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Circular No. 111/2013/TT-BTC\r\ndated August 15, 2013 of the Minister of Finance on guidelines for the\r\nimplementation of the Law on Personal Income Tax, the Law on amendments to the\r\nLaw on Personal Income Tax, and the Government's Decree No. 65/2013/ND-CP on\r\nelaboration of some Articles of the Law on Personal Income Tax and the Law on\r\namendments to the Law on Personal Income Tax, which comes into force from\r\nOctober 01, 2013, is amended by:
1. Circular No.\r\n119/2014/TT-BTC dated August 25, 2014 of the Ministry of Finance on amendments\r\nto some Articles of Circular No. 156/2013/TT-BTC dated November 06, 2013,\r\nCircular No. 111/2013/TT-BTC dated August 15, 2013, Circular No.\r\n219/2013/TT-BTC dated December 31, 2013, Circular No. 08/2013/TT-BTC dated\r\nJanuary 10, 2013, Circular No. 85/2011/TT-BTC dated June 17, 2011, Circular No.\r\n39/2014/TT-BTC dated March 31, 2014, and Circular No. 78/2014/TT-BTC dated June\r\n18, 2014 of the Ministry of Finance for reform and simplification of tax\r\nformalities, which comes into force from September 01, 2014.
2. Circular No.\r\n151/2014/TT-BTC dated October 10, 2014 of the Ministry of Finance on guidance\r\non implementation of Government’s Decree No. 91/2014/ND-CP dated October 01,\r\n2014 on amendments to Decrees on taxation, which comes into force from November\r\n15, 2014.
3. Circular No.\r\n92/2015/TT-BTC dated June 15, 2015 of the Ministry of Finance on guidelines for\r\nVAT and personal income tax incurred by residents conducting business,\r\namendments to some Articles on personal income tax of the Law No. 71/2014/QH13\r\non amendments to tax laws and the Government's Decree No. 12/2015/ND-CP dated\r\nFebruary 12, 2015 on guidelines for implementation of the Law on amendments to\r\nLaws and Decrees on taxation, which comes into force from July 30, 2015.
4. Circular No.\r\n25/2018/TT-BTC dated March 16, 2018 of the Ministry of Finance on guidelines\r\nfor the Government’s Decree No. 146/2017/ND-CP dated December 15, 2017 on\r\namendments to some Articles of the Circular No.78/2014/TT-BTC dated June 18,\r\n2014 of the Ministry of Finance and Circular No.111/2013/TT-BTC dated August\r\n15, 2013 of the Ministry of Finance, which comes into force from May 01, 2018.
Pursuant to the Law\r\nNo. 04/2007/QH12 dated November 21, 2007 on Personal Income Tax;
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Pursuant to the Law\r\nNo. 78/2006/QH11 on Tax Administration dated November 29, 2006;
Pursuant to the Law\r\nNo. 21/2012/QH13 dated November 20, 2012 on amendments to some Articles of the\r\nLaw on Tax Administration;
Pursuant to\r\nGovernment’s Decree No. 65/2013/ND-CP dated June 27, 2013 on elaboration of\r\nimplementation of some Articles of the Law on Personal Income Tax and the Law\r\non amendments to some Articles of the Law on Personal Income Tax;
Pursuant to\r\nGovernment’s Decree No. 83/2013/ND-CP dated July 22, 2013 on elaboration of\r\nimplementation of some Articles of the Law on Tax Administration and the Law on\r\namendments to some Articles of the Law on Tax Administration;
Pursuant to\r\nGovernment’s Decree No. 118/2008/ND-CP dated November 27, 2008 on functions,\r\ntasks, powers and organizational structure of the Ministry of Finance;
At the request of the\r\nDirector of the General Department of Taxation;
The Minister of\r\nFinance provides guidance on the implementation of some Articles of the Law on\r\nPersonal Income Tax, the Law on amendments to the Law on Personal Income Tax,\r\nand the Government's Decree No. 65/2013/ND-CP dated June 27, 2013 on\r\nelaboration of some Articles of the Law on Personal Income Tax and the Law on\r\nthe amendments to the Law on Personal income tax:2
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Taxpayers are\r\nresidents and non-residents mentioned in Article 2 of the Law on Personal Income\r\nTax, Article 2 of the Government's Decree No. 65/2013/NĐ-CP dated June 27, 2013\r\non guidelines for the Law on Personal Income Tax and the Law on amendments to\r\nthe Law on Personal Income Tax (hereinafter referred to as “Decree No.\r\n65/2013/ND-CP”) who earn taxable incomes as prescribed in Article 3 of the Law\r\non Personal Income Tax and Article 3 of Decree No. 65/2013/ND-CP.
