How to Calculate Personal Income Tax 2026 in Vietnam

how-to-calculate-personal-income-tax-2026-vinatpt

Vietnam’s Personal Income Tax 2026 law was amended Law No. 109/2025/QH15 and officially takes effect from July 1, 2026. Key rules for salary, wages, and business income, however, apply right from January 1, 2026. These updates significantly reduce the tax burden for employees and business owners amid rising living costs. 

This guide explains exactly how to calculate PIT in 2026, highlights the major changes (increased family deductions, simplified progressive rates, expanded exemptions), and provides clear, real-world examples so you can compute your tax accurately and stay fully compliant. 

1. Major Changes to Personal Income Tax from 2026 

2026 introduces the biggest PIT reforms since 2012, driven by the amended PIT Law 2025 and Resolution 110/2025/UBTVQH15. The goal is to ease pressure on middle-income earners, support digital businesses, and attract high-tech investment while keeping pace with economic growth and inflation. 

Change  Main Benefit 
Increased family deductions  Lower tax for individuals and families 
Simplified progressive brackets  Easier calculation, reduced tax for average incomes 
Expanded exemptions  Support for high-tech, agriculture, and green sectors 

These reforms make the tax system more modern, transparent, and easier to comply with. 

1.1 Increased Family Deductions Effective January 1, 2026 

From January 1, 2026, family circumstance deductions are raised to better match higher living costs, helping millions of taxpayers pay less personal income tax The personal deduction increases from VND 11 million to VND 15.5 million per month (VND 186 million per year), and the deduction per dependent rises from VND 4.4 million to VND 6.2 million per month. 

Type of Deduction  2025 Amount  2026 Amount 
Personal deduction  11 million/month  15.5 million/month 
Per dependent  4.4 million/month  6.2 million/month 

Who qualifies as a dependent? 

  • Children: Under 18; over 18 if disabled and unable to work; full-time students (university, college, vocational) under 22 with low or no income. 
  • Spouse: Unable to work or with very low/no income. 
  • Parents, grandparents, siblings: Elderly or disabled individuals with insufficient income, directly supported by the taxpayer. 

Key conditions 

  • Each dependent can be claimed by only one taxpayer. 
  • Proof is required (birth certificate, household registration, disability certificate, school enrollment, support commitment letter). 
  • Register with your employer or tax office (usually via Form 20-ĐK-TNCN) before tax is calculated. 

1.2 New Progressive Personal Income Tax 2026 Rates – Reduced from 7 to 5 Brackets 

Effective January 1, 2026, the progressive tax scale is simplified from 7 brackets to 5, with wider income ranges to reduce the effective tax rate for middle earners. The top rate remains 35%, now applying only to monthly taxable income over VND 100 million (previously VND 80 million). 

Bracket  Monthly Taxable Income (VND million)  Annual Taxable Income (VND million)  Tax Rate (%) 
1  Up to 10  Up to 120  5 
2  Over 10 to 30  Over 120 to 360  10 
3  Over 30 to 50  Over 360 to 600  20 
4  Over 50 to 100  Over 600 to 1,200  30 
5  Over 100  Over 1,200  35 

Old vs. new comparison The old 7-bracket system had narrower bands, pushing many middle-income earners into higher rates. The new structure is simpler and saves 5–15% in tax for most employees, while encouraging extra work without jumping brackets quickly. 

1.3 Expanded Exemptions, Reductions & Special Incentives 

The updated law adds 21 new exempt income categories starting in 2026, focusing on education, healthcare, green projects, and high-tech sectors. Additional benefits include a 50% reduction on certain investment income and a 5-year exemption for high-tech professionals. 

  • New exempt items: Certain overtime pay, scholarships, income from green bonds, organic agriculture, gifts under VND 10 million, disaster relief support. 
  • Special incentives: 5-year PIT exemption for experts in AI, semiconductors, and R&D; 50% reduction on income from investments in tech startups. 
Incentive Type  Condition  Duration 
Scholarship exemption  Full-time formal education  Indefinite 
5-year high-tech exemption  Experts in AI, semiconductors, R&D  5 years from 2026 
50% investment reduction  Green/technology startups  Applies to 2026+ income 

Proof (contracts, certificates) is required, often from the Ministry of Science and Technology. 

personal-incom-tax-2026-vina-tpt

2. How to Calculate Personal Income Tax in 2026 – Step-by-Step Guide 

Core formula Tax payable = Taxable income × Progressive tax rate Taxable income = Total income – Exempt items – Deductions (family + mandatory insurance + charity + eligible medical/education expenses) 

This applies to tax residents. Non-residents pay a flat 20% on Vietnam-sourced income. 

Step 1: Determine Your Tax Residency Status 

Start by confirming whether you are a tax resident or non-resident, as this determines what income is taxable. 

Under Vietnam’s PIT law: 

  • Tax resident: Present in Vietnam ≥183 days in the calendar year, or maintaining a permanent residence (owned home or long-term rental with registered address). 
  • Non-resident: Taxed only on income sourced from Vietnam. 

