How to Record Trade Union Fees by Payer and Contribution Rate

Vũ Khôi

Author at Wotech Electronics Blog

Trade union fees are a mandatory cost for every business and organization, with distinctive differences from other types of expenses. Accountants must therefore keep close track to record trade union fees accurately and avoid errors. In this article, SimERP shares with you the most accurate and time-saving way to record trade union fees.

What are trade union fees?

Trade union fees are the funding source for union finances, paid by businesses and used for the organizational activities of trade unions at all levels.

Who must pay trade union fees

Under Article 4 of Decree 191/2013/ND-CP, the entities required to pay trade union fees include:

• State agencies and units of the people's armed forces.

• Socio-political organizations and socio-political-professional organizations.

• Public and non-public public service units.

• Enterprises operating under the Enterprise Law and the Investment Law.

• Cooperatives established and operating under the Cooperative Law.

• International agencies and organizations, and foreign organizations operating in Vietnam that engage in trade union activities, as well as foreign executing offices of business contracts in Vietnam that employ Vietnamese workers.

• Other organizations that employ workers as prescribed by law.

Trade union fee rates

• The fee equals 2% of the payroll fund used as the basis for paying social insurance for employees.

• This payroll fund is the total wages of employees who are subject to mandatory social insurance under the law on social insurance.

• This trade union fee is paid by the business and is recorded as a production and business expense for the period.

How to pay trade union fees

Agencies, organizations, and businesses pay trade union fees monthly at the same time as mandatory social insurance contributions for employees. For payment procedures and documentation, the accountant can contact the District or Provincial Labor Federation where your business is registered for more details.

How to record trade union fees

How should trade union fees be recorded correctly? Let's continue below.

• For accounting, trade union fees are recorded in detail by department and charged to the business's expenses:

• Debit accounts: 154, 241, 622, 623, 727, 641, 642…

• Credit 3382: (2% of total wages subject to social insurance)

• When paying trade union fees:

• Debit account 3382. (2% of total wages subject to social insurance)

• Credit accounts 111, 112

Note: This is how to record the trade union fees payable to the District/Provincial Labor Federation.

If it is the union dues of employees within the business who join the grassroots trade union organization (dues equal to 1% of monthly wages subject to social insurance), the business does not record them in its accounting books but tracks them separately outside the books.

• If the company's grassroots union uses 65% of the total trade union fees collected, it is tracked through account 3388

• Other payables.

• Debit account 3382

• Credit account 3388

Applying technology to recording trade union fees

In the 4.0 technology era, applying supporting software to business management is increasingly necessary, especially for functions that demand highly accurate data such as accounting. However, because they have not fully grasped the outstanding benefits accounting software brings, many businesses still run their accounting departments using traditional methods, wasting time, resources, and money.

Here are the enormous benefits accounting software can bring:

Time savings

Using professional accounting software is the optimal solution for businesses, maximizing time savings. All software today includes automation features that replace previously manual operations.

With accounting software, leadership always has full accounting and financial information about the business, enabling fast, effective decision-making. Beyond that, the business can raise the productivity of its accounting department, thereby saving on personnel and other costs.

High accuracy

Accounting software provides calculation tools that are far more precise than traditional manual management and calculation methods. Software-based calculation minimizes computation errors to the greatest extent.

Using accounting software ensures data accuracy for goods, costs, and more. Moreover, accountants can easily and frequently cross-check and verify figures to catch errors arising during calculation and compilation.

Fast, easy consolidation and financial statement preparation

Accounting software can automatically retrieve reports, ledgers, and documents, sparing accountants many manual operations and much effort when preparing reports and books. Accounting software can consolidate, compile, and report against any requirement the business has, extremely quickly. Furthermore, the software automatically generates daily, weekly, or monthly reports.

Accounting software delivers enormous, undeniable benefits to businesses; however, as a business grows and its headcount increases, accounting software alone cannot meet all management needs. That is why many businesses choose an ERP resource planning solution as a long-term, sustainable direction for every business today.

SimERP — the enterprise resource planning solution

About SimERP

SimERP is an enterprise resource planning (ERP) software built and developed on Odoo — the world's most popular ERP software, with more than 16,000 applications, supporting over 2,500 partners, and serving more than 5 million users worldwide.

SimERP's solutions

SimERP consists of 9 intelligent modules integrated on a single platform:

• Project management module.

• Accounting management module.

• HR management module.

• Retail management module (POS).

• CRM management module.

• Sales management module.

• Warehouse management module.

• Purchasing management module.

• Manufacturing management module.

SimERP's outstanding advantages

– A Vietnam-standard accounting module: Complies with Circular 200 of the Ministry of Finance, making it easy to consolidate and build reports, and suitable for businesses of every size and type in Vietnam.

– Powerful permission control: SimERP assigns user permissions based on position, job, and role within the business.

– Flexible user counts: SimERP was created to provide a complete management solution suitable for every business in every field. From small, individual establishments to large enterprises, all can use it.

– Diverse deployment models: Businesses can weigh, choose, and deploy the model that suits them best:

• On-premise: deployed directly on the business's own servers with a dedicated IT engineering team to operate it.

• On-cloud: a model deployed on the cloud platform without customization.

• Hybrid: a combination of on-premise and on-cloud, aimed at comprehensive application development.

SimERP's notable customers

Despite being a newcomer, with its outstanding advantages and reasonable deployment costs, SimERP is now trusted by many domestic and international businesses, including: 24h VISA, Trung Nguyen Group, Bibomart, Flexfit Furniture, and more.

Getting to know SimERP's Accounting Module

Experts rate SimERP's Accounting Module as one of the optimal solutions for tracking, controlling, and managing a business's accounting, financial, and business situation.

Outstanding advantages

• Complies with international accounting standards, Circular 200 of the Ministry of Finance, and Vietnamese accounting regulations.

• Tight invoice control and accurate forecasting of future costs.

• Close tracking of revenue and the contracts corresponding to payments.

• Automatic configuration setup, perfectly matched to each business's accounting system.

• Tax accounting and internal accounting are managed on a single platform.

Key features

– Sales accounting management:

• Manage invoices per order from agents, suppliers, or customers.

• Track refund invoices at different stages.

• Manage payments, products, and customer information.

– Management accounting:

• Budget management.

• Revenue management.

• Manage general ledger entries and asset entries.

• Enter deferred revenue.

– Fast, accurate consolidation and report preparation:

• VAT declaration reports.

• Balance sheet, account balance report, general journal.

• Budget reports, margin reports.

• Asset and deferred revenue reports.

– Flexible customization:

• Set up charts of accounts, taxes, and currencies.

• Set up payment terms while tracking payments.

• Set up bank accounts and ledgers.

• Set up analytical account groups.

In closing

Above are the basic information and knowledge about recording trade union fees.

With 9 powerful modules, SimERP can fully handle financial and accounting operations under Circular 133/2016/TT-BTC and Circular 200/2014/TT-BTC. If you have any questions about recording trade union fees, leave a comment below this article and SimERP will answer you promptly!

Related articles