Taxable income is\r\ndetermined as follows:
Taxable income earned\r\nby a resident is the income earned within and beyond Vietnam’s territory\r\nregardless of the place where income is paid; 4
Any individual who is\r\na citizen of a country or territory that has entered into an agreement on\r\ndouble taxation and prevention of tax avoidance with Vietnam, and also a\r\nresident in Vietnam shall calculate personal income tax from the month that\r\nindividual arrives at Vietnam (if the individual goes to Vietnam for the first\r\ntime) to the month in which the labor contract expires and the individual\r\nleaves Vietnam without following procedures for consular certification to avoid\r\ndouble taxation according to the double taxation agreement between the two\r\ncountries. 5
Taxable income of a\r\nnon-resident is income earned in Vietnam, regardless of the place where income\r\nis paid and received. 6
1. A resident is a person\r\nthat meets one of the conditions below:
a) He/she has been\r\npresent in Vietnam for at least 183 days in a calendar year or for 12\r\nconsecutive months from the first day of his/her presence in Vietnam (the date\r\nof arrival and date of departure are considered as 01 day). The date of arrival\r\nand date of departure depend on the certification of the immigration authority\r\non his/her passport (or laissez-passers) when that person enters and leaves\r\nVietnam. If the person enters and leaves Vietnam within one day, it will be\r\nconsidered as a day of residence.
A person in Vietnam\r\ndefined in this Point is the presence of that person in Vietnam’s territory.
b) He/she has a regular\r\nresidence in Vietnam in one of the following cases:
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b.1.1) Regarding\r\nVietnamese citizens: a place where that person regularly, stably and\r\nindefinitely lives, and which has been registered as a permanent residence as\r\nprescribed by regulations of law on residence.
b.1.2) Regarding\r\nforeigners: the permanent residence written in the permanent residence card or\r\nthe temporary residence when applying for the temporary residence card issued\r\nby a competent authority affiliated to the Ministry of Public Security.
b.2) He/she rents a house\r\nin Vietnam according to regulations of law on housing under a contract that has\r\na term of at least 183 days in the tax year. To be specific:
b.2.1) A person who has\r\nno regular residence defined in Point b.1 Clause 1 of this Article will be considered\r\nas a resident if he/she has a total house lease period of at least 183 days in\r\nthe tax year under various lease contracts, even if he/she rents houses in\r\ndifferent locations.
b.2.2) The rented houses\r\nmay be hotels, guesthouses, motels, offices, etc. whether they are rented by\r\nthe person or their employer.
If the person has a\r\nregular residence in Vietnam according to this Clause but his/her actual\r\npresence in Vietnam is shorter than 183 days in the tax year and he/she fails\r\nto prove his/her residency in any country, that person will be considered as a\r\nresident of Vietnam.
The residency in another\r\ncountry shall be proved by the Certificate of residence. If the person is a\r\ncitizen of a country or territory that has signed a tax agreement with Vietnam\r\nand does not issue the Certificate of residence, that person shall present a\r\nphotocopy of the passport to prove the period of residence.
2. A non-resident is a\r\nperson who fails to meet any of the conditions specified in Clause 1 of this\r\nArticle.
3. Taxpayers in some\r\nspecific cases are identified as follows:
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a.1) If only one person\r\nis registered in the Certificate of Business Registration, the taxpayer is person\r\nwhose name is registered in the Certificate of Business Registration.
a.2) If multiple people\r\nare registered in the Certificate of Business Registration and participate in\r\nthe business, taxpayers are the persons whose names are registered in the Certificate\r\nof Business Registration.
a.3) If multiple members\r\nof a household participate in the business but only one person is registered in\r\nthe Certificate of Business Registration, the taxpayer is the person whose name\r\nis registered in the Certificate of Business Registration.