Tax implications 

  • Residents: Taxed on worldwide income using the 5-bracket progressive scale (5%–35%). 
  • Non-residents: Flat 20% on Vietnam-sourced salary and wages (other rates apply to specific types). 

Step 2: Calculate Taxable Income 

Basic formula: Taxable income = Total income – Exempt items – Deductions 

  1. Total income includes salary, bonuses, taxable allowances, business profits, investment returns, etc. 
  2. Exempt items include scholarships, certain overtime pay, small gifts, etc. 
  3. Deductions include: 
  • Family deduction (VND 15.5 million/month personal + VND 6.2 million/month per dependent) 
  • Mandatory social, health, unemployment insurance (BHXH, BHYT, BHTN) 
  • Charitable donations (with receipts) 
  • Medical & education expenses (new in 2026, up to VND 10 million/year – detailed guidance pending) 

Example In January 2026, Mr. A receives: 

  • Salary: VND 70,000,000 
  • Meal allowance (per company policy): VND 1,000,000 
  • Sales commission: VND 2,000,000 

No charitable contributions. Mr. A has one registered dependent (child under 18). 

Calculation: 

  • Total income: 70,000,000 + 1,000,000 + 2,000,000 = VND 73,000,000
  • Exempt: VND 1,000,000 (meal allowance) 
  • Deductions: 15,500,000 (personal) + 6,200,000 (dependent) + 4,200,000 (mandatory insurance) = VND 24,850,000
  • Taxable income = 73,000,000  – 1,000,000 – 24,850,000 = VND 47,150,000 per month 

Step 3: Apply the 2026 Progressive Rates

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Apply the 5-bracket scale to taxable income, calculating tax portion by portion and adding them up. 

Continuing Mr. A’s example (monthly taxable income: VND 47,150,000): 

  • Bracket 1: VND 10,000,000 × 5% = VND 500,000 
  • Bracket 2: (30,000,000 – 10,000,000) × 10% = VND 2,000,000 
  • Bracket 3: (47,150,000 – 30,000,000) × 20% = VND 3,430,000 

Total PIT payable: 500,000 + 2,000,000 + 3,430,000 = VND 5,930,000 

Net take-home pay: 73M – 4.2M (insurance) – 5.93M (PIT) = VND 62,870,000 

3. Special Rules for Foreigners and Expatriates in Vietnam 

Foreign nationals (expats) and overseas workers follow specific PIT rules in 2026. 

  • Non-residents: Flat 20% on Vietnam-sourced income, withheld at source. 
  • Residents: Subject to the same progressive rates as Vietnamese citizens. 

Double Taxation Agreements (DTAs) Vietnam has over 80 DTAs (with the US, EU countries, Japan, Singapore, etc.). To claim relief: 

  • Submit Form NT5/TNCN 
  • Provide proof of tax residency in your home country 
  • Claim credit for taxes already paid abroad 

Example: A non-resident expat earning VND 50 million/month pays VND 10 million (20%) PIT. With a DTA, the rate may drop to 10–15%. 

These rules, plus the 5-year exemption for high-tech experts, make Vietnam attractive for skilled international professionals. 

4. Filing and Finalizing Personal Income Tax in Vietnam 

PIT filing and finalization are fully online via the General Department of Taxation portal (thuedientu.gdt.gov.vn) or eTax Mobile app. 

General deadlines (apply every year): 

  • Employer finalization (for authorized employees): By the last day of the 3rd month after year-end (usually March 31). 
  • Individual self-finalization: By the last day of the 4th month after year-end (usually April 30). → If the deadline falls on a holiday or weekend, it shifts to the next working day. 

Who must self-file? Individuals with income from two or more sources who do not meet authorization conditions, or those seeking refunds or adjustments. 

5. Vina TPT – Your 2026 PIT Solution for Expats & Businesses in Vietnam 

Vina TPT is a leading tax advisory firm in Vietnam specializing in Personal Income Tax services for expatriates and foreign-invested companies. Our experienced team provides full support, from 2026 PIT forecasting and calculation to DTA claims and maximum deduction optimization. 

Why choose Vina TPT? 

  • Free initial consultation with clear guidance 
  • Fast, accurate filing and deadline reminders 
  • Full compliance with 2026 regulations to minimize risks 

Key services 

  • PIT finalization for expats with multi-source income 
  • Assistance with high-tech and investment incentives 
  • HR training on payroll updates and withholding 

Need help with your 2026 Personal Income Tax in Vietnam? Contact Vina TPT today for expert, hassle-free support.

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[Newsletter] Vietnam Tax Policy Updates September 2025- CIT, VAT, PIT and Social Insurance

Updates on new regulations regarding tax, e-invoices, and social insurance September 2025 (2)
Updates on new regulations regarding tax, e-invoices, and social insurance September 2025 (2)
As part of the Vietnam tax policy updates 2025, several new regulations related to Corporate Income Tax (CIT), Value Added Tax (VAT), Personal Income Tax (PIT), and social insurance are scheduled to take effect starting from September 2025. These changes are expected to directly impact financial reporting, payroll processes, and compliance operations across both Vietnamese and FDI enterprises.
To help businesses stay compliant and proactively adjust their internal procedures, this article provides a clear breakdown of the most important regulatory updates you need to be aware of.
In this article, we break down the most important tax regulations businesses need to prepare for in 2025.

