EXPLANATION OF THE DISCREPANCY BETWEEN SOCIAL INSURANCE AND PERSONAL INCOME TAX SETTLEMENT DATA

1. Based on the request from the Social Insurance Agency, the company should identify: How many employees are there in the discrepancy list? Why do these employees have discrepancies (usually, at the end of each year, you should pay attention to key issues for easy explanation to the relevant authorities later)?

2. Review the document requirements from the Social Insurance Agency. What documents are needed? How long is the time for explanation? (If HR is unable to prepare the documents on time, proactively submit a request for an extension with the Social Insurance Agency).

3. The company should make detailed notes explaining the reasons for the discrepancies in item 1 to bring with them when explaining the discrepancies to the Social Insurance Agency.

4. Prepare the documents according to the requirements from the Social Insurance Agency. Typically, the Social Insurance Agency will request the following documents:

• The company's salary table.

• Documents for employees with discrepancies: Labor contracts, personal records, Citizen ID cards, work volume completion records (for contract work, temporary contracts, etc.), contract termination minutes, etc.

• Attendance sheets.

• Payroll sheets.

• Wage and payment vouchers.

5. Pay the outstanding Social Insurance (SI), Health Insurance (HI), and Unemployment Insurance (UI) contributions in full.

6. After preparing the 5 items above, start explaining the discrepancies to the Social Insurance Agency. Common causes for discrepancies may include the following:

• Employees on probation who do not meet the work standards after the probation period: This case will include the probation contract, Citizen ID, post-probation evaluation forms, attendance sheets, payroll sheets, and payment vouchers for probation wages or allowances (if any).

• Employees over the retirement age: Labor contract, Citizen ID, attendance sheets, payroll sheets, and payment vouchers for wages.

• Employees who leave the job for 14 days or more in the month: Note that this applies to leaving the job for 14 days or more, not for working less than 14 days. Many Social Insurance agencies may raise issues and reclaim for this: Labor contract, Citizen ID, attendance sheets, payroll sheets, and payment vouchers for wages.

• Employees with a piecework contract: Piecework contract, Citizen ID, volume completion record, contract termination minutes, payment vouchers, and team lists (if applicable).

• Employees who have paid SI, HI, and UI in another location: If complete documents are provided for explanation and the contributions have been paid in full, the Social Insurance Agency will have no further objections. Both parties will finalize the inspection minutes and sign the confirmation.