a.4) If the person or\r\nhousehold conducts business without the Certificate of Business Registration\r\n(or practice certificate), the taxpayer is the person who is conducting\r\nbusiness.
a.5) When leasing a\r\nhouse, the right to use land, water surface, and other property without\r\nbusiness registration, the taxpayer is the person that owns the house, the\r\nright to use land, water surface and other property. If the house or the right\r\nto use land, water surface, and other property is under the ownership of\r\nmultiple persons, the taxpayers are all the owners.
b) With regard to other\r\nindividuals that earn taxable incomes.
b.1) When transferring\r\nreal estate under a co-ownership, taxpayers are the co-owners of such real\r\nestate.
b.2) If the person authorized\r\nto manage real estate has the right to transfer real estate or rights similar\r\nto those of the real estate owner according to law regulations, the taxpayer is\r\nthe authorizing person.
b.3) If the person that\r\ntransfers the ownership, the right to use protected entities according to the\r\nLaw on Intellectual Property and the Law on Technology Transfer is the co-owner\r\nor co-author, the taxpayer is co-owner or co-author that earns income from such\r\ntransfer.
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4. Taxpayers defined in\r\nClause 1 and Clause 2 of this Article include:
a) Persons that hold\r\nVietnamese nationality, including persons appointed to work or study overseas,\r\nand earn taxable incomes.
b) Persons that do not\r\nhold Vietnamese nationality but earn taxable incomes, including foreigners\r\nworking in Vietnam, foreigners that are not present in Vietnam but earn taxable\r\nincomes from Vietnam.
According to Article 3 of\r\nthe Law on Personal Income Tax and Article 3 of the Decree No. 65/2013/ND-CP,\r\nincomes subject to personal income tax (hereinafter referred to as “taxable\r\nincomes”) include:
1. Incomes from business
Incomes from business are\r\nincomes earned from the production and trade. To be specific:
a) Incomes from\r\nproduction and trade in goods and services that belong to all industries\r\naccording to law regulations such as production, good sale, construction,\r\ntransport, restaurants, service provision, including lease of houses, right to\r\nuse land, water surface, and other property.
b) Incomes from freelance\r\nworks of individuals in the fields that are granted licenses or practice\r\ncertificates as prescribed by law.
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2. Incomes from wages and\r\nremunerations
Incomes from wages and\r\nremunerations (hereinafter referred to as “wages”) are incomes paid to\r\nemployees by employers, including:
a) Wages, remunerations,\r\nand other amounts paid as wages or remunerations in cash or not in cash.
b) Allowances and\r\nbenefits, except for:
b.1) Monthly benefits and\r\nallowances, lump-sum allowances according to regulations of law on incentives\r\nfor contributors.
b.2) Monthly allowances\r\nand lump-sump allowances for persons that participate in the resistance\r\nmovements, national defense, fulfillment of international tasks, and discharged\r\nvolunteers.
b.3) Benefits for\r\nnational defense and security; subsidies for the armed forces.
b.4) Benefits for\r\ndangerous or harmful works.
b.5) Benefits for\r\nemployees in disadvantaged areas.
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b.7) Benefits for\r\nbeneficiaries of social security according to law regulations.
b.8) Benefits for senior\r\nofficers.
b.9)
b.10) Benefits for\r\nmedical employees in villages.
b.11) Occupational\r\nbenefits.
The allowances and\r\nbenefits that are not included in taxable incomes according to guidance in\r\nPoint b Clause 2 of this Article shall be defined by competent authorities.
If the documents on allowances\r\nand benefits are applicable to the public sector, other economic sectors and\r\nbusiness establishments shall calculate allowances and benefits according to\r\nsuch documents.
If the actual benefits\r\nand allowances received are in excess of those stated above, the excess shall\r\nbe included in taxable incomes.
Lump-sum moving\r\nallowances for foreigners that reside in Vietnam and Vietnamese people working\r\noverseas shall be deducted in accordance with the labor contract or collective\r\nbargaining agreement.