1. Value-Added-Tax & IMPORT TAXES

1.a. Products manufactured from fabricated metals are entitled to a 2% value-added tax reduction.

Official Letter No. 6099/TCS3-QLDN2 dated September 11, 2025 of Dong Nai Tax Department regarding the case where a company manufactures and processes metal products, in which the determination of VAT reduction on sold products is made in accordance with Circular No. 174/2025/TT-BTC, specifically as follows:
  • The company shall identify its products based on the product codes, names, and descriptions provided in the Appendix issued together with Decision No. 43/2018/QD-TTg, and compare them with the List of goods and services not eligible for value-added tax (VAT) reduction issued together with Circular No. 174/2025/TT-BTC. In cases where the products fall under the List of goods attached to Circular No. 174/2025/TT-BTC, they shall not be entitled to VAT reduction.
  • For products manufactured from fabricated metals classified under Section 25, which are not included in the List of goods and services issued together with Circular No. 174/2025/TT-BTC, a VAT reduction shall apply.

1.b. Principles for making supplementary declarations of input VAT errors or omissions applicable from July 1, 2025.

Official Letter No. 3915/CT-CS dated September 18, 2025 of the Tax Department regarding VAT policies, specifically as follows:
  • The Tax Department stated that, from July 1, 2025, the Law on Value-Added Tax No. 48/2024/QH15 and Decree No. 181/2025/ND-CP have specifically provided regulations on the declaration and deduction of input VAT in cases of errors or omissions. Enterprises are therefore requested to study and comply with these provisions. Accordingly, under Point đ, Clause 1, Article 14 of Law No. 48/2024/QH15 and Clauses 5 and 6, Article 23 of Decree No. 181/2025/ND-CP, when errors or omissions in input VAT are detected, business establishments shall make supplementary declarations in accordance with the following principles:
  • A supplementary declaration shall be made in the month or quarter in which the error or omission in input VAT arises, if such error or omission results in an increase in tax payable or a reduction in refundable tax for that month or quarter.
  • A supplementary declaration shall be made in the month or quarter when the error or omission is detected, if such error or omission results in a decrease in tax payable, or only increases or decreases the amount of VAT to be carried forward to the subsequent period.

1.c. On-the-spot imported goods shall not be exempt from import duty and value-added tax.

Official Letter No. 22303/CHQ-GSQL dated September 5, 2025 of the Customs Department regarding on-the-spot imported goods, specifically as follows:
  • Clause 3 Article 3 of Law No. 90/2025/QH15 supplements Article 47a of the Customs Law, stipulating that on-the-spot import and export goods are goods delivered and received in Viet Nam under the designation of a foreign trader pursuant to sale, processing, leasing, or borrowing contracts. Cases that meet these conditions shall carry out customs procedures under Article 35 of Circular No. 08/2015/TT-BTC (as amended by Circular No. 167/2025/TT-BTC) and Article 86 of Circular No. 38/2015/TT-BTC (as amended by Circular No. 39/2018/TT-BTC).
  • According to Circular No. 134/2016/TT-BTC (as amended by Circular No. 18/2021/TT-BTC), in cases where on-the-spot imports are not registered under the processing type, the importer must declare and pay import duty based on the applicable duty rate and customs value at the time of registration. If import duty has been paid for production or business purposes and the imported products have been actually exported abroad or to a non-tariff zone, the paid duty shall be refunded in accordance with Article 36 of this Circular
  • On-the-spot import and export goods remain subject to VAT. Where goods are registered under other types (not processing), the taxpayer shall use code A11 (commercial import) or A12 (import for production and business) to declare and pay import duty and VAT.

2. Personal Income Tax (PIT)

2a. Some notes on PIT withholding and accounting for business trip allowance.

Official Letter No. 2284/CTH-QLDN1 dated September 15, 2025 of the Can Tho City Tax Department regarding taxable personal income (PIT) on business trip allowances, specifically as follows:
  • Taxable PIT income with respect to lump-sum business trip allowances: This is the portion of business trip allowances exceeding the limits prescribed by the State. Specifically: For employees working in business organizations and representative offices, the limit on business trip allowances shall be applied consistently with the level determined for corporate income tax (CIT) purposes. For employees working in international organizations or representative offices of foreign organizations, the limit on business trip allowances shall be applied in accordance with the regulations of such international organizations or representative offices of foreign organizations (see Point đ.4, Clause 2, Article 2 of Circular No. 111/2013/TT-BTC).
Travel expenses and accommodation costs for employees on business trips shall be deductible if supported by sufficient invoices and documents.
  • Where the enterprise has a financial/internal regulation stipulating allowances for travel, accommodation, and per diem for employees on business trips, and such regulation is properly implemented, these expenses shall be deductible.
  • Payment by employees’ personal bank cards for business trip expenses of VND 20 million or more (including airfares):
  • Such expenses shall be deductible if the following conditions are met:
  • Valid invoices and supporting documents are available.
  • A decision or written authorization for the employee’s business trip is issued.
  • The enterprise’s financial/internal regulation permits employees to pay using personal bank cards, with subsequent reimbursement by the enterprise.
  • Purchase of air tickets via e-commerce websites: The documents serving as the basis for deductibility include the electronic air ticket, boarding pass, and the enterprise’s non-cash payment vouchers showing the individual undertaking the transportation service.

