Contributions Payment

Contributions for SSO members may they mandatory or voluntary members, will have to be paid to the social security fund for each month until the 15th day of the month following the reported month.

The employers will have to transfer the contributions of both, employers and employees to the social security fund. The SSO will make the employer responsible to pay for the whole contribution amount, which includes employees’ and employer’s contribution. The total amount is 9.5% of the salary up to a monthly threshold of 1,500,000 Kip. The employer pays 5% and the employee 4.5% of this amount. It’s the employer’s duty to deduct the contributions to be paid by the employee from its salary. If the employer forgets to deduct the contributions to be beard by the employees from their salaries, he alone will then be made responsible to pay the total amount of contributions.

What are the sources of revenue of the social security fund?
The social security fund gets revenues from:

• The employers and employees contribution (9.5% of the salary)

• Interests gained from the fund investments

• Other incomes (subsidies by the Government and other parties, fines for late contributions, etc.)

Is the social security a single fund or composed of a number of sub-funds?
Social security fund is divided into 4 sub-funds, predominately for management reasons:

1. The Health care fund (for health insurance benefits)

2. The Short term benefits fund (for maternity birth, sickness and death benefits)

3. The Long term benefits fund (for retirement pension benefits, disability benefits and survivor's benefits)

4. The Workplace related benefits fund, earmarked for the employment injury and occupational diseases.

What are the main obligations of the employers concerning Social Security?

1. Registration:
   Employers first have to register with SSO. For employers with equal or more than 10 employees, the registration is mandatory. For small employers, SSO offers voluntary membership. Registration requires the submission of the forms (SSO 1-01) and (SSO 1-02).
   

2. Monthly reporting:
   The employer has to report to SSO the monthly salaries of the individual employees as well as potential changes of staff. New entries will have to be registered with SSO. For leaving employees, the last working day has to be mentioned.
   Concerned documents are the basis for contribution payment:

   • Contribution payment form SSO 2-01 (overall)

   • Contribution payment form SSO 2-02 (detailed)

   • Resignation letter of insured persons SSO 1-07

   • Insured person's employment declaration (for existing insured persons only) SSO 1-04

   • Replacement employment information request SSO 1-06

   
   If employers are using computer system for data record, they can transfer all contribution payment information of employers and employees electronically, based on the formats of contribution payment SSO 2-02. Please note: The SSO form 2-01 need always be submitted as hard file, as it requires to be stamped by a SSO officer.
   
   

3. Calculation of contribution and payment procedures:
   Calculation of each employee's contribution is based on the actual salary of each person for the reported month (with a contributable income ceiling of 1,500,000 Kip per employee). Social security contributions will have to be paid monthly, until the 15th of the following month latest. The employer is responsible to pay the whole amount, including the employees' contribution. Employers can pay their contribution either by bank transfer or by cheque to SSO.
   
   

4. Fees for delayed payment:
   Non- or deleted payments are subject to a monthly additional 2% fee of the contributions due.

5. Rules for bank transfers:
   Employers can make contribution payment to social security fund at one the following banks:

For bank transfers, the following procedures will have to be applied:

• 3 copies of SSO 2-01 and SSO 2-02 forms will have to be prepared. After getting bank's signature and stamp on SSO 2-01, the employer keeps one set as justifying document for his own accounting. The remaining 2 sets will have to be submitted to SSO.

• Out of the 3 copies of the payment order form, the original will remain with the employer as justification, the second will be kept by bank as reference and the third will have to be attached with the contribution payment form and submitted together to SSO.

• As key information on the payment order forms the enterprise code, the enterprise name and the month/period and year, for which the contribution is paid, have to be mentioned. The total amount of contribution payment must match with the amount mentioned in SSO 2-01 form.

Rules for cheque payments:

• Cheques are only accepted, if the payer’s bank or treasury is registered in Lao PDR.

• Cheques should be issued on the name of enterprise. However, cheques of individuals can also be accepted.

• Banks must not refuse the cheques, no erasures or dirty cheques are accepted.

• Cheques must be paid to "Social security organization" or "Social security fund";

• Cheques must be issued with date of payment not more than 10 days in advance, but always prior to the deadline for paying contributions.
  
  

How to fill the contribution payment form?

• Enterprises registered with SSO have to fill the following contribution payment forms (SSO 2-01 and SSO 2-02) [LINK TO FORM]. Note: The enterprise code will be issued and figures on the SSO registration certificate.

• The contribution payment form (SSO 2-02) has to be fully completed each time, and all employees have to be listed. If the enterprise has more employees, which will not all fit into one page, as many as necessary pages will have to be added. The accumulated sum of contribution payment reported in SSO 2-02 must be the same as the amount reported in form SSO 2-01. Finally, he employer must certify and stamp each page.

• The total contribution payment reported in the form SSO 2-01 must not differ from the amount transferred to SSO.

• Name and family name of the employees mentioned in SSO 2-02 must be the same name and family name of the employees' ID membership card. The employer has to verify the SSO code number of the insured person whenever any contribution payment is made in order to prevent later conflicts.