table above, it can be seen that the accounting for social insurance contributions for salaried directors is carried out in two main steps: recording the social insurance contribution payable and settling the social insurance obligation with the insurance agency. Tracking through account 3383 helps businesses accurately manage the amount payable, while ensuring accounting data complies with current regulations.
Note: In addition to social insurance, businesses also need to account for health insurance (Account 3384) and unemployment insurance (Account 3386) similarly, if the director is eligible to participate in these types of insurance. This is a part that needs to be fully implemented. Accounting for social insurance and payroll deductions. For all personnel.
Are social insurance contributions for the director deductible when calculating corporate income tax?
This is a point of confusion for many businesses. According to Clause 2, Article 9 of the Corporate Income Tax Law 2025, non-deductible expenses include the portion exceeding the prescribed limits for:
- This only provides direct welfare benefits to employees.
- Supplementary retirement insurance contributions, voluntary retirement insurance purchases, and life insurance for employees.
Principles of application:
| Case | Corporate income tax deductible |
| Pay mandatory social insurance contributions at the prescribed rate (17%) for salaried directors. | Yes, if the conditions in Clause 1 of Article 9 are met. |
| The portion of expenditure exceeding the government-regulated welfare benefits. | No deductions allowed. |
| Expenses without valid invoices or supporting documents. | No deductions allowed. |
Notes on accounting for social insurance for directors
To minimize errors in the accounting process, businesses should take note of the following:
- Review the director appointment decision and related documents.
- Determine whether the director is entitled to a salary.
- Social insurance expenses will not be automatically recorded if the payment obligation has not yet arisen.
- Keep separate records for account 3383 to manage the amount of social insurance contributions due.
- Keep all relevant documents related to the calculation and payment of social insurance contributions.
Accurately identifying eligible participants in social insurance not only helps businesses comply with legal regulations but also reduces risks during inspections by regulatory agencies.
When should you hire accounting services?
For small and medium-sized enterprises (SMEs) that have not yet established an internal accounting system, simultaneously complying with the 2024 Social Insurance Law, Circular 99/2025/TT-BTC, and the 2025 Corporate Income Tax Law is a major challenge. Even a slight discrepancy in contribution rates or accounting entries can lead to tax arrears or administrative penalties.
Use full accounting service or hire accounting services This is a solution that helps businesses:
- Properly record each transaction that occurs, including social insurance for the director.
- Stay up-to-date when policies change without having to do your own research.
- Minimize legal risks in year-end tax settlements.
Conclude
The accounting for the director's social insurance contributions should be determined based on the conditions for mandatory social insurance participation under the 2024 Social Insurance Law, especially whether the director receives a salary or not.
If the director is subject to social insurance contributions, the enterprise shall record the arising amount through account 3383 (Social Insurance) as guided by Circular 99/2025/TT-BTC, while ensuring that the records and documents are complete to serve accounting and tax settlement purposes.
Staying up-to-date with the latest regulations helps businesses minimize the risk of errors in accounting, social insurance declarations, and expense management.
Contact MAN – Master Accountant Network For free support and advice!
Contact information MAN – Master Accountant Network
- Address: No. 19A, Street 43, Tan Thuan Ward, Ho Chi Minh City
- Mobile/Zalo: 0903 963 163 – 0903 428 622
- E-mail: man@man.net.vn
- Google Business Profile: View MAN – Master Accountant Network's Google Business Profile
- LinkedIn Founder: View expert Le Hoang Tuyen's LinkedIn profile.
Responsible for production and professional content review by: Mr. Le Hoang Tuyen – Founder & CEO of MAN – Master Accountant NetworkHe is a CPA Vietnam auditor with over 30 years of in-depth experience in accounting, auditing, taxation, and corporate legal consulting.
Frequently Asked Questions about Social Insurance Accounting for Directors
Not all directors are required to pay social insurance contributions. According to the 2024 Social Insurance Law, directors belong to the group of business managers who are required to participate in mandatory social insurance when they receive a salary as prescribed.
Businesses are required to pay mandatory social insurance contributions for directors who are eligible to participate, at a rate of 17% based on the salary used as the basis for social insurance contributions, including 3% for the sickness and maternity fund and 14% for the retirement and death benefit fund.
In cases where the director participates in the management and operation of the business, and the social insurance contributions arising are related to management activities, the business may consider recording them as business management expenses according to applicable accounting policies. However, the recording must be based on the nature of the expense, supporting documentation, and current accounting regulations. Does a company director who doesn't receive a salary have to pay social insurance contributions?
How much social insurance does the company pay for the director?
Is it permissible to include the director's social insurance expenses in the company's administrative expenses?