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2b. Three Additional Types of Income Exempt from Personal Income Tax Effective from October 1, 2025

According to the new provisions in the Law on Science, Technology and Innovation 2025 (No. 93/2025/QH15), effective from October 1, 2025, Clause 3, Article 71 of this Law supplements Points 18, 19, and 20 after Point 17 of Article 4 on tax-exempt income under the Law on Personal Income Tax 2007, as amended and supplemented.
Accordingly, from October 1, 2025, three additional types of income will be exempt from Personal Income Tax (PIT), including:
  • Income from salaries and wages received from performing science, technology, and innovation tasks.
  • Income from copyright related to science, technology, and innovation tasks when the results of such tasks are commercialized in accordance with the laws on science, technology, innovation, and intellectual property.
  • Income of individual investors and experts working for start-up innovation projects, founders of start-up enterprises, and individual investors contributing capital to venture capital funds.

3. Corporate Income Tax (CIT)

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3a. New Regulations on Corporate Income Tax Rates effective from October 1, 2025.

On June 14, 2025, the National Assembly passed the Law on Corporate Income Tax 2025, effective from October 1, 2025. According to Article 10 of the Law on Corporate Income Tax 2025, the applicable corporate income tax (CIT) rates are as follows:
  • The standard CIT rate is 20%, except for the cases specified in (2), (3), and (4) below, and entities eligible for preferential rates under Article 13 of the Law on Corporate Income Tax 2025.
  • A 15% CIT rate applies to enterprises with annual total revenue not exceeding VND 3 billion.
  • A 17% CIT rate applies to enterprises with annual total revenue of over VND 3 billion up to VND 50 billion standard CIT rate is 20%, except for the cases specified in (2), (3), and (4) below, and entities eligible for preferential rates under Article 13 of the Law on Corporate Income Tax 2025
The revenue serving as the basis for determining whether an enterprise qualifies for the 15% or 17% CIT rate, as provided in (2) and (3), is the total revenue of the immediately preceding tax period. The method for determining total revenue as the basis for application shall be stipulated by the Government.
CIT rates for certain specific activities are as follows:
  • Oil and gas exploration and exploitation: from 25% to 50%. The specific rate applicable to each petroleum contract shall be decided by the Prime Minister based on location, exploitation conditions, and reserve capacity.
  • Exploration and exploitation of precious and rare natural resources (including platinum, gold, silver, tin, tungsten, antimony, gemstones, rare earths, and other rare resources as prescribed by law): 50%. For mines where 70% or more of the allocated area lies in regions with exceptionally difficult socio-economic conditions, the applicable rate is 40%.

3b. The transfer of a subsidiary is exempt from value-added tax but subject to declaration and payment of corporate income tax.

Official Letter No. 3684/CT-CS dated September 10, 2025 of the Tax Department regarding tax policy, specifically as follows:
  • According to the guidance of the Tax Department, in the case where a company transfers its wholly-owned subsidiary to another company, if such transfer is determined to be a capital transfer, it shall fall under the category not subject to value-added tax in accordance with Clause 8 Article 4 of Circular No. 219/2013/TT-BTC.
  • With respect to corporate income tax (CIT), in the case where a company transfers its entire capital contribution equivalent to 100% of the charter capital in a subsidiary in the form of a capital transfer associated with real estate, in accordance with the provisions of the Law on Enterprises and the Law on Investment, the company shall be required to declare and pay CIT under real estate transfer activities. The tax declaration shall be made using Form No. 06/TNDN issued together with Circular No. 80/2021/TT-BTC.

3c. Notes on Provisional Payment of Corporate Income Tax.

Official Letter No. 3904/CT-CS dated September 18, 2025 of the Tax Department responding to petitions related to the provisional payment of corporate income tax, specifically as follows:
  • According to the Tax Department, the Law on Tax Administration and its implementing instruments already provide regulations on the deadline for quarterly provisional corporate income tax payments and the total amount of CIT to be provisionally paid quarterly. Specifically, under Clause 1, Article 55 of the Law on Tax Administration No. 38/2019/QH14, the deadline for provisional quarterly CIT payments is the 30th day of the first month of the following quarter at the latest.
  • The total CIT provisionally paid for all four quarters must not be less than 80% of the CIT payable under the annual finalization. If the enterprise pays less than this threshold, late payment interest shall be charged on the underpaid tax amount (Clause 3, Article 1 of Decree No. 91/2022/ND-CP).

4. Social Insurance – Trade Union

a. From July 1, 2025, Certificates of Social Insurance Leave issued under the old form will no longer be accepted.

