For several years now, there has been a huge influx of retirees who pack their bags, leave their home countries, and choose to settle in Vietnam. Why are they doing this? What attracts them so much to this Southeast Asian country? The answer is simply that this country has a lot to offer and is ideally positioned in Asia making traveling easy and inexpensive. The cost of living in Vietnam is very affordable. The climate is perfect. It is not too hot nor too cold. If you are thinking of spending your golden years in this beautiful country you should make sure that you are well-informed of all the paperwork you need as well as the costs. In this article, we will give you a complete view of what to expect when you retire in this paradise.
When we check online on some expat forums, we find different information regarding the Vietnam retirement visa for 2019. We found an article saying that it’s easy to get a retirement visa. The reality is that it isn’t ! If you want to retire in Vietnam in 2019, 2020 and the next years, we want to be clear : there are currently no way to apply to a retirement visa program. In this article, we will show you the way you can live in Vietnam for more than six months without having to move out of the country every three months. We will cover everything you need to know about the different kind of visas, give you an idea of the price, and pros and cons of each option so you will be able to consider the one that fit your need and budget.
Advantages and Disadvantages of Becoming a Pensioner and Living in Vietnam
Before we talk about all the things you need to know to move to Vietnam, it is best to know as much information as possible to avoid any surprises once you get there. Below we have listed down the advantages and disadvantages of moving to this country.
We will also discuss why it is a great idea especially if you are receiving a pension from a western country.
What are the Advantages of Moving to Vietnam?
If you choose to retire in Vietnam, you will receive a number of advantages:
- Very affordable cost of living: life is much cheaper in Vietnam and especially for people who receive retirement pensions from western countries. According to most expats, you can live comfortably in Vietnam with only 1000 euros per month. This is definitely less than what you would spend in your home country.
- The beautiful landscapes: this country is very diverse : from countryside landscape, paradise beaches to wild islands. You can find mountains and oceans within a couple of hours of traveling. Even when you live in big cities such as Hanoi and Ho Chi Minh, you can still expect to have patches of greenery and fresh air.
- The friendliness of locals: this country bears a particular charm especially because of the hospitality of the Vietnamese people. For them, everyone is a member of the family so you shouldn’t be surprised to get invited to eat at someone’s house despite not knowing them well.
- Culture: Vietnam has a very rich and diverse culture. The culture in the north and south of Vietnam are not exactly the same and discovering this will be a great pleasure.
What are the Disadvantages of Retiring in Vietnam ?
It is not always easy for one person to adapt to another culture and environment. So you must be 100% sure you are open to the idea when making your move so you will not have regrets or feel disappointment in the future. When listing disadvantages in this country, it is difficult not to speak about the language barrier, since it is one of the biggest struggles of expats. This means that you may need to put in a considerable amount of effort in order to integrate if you do not speak Vietnamese.
Although it is true that life is less expensive, it is still common for foreigners to be charged what is jokingly referred to as “the foreign price”. Aside from this, the country does not have a large number of modern infrastructures, but this is understandable since Vietnam is a developing country.
At the end of the day, the decision is completely up to you but you should be aware that according to those who made the move, the advantages clearly outweigh the disadvantages. Aside from advantages and disadvantages, there is other information you should keep in mind such as your tax situation — how much and how you must pay. This is extremely important in order to avoid any fines in the future.
Key Things You Must Do and Keep in Mind to Retire in Vietnam
If your mind is made up about traveling to this South-East Asia country and spending your retirement there, you must make some necessary steps before you leave your country. These requirements will allow you to completely enjoy your stay without complications. These include both health and administrative requirements.
- Vaccinations: for foreigners, Vietnam does not require any vaccinations to enter the country so it is not mandatory that you do it. But as a precaution, it is best to go to the Vietnamese embassy in your country to check what kind of vaccines they suggest for you since there are some high-risk regions. Although the Vietnamese government does not have requirements, your home country might. For example, World Health Organization (WHO), recommends a particular list of vaccinations such as diphtheria, chickenpox, tetanus, poliomyelitis, typhoid, hepatitis A, hepatitis B, meningitis A + C, and Japanese Encephalitis. A rabies vaccine is also recommended for rural areas.
- Carrying your luggage in Vietnam: If you are planning to move all of your belongings to Vietnam, it is best to send your luggage via a shipping company rather than taking it on your flight. It might take up to eight weeks for your parcel to arrive so sending it a few weeks before you leave your home country. To guarantee the safety and reliability of the services, the authorities advise using the services of professionals with an NF service or ISO 9002 certificate. You should also note that you may be asked to declare any shipment which will arrive after you upon its arrival.