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d) Payments for\r\nparticipation in business associations, Boards of Directors, Control Boards,\r\nproject management boards, management councils, professional associations, and\r\nother organizations.
dd) Other benefits in\r\ncash or not in cash apart from wages paid to the taxpayer by the employer in\r\nany shape or form:
dd.1) 8 Payments for\r\nhousing, electricity, water supply and associated services (if any), excluding\r\nbenefits in terms of housing, electricity, water supply, and associated\r\nservices (if any) of housing built by the employer for serving employees in\r\nindustrial parks free of charge; housing built by the employer in disadvantaged\r\nareas and extremely disadvantaged areas that is provided free of charge for\r\nemployees working therein.
If the person stays at\r\nthe workplace, the taxable income depends on the house rent or depreciation\r\nexpense, payments for electricity, water supply, and other services according\r\nto the ratio of area that person uses to the total area of the workplace.
The house rent,\r\npayments for electricity and water supply, and payments for associated services\r\n(if any) paid by the employer on behalf of the employee shall be included in\r\ntaxable income according to the actual amount paid on behalf of the employee.\r\nNevertheless, the amount must not exceed 15% of the total taxable income\r\n(excluding house rent, payments for electricity, water supply, and associated\r\nservices (if any)) earned at the workplace regardless of income payer.”
dd.2) 9 Life insurance\r\npremiums, premiums of other optional insurance with accrual of premiums,\r\nvoluntary pension insurance premiums or contributions to the voluntary pension\r\nfund paid on the employee’s behalf.
If the employer buys\r\noptional insurance without accrual of premiums for their employee (including\r\ninsurance of insurers that are not established under Vietnam’s law but\r\npermitted to sell insurance in Vietnam), such premiums shall not be included in\r\ntaxable income of the employee. Optional insurance without accrual of premiums\r\nare insurance products, including health insurance, death insurance (except for\r\ndeath insurance with refund policy), etc. from which policyholders do not\r\nreceive the accrued amount of premiums apart from the insurance payout or\r\nindemnities paid by the insurer under insurance policies.”
dd.3) Membership fees and\r\nother expenses on services serving individuals, including healthcare,\r\nentertainments, sports, recreation. To be specific:
dd.3.1) Membership fees\r\n(such as membership card of golf course, tennis course, cultural, artistic,\r\nsports clubs, etc.) in case where the card specifies the user or group of\r\nusers. If the card is shared without specific users, the fees shall not be\r\nincluded in taxable incomes.
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dd.4) Flat expenditures\r\non stationery, business trips, phone calls, costumes, etc. that are in excess\r\nof the limits prescribed by the State. Flat expenditures are not included in\r\ntaxable income in the following cases:
dd.4.1) With regard to\r\nofficials and employees in public service agencies, Communist Party’s agencies,\r\nassociations: the flat expenditure shall follow guiding documents promulgated\r\nby the Ministry of Finance.
dd.4.2) With regard to\r\nthe employees working in business establishments and representative offices:\r\nthe flat expenditure shall conform to the income that incurs corporate income\r\ntax and guiding documents of the Law on Enterprise Income Tax.
dd.4.3) With regard to\r\nthe employees in international organizations and representative offices of\r\nforeign organizations: the flat expenditure shall comply with regulations of\r\nsuch international organizations and representative offices of foreign\r\norganizations.
dd.5)
dd.6) Payments for\r\nrefresher courses for employees, which suit their professions or accords with\r\nplans of the employer, shall not be included in incomes earned by employees.
dd.7) Other benefits.
Other benefits paid to\r\nemployees by the employers, including payments during leave period or public\r\nholidays; payments for counseling, tax declaration services for a particular\r\nperson or group of people; payments for domestic servants including driver,\r\ncook, and other domestic servants that work under contracts, etc.
e) Rewards in cash or not\r\nin cash in any shape or form, including rewards in the form of securities,\r\nexcept for:
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e.1.1) Prize money\r\nassociated with honorary titles awarded by Ministries, central and provincial\r\nagencies and associations, excellent employee titles
e.1.2) Prize money\r\nassociated with the awards.
e.1.3) Prize money\r\nassociated with the titles awarded by the State.
e.1.4) Prize money\r\nassociated with the awards presented by associations and organizations\r\nbelonging to central and local political organizations, socio-political\r\norganizations, social organizations, professional-social organizations in\r\naccordance with to their charters and the Law on Emulation and Commendation.
e.1.5) Prize money\r\nassociated with the Ho Chi Minh Prize and National Prize.
e.1.6) Prize money\r\nassociated with medals or badges.
e.1.7) Prize money\r\nassociated with certificates of merit.