Official Letter No. 5761/BYT-KCB dated August 27, 2025 of the Ministry of Health regarding the settlement of difficulties in implementing social insurance regimes for employees, specifically as follows:
  • Accordingly, the Ministry of Health notes that Certificates of Social Insurance Leave issued prior to the effective date of Circular No. 25/2025/TT-BYT (July 1, 2025) shall remain valid as the basis for entitlement to social insurance benefits. For Certificates issued after July 1, 2025, it is mandatory to use the new form promulgated under Circular No. 25/2025/TT-BYT. The difference between the new form and the old form (issued under Circular No. 18/2022/TT-BYT) lies in the addition of information on the employee’s citizen identification number/identity card number/passport number/personal identification number; other contents remain unchanged from the old form.
  • During the initial implementation of Circular No. 25/2025/TT-BYT, for documents issued by hospitals still using the old form and not yet switched to the new form, in order to ensure employees’ rights and avoid inconvenience, the Ministry of Health has requested that enterprises prepare a list of employees whose documents were issued by hospitals in non-compliance with regulations, and submit an official letter to the Department of Health or the health authority of the relevant ministries/agencies managing such hospitals, requesting the supplementation of information on the documents already issued, as prescribed in Point b, Clause 4, Article 28 of Circular No. 25/2025/TT-BYT.
As for Certificates of Social Insurance Leave without the hospital’s seal due to the seal not yet being updated to the new address following a merger, the Ministry of Health has stated that, under Clause 8, Article 69 of Decree No. 188/2025/ND-CP, medical examination and treatment establishments are permitted to continue using their old seals until new seals are issued.

b. Online Procedures for Unemployment Benefits applicable from September 17, 2025.

Decision No. 1295/QD-TTPVHCC dated September 17, 2025 of the People’s Committee of Hanoi City announcing the List of administrative procedures on unemployment insurance to be piloted on the National Public Service Portal under the management competence of the Department of Home Affairs of Hanoi City, specifically as follows:
This Decision announces six procedures concerning the entitlement to and termination of unemployment benefits to be piloted by the Hanoi Department of Home Affairs on the National Public Service Portal as from September 17, 2025, including:
  • Settlement of entitlement to unemployment benefits
  • Monthly notification of job search activities.
  • Settlement of entitlement to unemployment benefits
  • Settlement of entitlement to unemployment benefits
  • Transfer of entitlement to unemployment benefits (integrated procedure for transfer-out and transfer-in).
  • Termination of entitlement to unemployment benefits.
This Decision takes effect from the date of signing.

5. OTHER

a. Household Businesses to Receive Free Accounting Software and Invoicing Support from the State.

Official Letter No. 3914/CT-CS dated September 18, 2025 of the Tax Department regarding the response to the petition of the Vietnam Banks Association:
  • With respect to the use of invoices by household businesses, the Tax Department notes that, pursuant to the provisions of Decree No. 70/2025/NĐ-CP, from June 1, 2025, when selling goods or providing services directly to consumers, household businesses under the lump-sum tax regime with annual revenue exceeding VND 1 billion must issue electronic invoices generated from cash registers connected to and transmitting data to the tax authority, and deliver such invoices to buyers. The electronic invoice data is already available on the tax authority’s system, allowing both sellers and buyers to look up invoices on the system without the need to print paper copies.
  • Under the current guidance provided in Circular No. 40/2021/TT-BTC, there is no provision requiring lump-sum household businesses to retain purchase invoices or supporting documents.
  • As stipulated at Point b, Clause 4, Article 13 of Circular No. 40/2021/TT-BTC, in cases where a lump-sum household business changes its business scale (premises size, labor use, or revenue), it must declare adjustments and supplements to the Tax Return using Form No. 01/CNKD. The tax authority, based on the household business’s tax return and the tax sector’s database, shall issue a Notice of adjustment of lump-sum tax if it determines that declared revenue has changed by 50% or more compared to the previously assessed lump-sum revenue, effective from the time of such change within the tax year.
Furthermore, pursuant to Clause 3, Article 12 of Resolution No. 198/2025/QH15, the State shall allocate funding to provide free shared digital platforms and accounting software for small and micro enterprises, household businesses, and individual business households. At present, the Ministry of Finance is drafting a Decree guiding the implementation of this Resolution, which will include provisions on the measures to support the free provision of shared digital platforms and accounting software for small and micro enterprises, household businesses, and individual businesses.

b. Notes on conditions for exemption from business license fee during business suspension.

Official Letter No. 1355/QNG-QLDN1 dated September 4, 2025, of the Quang Ngai Provincial Tax Department on guidance regarding business license fees
  • The conditions for exemption from the business license fee during business suspension are stipulated in Clause 2, Article 1 of Decree No. 22/2020/NĐ-CP and Clause 4, Article 1 of Circular No. 65/2020/TT-BTC, as follows: a written request for suspension of production and business operations must be submitted to the tax authority or the business registration authority before the deadline for payment of the business license fee (January 30 each year), and the business license fee of the year in which suspension is requested has not yet been paid.
  • Accordingly, if a Company has submitted a written request to the business registration authority to suspend production and business operations in the calendar year 2025 (from January 1 to December 31) before the license fee payment deadline (before January 30) and has not yet paid the 2025 business license fee, then the Company is not required to pay the license fee for 2025.
However, if the above conditions are not satisfied, the Company must pay the business license fee for 2025.