- Health insurance in Vietnam: your goal is to spend your retirement days worry-free and filled with enjoyment so you must take the necessary precautions. Therefore, purchasing reliable health insurance should be at the top of your list. In fact, countries that have social security insurance for their citizens will only have them covered for up to three months. In order to avoid any unwanted medical expenses, you may purchase an insurance package from a private company. This is also available in Vietnam. You should also check the foreign policy of your government since some countries offer their citizens living abroad special insurance.
- Registration: This step may differ from country to country. Although you are not required to do this, it is still best to register in your embassy or consulate in order to get certain benefits. If you are not close to any consulate or embassy many countries actually have an online registration procedure. For example, Americans can register at the Smart Traveler Enrollment Program while Canadians may register via Registration for Canadians Abroad. You may check on your Foreign Affairs website for more details on your specific country.
Getting a visa in 2019: How to Live in Vietnam as Retiree ?
If you want to go halfway across the world and spend your retirement without fear of having incidents or having to face immigration officers, the visa is unavoidable. In this case, you must apply to the Vietnamese Embassy in your home country. Below are the requirements in order to secure your Visa:
- A valid legal passport;
- Visa application forms from the Vietnam Embassy;
- Recent identity photos in 4 x 6 cm format; and
- Visa fees
Short term visa : single and multi entry to Vietnam
The easiest way foreigners are living in Vietnam (including retired expat spending their time yearly there) is to deal with short term Visa (from 3 months to 6 months).
The process is usually as follows :
- Get in touch with a Visa agency that will provide you an invitation letter matching the date you would like to stay. Download your free copy of our book to know which Visa company we personnaly recommend to avoid scammers.
- Doing a Visa run (going out of the country) up to Cambodia, Laos or Thailand to renew your visa. The goal is to enter in the Vietnam territory at the specified date of your invitation letter.
- At the immigration office in the Airport, you will get a new Visa that will allows to stay in Vietnam by paying the stamp fee.
Using this process allowed you to extend your stay in Vietnam without any limits (be aware that there are now more restrictions). Many expat live in Vietnam for years using this option so it may be a good one to consider.
Permanent retirement visa in 2019 and 2020 through a company creation
In 2019, there is a way to get a permanent residency permit that allows foreigners to live in Vietnam from one to three years. The process is through the creation of a local Vietnamese company. Opening a company in Vietnam can be tricky and implies requirements if you want to be the business owner. The recommended option would be to involve a friend who is Vietnamese and can simplify the paperwork to create and maintain the entity.
Having a running company in Vietnam will allows you :
- Open a business (hotel, restaurant, guesthouse …) if you want to contribute to the society and spend time during your retirement in Vietnam.
- Obtain a permanent residency permit that you can use as a permanent replacement of the usual visa. Once gained, you won’t need to leave the country every 3 to 6 months and will be able to stay up to 3 years.
Taxes in Vietnam
According to your situation (nationality, residency, income source), different schema will be applied. We will provide you further general information that you will need to double check to see how to implement them.
Vietnam and France have signed a bilateral agreement which lets French expatriates pay taxes only when they become residents in Vietnam. This means that French nationals who live in Vietnam will still face taxes, but the tax scheme you will follow will be the same as if you are living in France. Here is the scheme used with the rates in thousands of dongs:
Taxable income per year (VND) Tax rate :
- Up to 8,000 per month: 0%
- From 8,000 to 20,000 per month: 10%
- From 20,000 to 50,000 per month: 20%
- From 50,000 to 80,000 per month: 30%
- Beyond 80 000 per month: 40%
It is your responsibility to identify your income. Be aware that despite your status as a resident of Vietnam, there is always income that is taxed in your home country. This generally concerns real estate income and capital gains on the sale of real estate (including SCI), attendance fees, retirement benefits for civil servants, etc. Therefore it will be necessary to make a declaration at the level of the non-resident center, even if you already paid as a resident in Vietnam.
Private sector pensions are considered non-taxable, so you will not be taxed in Vietnam if you become a Vietnamese resident. Explore this subject further on our deep study dedicated to taxes in Vietnam. As a general rule: public sector pensions remain taxed in your home country and private sector pensions in Vietnam. As Vietnam considers these pensions tax-free, then it will be wise to become a Vietnamese tax resident.