The authority to decide\r\nthe commendation and prize money associated with the titles and awards above\r\nshall be conformable with the Law on Emulation and Commendation.
e.2) Prize money\r\nassociated with national prizes and international prizes recognized by Vietnam.
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e.4) Rewards for\r\ndetecting and reporting violations against law to competent authorities.
g) Incomes below are not\r\nincluded in taxable incomes:
g.1) Supports provided by\r\nthe employer for medical examination and treatment of fatal diseases suffered\r\nby employees and their families.
g.1.1) Relative of the\r\nemployee in this case include children, legitimate adopted children,\r\nillegitimate children, stepchildren, spouse, parents, parents-in-law;\r\nstepparents, legitimate adoptive parents.
g.1.2) The support that\r\nis not included in taxable income is the actual paid amount according to\r\nhospital bills, but must not exceed the hospital fee paid by the employee and\r\nhis or her relative after the amount paid by the insurer is deducted.
g.1.3) The employer that\r\nprovide supports shall keep the copies of the hospital bills that are certified\r\nby the employer (if the employee and his or her relative pay for the remaining\r\namount after the insurer directly pay the medical facility), the copies of the\r\nhealth insurance payment certified by the employer (if the employee and his or\r\nher family pay the entire hospital fee and then receive insurance money from\r\nthe insurer) together with the papers proving the provision of supports for\r\nemployees and their relatives who suffer from fatal diseases.
g.2) Amounts received\r\naccording to regulations on using vehicles of state agencies, public service\r\nproviders, Communist Party’s organizations, and associations.
g.3) Amounts received\r\naccording to regulations on public housing.
g.4) Other payments\r\nreceived, apart from wages, for participation in consultation, appraisal, and\r\ninspection of legislative documents, Resolutions, political reports,\r\ninspectorates, serving votes, citizens; for costumes and other tasks directly\r\nserving the operation of the Office of the National Assembly, the Ethnic\r\nCommunities Council, committees of the National Assembly, the delegations of\r\nthe National Assembly, the Central Office, the departments of the Communist\r\nParty, City/Province Committees and their departments.
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If the employer pays cash\r\nfor their employees’ meals instead of providing mid-shift meals or lunch, such\r\nmoney is not included in the taxable income if it is conformable with the\r\nguidance of the Ministry of Labor, War Invalids and Social Affairs. If the\r\npayment is higher than the limit imposed by the Ministry of Labor, War Invalids\r\nand Social Affairs, the excess shall be included in taxable income.
Expenditures of\r\nstate-owned enterprises, public service agencies, Communist Party’s agencies,\r\nassociations shall not exceed the limits imposed by the Ministry of Labor, War\r\nInvalids and Social Affairs. Regarding non-public enterprises and\r\norganizations, the expenditures shall be decided by the head and the union\r\npresident, and shall not exceed the limits imposed on state-owned enterprises.
g.6) Payments for\r\nround-trip air tickets made by the employer for foreign employees in Vietnam or\r\nVietnamese employees overseas to go home once a year.
The basis for\r\ndetermination of the payment for air tickets is the labor contracts and the prices\r\nof air tickets from Vietnam to the other country and vice versa.
g.7) Tuition fees for\r\nchildren of foreign employees in Vietnam to study in Vietnam, for children of\r\nVietnamese employees overseas to study overseas from preschool to high school,\r\nwhich are paid by the employer on their behalf.
g.8) Amounts received\r\nfrom sponsors are not included in the taxable income if the sponsorship\r\nbeneficiary is a member of the sponsoring organization; the sponsorship is\r\nfunded by government budget or managed in accordance with regulations of the\r\nState from composting literary and artistic works, scientific research,\r\naccomplishment of political objectives of the State, or other activities that\r\nconforms to their charters.
g.9) Payments paid by the\r\nemployer for dispatching or reassigning foreign employees in Vietnam in\r\naccordance with labor contracts and international work schedules of some\r\nindustries such as petroleum, mineral extraction.