6. INVOICES

a. Some notes on recording the purchaser’s tax identification number on invoices.

Official Letter No. 3955/CT-CS dated September 19, 2025 of the Tax Department regarding e-invoices, specifically as follows:
  • The presentation of the buyer’s name, address, and taxpayer identification number on e-invoices shall comply with the provisions of Clause 5 and Point c, Clause 14, Article 10 of Decree No. 123/2020/ND-CP (as amended and supplemented at Points a and d, Clause 7, Article 1 of Decree No. 70/2025/ND-CP). Accordingly, in cases where the buyer is a business establishment with a TIN, the buyer’s name, address, and TIN stated on the invoice must be consistent with the information on the enterprise/branch registration certificate, household business registration certificate, tax registration certificate, or TIN notification
  • If the purchaser does not have a tax identification number, the TIN is not required to be shown on the e-invoice. In addition, in cases specified at Point c, Clause 14 , Article 10, it is not mandatory to indicate the purchaser’s name, address, or TIN on the invoice. As from June 1, 2025, where the purchaser provides a TIN or personal identification number, the invoice must also include such TIN or personal identification number.
  • For e-invoices generated from cash registers, the invoice must show the purchaser’s name, address, tax identification number/personal identification number/telephone number if so requested by the purchaser (see Clause 3, Article 11 of Decree No. 123/2020/ND-CP, as amended and supplemented under Clause 8, Article 1 of Decree No. 70/2025/ND-CP).

b. Notes on issuing and adjusting invoices for sales with trade discounts.

Official Letter No. 1802/CTH-QLDN3 dated September 3, 2025, of the Can Tho City Tax Department regarding trade discount invoices, specifically as follows:
In this document, the Can Tho City Tax Department provided guidance on determining VAT taxable prices in cases of trade discounts, how to present discount amounts on invoices, and how to handle adjustment invoices when discounts are based on quantity or sales volume. Specifically:
VAT taxable price: The VAT taxable price is the selling price after deducting the trade discount given to customers, excluding VAT (Clause 2, Article 14 of Decree No. 181/2025/NĐ-CP).
Presentation on invoices: The invoice must clearly indicate the trade discount amount (Point đ, Clause 6, Article 10 of Decree No. 123/2020/NĐ-CP.
Discounts based on quantity or sales volume:
  • Adjustment on the last purchase/next period invoice: The discount amount shall be adjusted on the sales/service invoice of the last purchase or subsequent period, ensuring the discount amount does not exceed the value of goods or services recorded on that invoice.
  • Issuing an adjustment invoice: An adjustment invoice may be issued together with a list of the invoices subject to adjustment, including amounts and tax adjustments. The list must be kept at the entity and presented upon request by the tax authority or other competent state authority (Clause 13, Article 1 of Decree No. 70/2025/NĐ-CP amending and supplementing Article 19 of Decree No. 123/2020/NĐ-CP.
  • Tax return adjustments: Based on the adjustment invoice and related records, both the buyer and the seller shall declare adjustments to sales revenue, purchase revenue, input and output VAT in the period when the adjustment invoice is issued.
  • Adjustment invoice for trade discounts: This is an adjustment invoice for previously issued invoices, used to adjust differences in amounts only; it is not used to declare sales revenue already incurred. Accordingly, in the electronic invoice system of the General Department of Taxation, the line “Total amount before tax” will display the trade discount amount, while the line “Total trade discount amount” will display as 0.

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Personal income tax: Comprehensive Guide for Residents and Expats

what is personal income tax in vietnam

PERSONAL INCOME TAX IN VIETNAM FOR EXPATS

 

Personal Income Tax in Vietnam, governed by the Law on Personal Income Tax No. 04/2007/QH12 and its amendments (latest in 2025), is a critical obligation for individuals earning income in Vietnam. Whether you’re a local resident, an expat, or a digital nomad, understanding PIT ensures compliance and optimizes your financial planning. This guide covers tax rates, deductions, filing procedures, and more to address your needs—whether you’re seeking rates (informational), filing steps (transactional), or official resources (navigational).  

Why does PIT matter? With Vietnam’s economy growing and stricter tax enforcement in 2025, knowing your obligations prevents penalties and maximizes deductions. Ready to navigate Vietnam’s tax system? 

1/ Determining Your Tax Residency Status 

Your tax obligations hinge on your residency status. Under Vietnam’s tax law, you’re a tax resident if you meet one of these criteria: 

  • Stay in Vietnam for 183 days or more in a calendar year or 12 consecutive months. 
  • Hold a permanent residence card or have a leased property in Vietnam for 183+ days. 
  • Otherwise, you’re a non-resident, taxed only on Vietnam-sourced income. 

Special cases: Digital nomads or expats in Vietnam may unintentionally become tax residents if they overstay the 183-day threshold. To avoid this, maintain proof of residency elsewhere (e.g., tax certificates from another country).  