For Other Nationalities
Taxable Income per year (VND) Tax rate:
- Up to 60,000,000: 5%
- From 60,000,000 to 120,000,000: 10%
- From 120,000,000 to 216,000,000: 15%
- From 216,000,000 to 384,000,000: 20%
- From 384,000,000 to 624,000,000: 25%
- From 624,000,000 to 960,000,000: 30%
- Above 960,000,000: 35%
Note that if you are a non-resident you will be taxed a flat rate of 20%
Of course, we are not tax experts so it is best to consult an accountant or a taxation lawyer for your specific case.
Retiring in Vietnam: How to Benefit from your Retirement by Living in Vietnam
Vietnam is the place to retire. In most Western countries, the pension given to retirees is usually not enough to maintain a great standard of living. Apart from the fact that Vietnam has a cheaper cost of living, this country is a very rich platform of opportunities, with a market of 89 million inhabitants. It is a haven for entrepreneurs, so it attracts many expatriates. If you want to still be occupied in your old age, you will be able to maintain an active social and professional life. We advise retired in Vietnam to keep their bank accounts in their home countries in order to receive their retirement pension. They will then be able to open a local bank account in Vietnam to minimize withdrawal fees at ATMs.
For French Citizens
To be able to benefit from your retirement pension while being outside the French territory, certain conditions must be met. Above all, your retirement destination must have a bilateral social security agreement with France. When this is not the case, things are a bit more complex. Vietnam has unfortunately not signed such an agreement with France. Even with this, retiring in Vietnam is still uncomplicated and feasible. Our article features tips, information, and steps to take to enjoy your retirement in comfort in Vietnam.
We will approach the issue on a case by case basis:
Countries Without Bilateral Convention
When the country has no bilateral agreement with France, pensions are treated independently of each other. The periods of work performed in different countries cannot be cumulated. In these circumstances, particular attention should be paid to the requirements that host countries will form in order to regain possession of their pension. For example, you may be asked to justify that you are a resident of their country. It is in these conditions that the subscription to voluntary insurance at the level of the Caisse des Français de l’Etranger is very important. You may confirm this information but right now, Vietnam has a bilateral convention with France so as a French person living in Vietnam you will enter in a proper schema that will save you headache.
The Caisse des Français de l’Etranger (CFE)
The CFE is a state structure under the control of two ministries namely: the Ministry of Employment and Solidarity and the Ministry of Economy, Finance and Industry. The CFE is in charge of the treatment of expatriate social security, regardless of whether they are employees or not. Regardless of the contributions, you may have to pay in the country you moved to. It is possible to have a complete basic pension. All you have to do is make a contribution to the CFE. Thus, if you have a job abroad and you have French nationality, you have the option of joining the CFE on your own or using your company. In addition, the calculation of contributions at the level of the CFE is based on the scales of social security.
Repurchase of pension contributions
You can opt for a purchase of your periods of activity abroad at the level of the “Caisse Nationales de Vieillesse”. You will then have the chance to enjoy a complete basic retirement. To achieve this, certain processes must be initiated. You must go to the Caisses Régionales d’Assurance Maladie (CRAM) closest to you in France. If however, your residence is outside the country, you are free to choose a CRAM that suits you.
For American Citizens
Similar to France, The USA also has social security and pension scheme for their citizens who have worked and retired abroad. This is called the Totalization Agreement and this is between the USA and 26 other countries. This agreement ensures that workers would not be taxed by both of the countries and that any social security contribution would be totaled between the two countries. Unfortunately, Vietnam is not one of the 26 countries with this agreement. This means that you should check with legal professionals or with an accountant to make sure that you will receive the right pension and that you have enough contributions in at least one of the countries.
As for those who have worked in the USA all their lives and are just looking into retiring abroad, you should not be worried. You will receive your pension as long as you are eligible (you have enough contributions, etc.) regardless of where you choose to retire.
For Canadian Citizens
Retired Canadians may receive pension either from the Canadian Pension Plan or the Old Age System. Pension from these two institutions is issued through checks. Once you have moved to Vietnam (or any other country) you must immediately send a notice for a change of address since checks are mailed to you monthly. The currency of your pension will usually depend on the country where you are residing at the moment.
For Other Nationalities
Receiving your pension while living abroad should not be an issue in most countries. However, it is best if you check with the appropriate offices first to see any special rules or extra procedures you must take.
Conclusion : How to Retire in Vietnam
We hope that this article was able to help you in deciding whether Vietnam is the perfect place for your retirement. According to many pensioners and expats, it definitely is an amazing place. But keep in mind that it is best if you check off all the steps and administrative requirements we mentioned in order for you to have zero headaches and just have fun times in Vietnam.