The basis of determination\r\nis the labor contract and payments for air tickets from Vietnam to the home\r\ncountry of the foreign employee and vice versa.
Example 1: Mr. X is a\r\nforeigner dispatched by contractor Y to an oil rig on the continental shelf of\r\nVietnam. According to the labor contract, the work cycle of Mr. X on this oil\r\nrig is 28 consecutive working days and 28 days off. The payments made by\r\ncontractor Y for the air tickets for Mr. X to fly from his country to Vietnam\r\nand vice versa for every time of changing shift, the helicopter that take Mr. X\r\nfrom the mainland to the oil rig and vice verse, the residence expense while\r\nMr. X is waiting for the helicopter shall not be included in the taxable income\r\nof Mr. X.
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3. Incomes from capital investment\r\n
Incomes from capital\r\ninvestment are personal incomes in the form of:
a) Interest on the loans\r\ngiven to other organizations, enterprises, business households, business\r\nindividuals and groups of business individuals according to loan contracts or agreements,\r\nexcept for the interests paid by credit institutions and foreign bank branches\r\naccording to Point g.1 Clause 1 Article 3 of this Circular.
b) Dividends earned from\r\ncapital contribution to purchase of shares.
c) 12 Profits from\r\ncapital contributions to limited liability companies, partnerships,\r\ncooperatives, joint-ventures, business cooperation contracts, and other forms\r\nof business under the Law on Enterprises and the Law on Cooperatives; profits\r\nfrom capital contribution in establishment of credit institutions according to\r\nthe Law on Credit Institutions, capital contributions to securities investment\r\nfund and other investment funds that are established and operate within the\r\nlaw.
Profits from capital\r\ninvestment of private companies and single-member limited liability companies\r\nunder the ownership of individuals shall not be included in taxable income.
d) The added value of\r\ncapital contribution received when the enterprise is dissolved, converted,\r\ndivided, split, merged, amalgamation, or upon capital withdrawal.
dd) Incomes from interest\r\non bonds, treasury bills, and other valuable papers issued by Vietnamese\r\norganizations, except for the incomes defined in Point g.1 and g.3 Clause 1\r\nArticle 3 of this Circular.
e) Incomes from capital\r\ninvestment in other forms, including capital contribution in kind, by\r\nreputation, rights to use land, patents.
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4. Incomes from capital\r\ntransfer
Incomes from capital\r\ntransfer are personal incomes in the form of:
a) Profits from capital\r\ncontributions to limited liability companies (including single-member limited\r\nliability companies), partnerships, cooperatives, business cooperation\r\ncontracts, people's credit funds, economic organizations, and other\r\norganizations.
b)
c) Incomes from other\r\nforms of capital transfer.
5. Incomes from real\r\nestate transfer
Incomes from real estate\r\ntransfer:
a) Incomes from\r\ntransferring rights to use land.
b) Incomes from\r\ntransferring rights to use land and property on the land. Property on the land\r\nincludes:
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b.2) Infrastructure and\r\nconstructions on the land, including off-the-plan constructions.
b.3) Other property on\r\nland, including agriculture, forestry and fishery products (such as plants and\r\nanimals).
c) Incomes from\r\ntransferring ownership of houses, including off-the-plan houses.
d) Incomes from\r\ntransferring rights to use land, rights to rent water surface.
dd) Incomes from capital\r\ninvestment by real estate for establishment of enterprises or increase in\r\ncapital of enterprises as prescribed by law.
e) Incomes from\r\ndelegating the management of real estate, in case the person delegated to\r\nmanage real estate has the right to transfer real estate or rights similar to\r\nthose of the real estate owner according to law regulations.
g) Other incomes from\r\nreal estate transfer in any form.
Regulations on\r\noff-the-plan houses and constructions in Clause 5 of this Article shall comply\r\nwith regulations of law on real estate trading.
6. Incomes from winning\r\nprizes
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a) Winning lottery prizes\r\npresented by lottery companies.
b) Wining prizes from\r\npromotion programs when buying products or services according to the Law on\r\nCommerce.
c) Winning prizes from\r\nthe types of betting permitted by law.
d)
dd) Winning prizes from\r\nthe games with prizes and the like held by economic organizations,\r\nadministrative agencies, associations, other organizations and individuals.