Tax residency status

Comparison: Tax Residents vs. Non-Residents 

Criteria  Tax Resident  Non-Resident 
Taxable Income Scope  Global income  Vietnam-sourced income only 
Tax Rates  Progressive (5%-35%)  Flat 20% (employment); 0.1%-20% (others) 
Filing Obligations  Annual finalization, monthly/quarterly  Pay-at-source or annual declaration 

This table highlights why residency status is critical for tax planning. 

2/ Types of Taxable Income 

Personal income tax applies to various income types, including: 

  • Employment income: Salaries, wages, bonuses, allowances, and fringe benefits. 
  • Non-employment income: Business profits, dividends, capital gains, real estate transfers, royalties, inheritances, gifts, and prizes (e.g., lottery winnings). 
  • Foreign currency income: Converted to VND using the State Bank of Vietnam exchange rate at the transaction date. 
  • Emerging categories: Income from digital services (e.g., content creation, online consulting) and remote work is increasingly scrutinized in 2025. 

income streams

3/ Personal Income Tax Rates 2025 

Vietnam uses progressive tax rates for residents and flat rates for non-residents: 

  • Residents: Taxed from 5% (up to 5 million VND/month) to 35% (over 80 million VND/month). 
  • Non-residents: 20% on employment income; other incomes (e.g., real estate, capital gains) range from 0.1%-20%. 

Personal Income Tax Rate Tables 

Monthly Taxable Income (VND)  Tax Rate  Tax Amount (VND)  Approx. USD 
Up to 5 million  5%  0-250,000  $0-10 
5-10 million  10%  250,000-750,000  $10-30 
10-18 million  15%  750,000-1,650,000  $30-65 
18-32 million  20%  1,650,000-3,650,000  $65-144 
32-52 million  25%  3,650,000-6,650,000  $144-262 
52-80 million  30%  6,650,000-11,250,000  $262-444 
Over 80 million  35%  11,250,000+  $444+ 

Note: Non-residents pay a flat 20% on employment income, converted to ~$800/month for a $4,000 salary. 

4/ Deductions and Allowances 

Reduce your taxable income with these deductions: 

  • Personal deduction: 11 million VND/month (~$434 USD). 
  • Dependent deduction: 4.4 million VND/month per dependent (e.g., children under 18, disabled spouses, low-income parents). Register with a Tax Identification Number (TIN) and documents (birth certificates, income proofs). 
  • Other deductions: Compulsory insurances (social, health, unemployment), charitable donations, voluntary pension contributions. 

Checklist for claiming deductions: 

  • Register dependents with tax authorities. 
  • Submit proof of income for dependents earning below the threshold. 
  • Keep records of charitable donations (receipts, bank transfers). 

See Our Full Range of Tax Solutions

5/ Tax-Exempt Income and Benefits 

Certain incomes and benefits are exempt from PIT: 

  • Exempt incomes: Bank interest, insurance compensations, retirement pensions, family property transfers, scholarships, certain agricultural incomes. 

Non-taxable benefits:  

  • One annual round-trip airfare for expats. 
  • School fees for expat children (direct employer payments). 
  • Mid-shift meals (capped at regional minimum wage). 
  • Housing (up to 15% of total income), uniforms (up to 5 million VND/year if cash). 

Example: An expat’s employer pays $2,000 for their child’s school fees directly—fully exempt from PIT. 

6/ How to Calculate Your Personal Income Tax in Vietnam 

Follow these steps to calculate your PIT: 

  1. Determine residency status: Resident or non-resident. 
  1. Calculate taxable income: Gross income minus exemptions. 
  1. Apply deductions: Personal, dependent, and insurance deductions. 
  1. Apply tax rates: Use progressive rates (residents) or flat rates (non-residents). 

Example: A resident expat earns 50 million VND/month with two dependents: 

  • Taxable income: 50.000.000 – 11.000.000 (personal) – 8.800.000 (dependents) = 30.200.000 VND. 
  • Tax: (10.000.000 × 5%) + (8.000.000× 10%) + (12.200.000 × 15%) = 500.000 + 800.000+ 1.830.000 = 3.130.000 VND (~$123 USD). 

Tool: Use the e-portal calculator https://luatvietnam.vn/tinh-thue-thu-nhap-ca-nhan.html  for accuracy. 

7/ Filing and Payment Procedures 

Vietnam’s tax year runs from January 1 to December 31. Key procedures: 

  • Withholding: Employers deduct PIT monthly/quarterly. Self-declare for multiple income sources. 

Deadlines: 

  • Monthly: 20th of the next month. 
  • Quarterly: End of the first month post-quarter. 
  • Annual finalization: March 31 (employers), April 30 (individuals). 

Methods: File via GDT e-portal https://canhan.gdt.gov.vn/ICanhan, local tax offices, or authorized agents. Payments via bank transfer or State Treasury. 

Leaving Vietnam: Finalize taxes 45 days before departure to avoid immigration issues. 

Checklist for filing: 

  • Obtain a Tax Identification Number (TIN). 
  • Prepare income statements, deduction proofs. 
  • Verify filing status on the GDT portal. 

8/ Double Taxation Agreements (DTAs) 

Vietnam has DTAs with over 80 countries (e.g., US, UK, Singapore) to prevent double taxation. Benefits include exemptions or credits for taxes paid abroad. 