7. Incomes from copyright
Incomes from copyright are\r\nincomes from the transfer of ownership, rights to use the subjects of\r\nintellectual property rights according to the Law on Intellectual Property;\r\nincome from technology transfer according to the Law on Technology Transfer. To\r\nbe specific:
a) Subjects of\r\nintellectual property rights are specified in Article 3 of the Law on\r\nIntellectual Property and relevant guiding documents:
a.1) Subjects of\r\ncopyright, including literary, artistic, and scientific works; subjects of\r\nrights relevant to copyright, including video recordings, sound recordings of\r\nbroadcasted programs, program-carrying satellite signals.
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a.3) Subjects of rights\r\nto plant varieties that are propagating materials and harvested materials.
b) Subjects of technology\r\ntransfer are specified in Article 7 of the Law on Technology Transfer:
b.1) Transfer of\r\ntechnical know-hows.
b.2) Transfer of\r\ntechnological knowledge in forms of technological plans, technological\r\nprocesses, technical solutions, formulae, specifications, drawings, technical\r\ndiagrams, computer programs, information.
b.3) Transfer of\r\nsolutions for production rationalization and technological innovation.
Incomes from transfer of\r\naforesaid subjects of intellectual property rights and technology transfer\r\n(including re-transfer).
8. Incomes from franchise
Franchise is a commercial\r\noperation in which the franchiser allows and requests the franchisee to sell\r\ngoods and services under the conditions set out by the franchiser in the\r\nfranchise contract.
Incomes from franchise\r\nare incomes that the person earned from the aforesaid franchise contracts,\r\nincluding re-franchise according to regulations of law on franchise.
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Incomes from inheritance\r\nare incomes that the person receives under a will or in accordance with\r\nregulations of law on inheritance. To be specific:
a) Inherited securities:\r\nshares, call options on shares, bonds, treasury bills, fund certificates, and\r\nother securities according to the Law on Securities; shares of the person in\r\nthe joint-stock company according to the Law on Enterprises.
b) Inherited capital in\r\neconomic organizations and business establishments: capital contribution to\r\nlimited liability companies, cooperatives, partnerships, business cooperation\r\ncontracts; capital in private enterprises and business establishment of the\r\nperson; capital in associations and funds established within the law, or the\r\nentire business establishment in case the private enterprise or business\r\nestablishment is under the ownership of the person.
c) Inherited real estate:\r\nrights to use land, rights to use land and property thereon; ownership of\r\nhouses, including off-the-plan houses, infrastructure and constructions on\r\nland, including off-the-plan constructions; rights to rent land or water\r\nsurface; other incomes from inheritance being real estate in any shape or form,\r\nexcept for incomes from the inherited real estate mentioned in Point d Clause 1\r\nArticle 3 of this Circular.
d) The ownership and\r\nright to use other inherited assets (cars, motorbikes, ships, barges,\r\nspeedboats, towboats, yachts, airplanes, hunting guns, and sporting guns) shall\r\nbe registered with state agencies.
10. Incomes from receipt\r\nof gifts
Incomes from receipt of\r\ngifts are incomes that the person receives from organizations and individuals\r\nat home and overseas. To be specific:
a) Gifts being securities:\r\nshares, call options on shares, bonds, treasury bills, fund certificates, and\r\nother securities according to the Law on Securities; shares of the person in\r\nthe joint-stock company according to the Law on Enterprises.
b) Gifts being capital in\r\neconomic organizations and business establishments: capital contribution to\r\nlimited liability companies, cooperatives, partnerships, business cooperation\r\ncontracts; capital in private enterprises and business establishments of the\r\nperson; capital in associations and funds established within the law, or the\r\nentire business establishment in case the private enterprise or business\r\nestablishment is under the ownership of the person.
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d) The ownership of and\r\nright to use gifts being other assets (cars, motorbikes, ships, barges,\r\nspeedboats, towboats, yachts, airplanes, hunting guns, sporting guns) shall be\r\nregistered with state agencies.