How to claim relief: 

  • Notify tax authorities 15 days before payment. 
  • Submit foreign tax payment proofs (e.g., tax certificates). 
  • Example: A US expat pays 10% tax in Vietnam on dividends, then claims a credit in the US. 

Are you leveraging DTAs to avoid double taxation? 

9/ Special Considerations for Expats and Foreigners 

Expats face unique PIT challenges: 

  • US expats: Report global income to the IRS (via FBAR, FEIE, FTC) while complying with Vietnam’s residency rules. 
  • Short-term assignments: “Economic employer” rules may apply, requiring payroll withholding. 
  • Digital nomads: Risk being taxed as residents if staying 183+ days; global income becomes taxable. 
  • 2025 updates: The General Department of Taxation (GDT) uses AI to monitor digital transactions, enforcing taxes on crypto gains and online services. 

Example: A digital nomad staying 200 days in Vietnam may owe PIT on worldwide income unless proving non-residency.

10/ Common Mistakes, Penalties, and Tips for Compliance

Common mistakes:

  • Underreporting benefits: Expats often overlook taxable benefits like housing allowances or cash-based uniform payments, leading to incorrect tax filings.

  • Missing dependent registration deadlines: Failing to register dependents (e.g., children, spouses) by the deadline (typically March 31) forfeits deductions of 4.4 million VND/month per dependent.

  • Ignoring Double Taxation Agreements (DTAs): Not claiming DTA benefits with over 80 countries (e.g., US, UK) results in unnecessary double taxation.

Penalties:

  • Late filing: A 0.05% daily interest penalty applies to overdue tax submissions, accumulating quickly.

  • Underpayment: Fines range from 10%-20% of the underpaid amount, with potential legal action for significant violations.

Tips for expats in Vietnam compliance:

  • Engage professional tax agents: Complex cases, such as multi-source incomes or DTA applications, benefit from expert guidance. Vina TPT, with over a decade of experience, offers tailored PIT solutions, including tax filing, deduction optimization, and multilingual reporting for expats and FDI businesses.

  • Track days in Vietnam: Monitor your stay to confirm tax residency status (183+ days triggers global income taxation). Use calendar apps or consult professionals to avoid unintended residency.

  • Reconcile income records annually: Cross-check payslips, contracts, and bank statements to ensure accurate declarations.

  • Leverage expert support: As an expat, I’ve relied on Vina TPT to navigate Vietnam’s PIT complexities. Their expertise in tax compliance, work permits, and payroll management saved me time and ensured no penalties, allowing me to focus on my work

Comparison: Vietnam’s PIT rates (5%-35%) are competitive with Thailand’s (0%-35%) but higher than Singapore’s flat 0%-22% for residents. Partnering with a service like Vina TPT ensures you optimize deductions and comply with local laws, avoiding costly errors.

10/ Simplifying Tax Procedures with Vina TPT’s PIT Services for Foreigners

Navigating Vietnam’s Personal Income Tax system can be complex, especially for foreigners unfamiliar with local regulations, language barriers, and intricate filing requirements. Vina TPT PIT Services offers a comprehensive PIT service tailored for expatriates and non-residents, streamlining every aspect of tax compliance. With over a decade of experience, Vina TPT provides:

  • End-to-end tax filing: From obtaining a Tax Identification Number (TIN) to submitting accurate declarations via the GDT e-portal, ensuring timely compliance with monthly, quarterly, and annual deadlines.

  • Deduction optimization: Expert guidance to maximize personal and dependent deductions, as well as leveraging Double Taxation Agreements (DTAs) with over 80 countries to minimize tax liabilities.

  • Multilingual support: Clear communication in English and other languages to assist expats with residency status determination, income reporting, and penalty avoidance.

  • Payroll and compliance solutions: For expats on short-term assignments or digital nomads, Vina TPT handles payroll withholding, work permits, and monitors the 183-day residency threshold to prevent unintended tax obligations.

  • AI-driven accuracy: Using advanced tools to track digital transactions (e.g., crypto gains, online services), ensuring compliance with 2025’s stricter tax enforcement.

Let’s Find the Best Tax Solution for You

11/ FAQ on Personal Income Tax in Vietnam 

  • What is the threshold for PIT filing in Vietnam? 

Residents with taxable income above 11 million VND/month or non-residents with any Vietnam-sourced income must file. 

  • How do I register for a Tax Identification Number (TIN)? 

Apply via the GDT e-portal or local tax offices with ID/passport and proof of residency. 

  • Are overseas remittances taxable? 

No, unless used for taxable activities (e.g., investments). 

  • What happens if I overpay PIT? 

Request a refund via the GDT portal with proof of overpayment. 

  • Can I deduct home office expenses as a remote worker? 

No, unless registered as a business expense with proper invoices. 

Why choose Vina TPT?

Their expertise eliminates the stress of navigating Vietnam’s tax system, saving you time and preventing costly errors. Whether you’re a digital nomad, a corporate expat, or managing multiple income sources, Vina TPT ensures seamless compliance and financial peace of mind.

Book a Consultation with Our Expert

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