Article\r\n3. Tax-free incomes
1. According to Article 4\r\nof the Law on Personal Income Tax and Article 4 of the Decree No.\r\n65/2013/ND-CP, tax-free incomes include:
a) Incomes from real\r\nestate transfer (including off-the-plan houses and constructions according to\r\nregulations of law on real estate trading) between husband and wife, parents\r\nand children; adoptive parents and adopted children; parents-in-law and\r\nchildren-in-law; grandparents and grand children, and among siblings.
The real estate\r\n(including off-the-plan houses and constructions according to regulations of\r\nlaw on real estate trading) that is established by either spouse during the\r\nmarriage, considered marital property, divided under agreements or judgment of\r\nthe court when they divorce shall be tax-free.
b) Income from transfer\r\nof a person's only house or right to use residential land and property thereon\r\nin Vietnam.
b.1) The person that\r\ntransfers the house and right to use land that are tax-free as prescribed in\r\nPoint b Clause 1 of this Article must meet all conditions below:
b.1.1) The transferor\r\nowns only one house or right to use residential land plot (with or without\r\nproperty thereon) at the time of transfer. To be specific:
b.1.1.1) The house ownership\r\nand right to use land shall be determined based on the certificate of rights to\r\nuse land, ownership of house and other property on land.
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b.1.1.3) If the house\r\nownership or right to use land is the marital property and only property of the\r\nhusband and wife, the person that has no other private house or land is\r\neligible for tax exemption, the person that has another private house or land\r\nis not eligible for tax exemption.
b.1.2) 15 The house\r\nownership or land use right has been possessed for at least 183 days before it\r\nis transferred.
The time for\r\ndetermination of the house ownership or land use right is the date of issuance\r\nof the certificate of land use right, ownership of house and other property on\r\nland. In case the certificate is reissued or replaced under regulations of law\r\nland, the time for determination of the house ownership or land use right is\r\nthe date of issuance of the certificate of land use right, ownership of house\r\nand other property on land before reissuance or replacement”
b.1.3) The entire house\r\nor residential land is transferred.
If the individual has or\r\nshares the ownership of the only house or land use right and transfers part of\r\nit, the transferred part is not tax-free.
b.2) The only house and\r\nresidential land that is tax-free shall be declared by the person and he/she\r\nshall be responsible for such declaration. If false declaration is discovered,\r\nthe person has to pay tax arrears and incur penalties for violations against\r\nthe laws on tax administration.
b.3) Transfer of\r\noff-the-plan houses and constructions that are not exempt from personal income\r\ntax shall follow guidance according to Point b Clause 1 of this Article.
c) Incomes from the\r\nperson’s rights to use land allocated by the State that is eligible for land\r\nlevy exemption or reduction.
The person that transfers\r\nthe area of land eligible for exemption or reduction in land levy shall declare\r\nand pay tax on the income from real estate transfer according to Article 12 of\r\nthis Circular.
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dd) Incomes from\r\nconversion of agricultural land, which is allocated by the State for\r\nrationalization of agricultural production without change in land use purposes\r\nof the household or person engaged in agricultural production.
e) Incomes of households\r\nand persons engaged in agriculture, forestry, salt production and fishery with\r\nfishery products that have not yet been processed or have been preliminarily\r\nprocessed and have not yet been processed into other products.
Each household/person\r\nengaged in production according to guidance in this Point shall:
e.1) Have legitimate\r\nrights to use, lease land and water surface to engage in agriculture, forestry,\r\nsalt production, and fishery.
Present a lease contract\r\nif the land or water surface is leased from another organization or person\r\n(unless the household or person is assigned to plant, take care of, manage, and\r\nprotect forests by forestry companies). The household or person that does fishing\r\nshall have the Certificate of ownership of ships or contract to rent ships used\r\nfor fishing and direct participation in fishing (except for fishing by trawling\r\nnets and other methods of fishery prohibited by law).
e.2) Reside in the local\r\narea where the agriculture, forestry, salt production or fishery takes place.
The aforesaid local area\r\nis a district, town, or city affiliated to a province (hereinafter referred to\r\nas “district”), or a district adjacent to the area where the production takes\r\nplace.
Incomes from fishing do\r\nnot depend on residence.
e.3) Raw agriculture,\r\nforestry products, salt, and fishery products which have not yet been processed\r\ninto other products or have been preliminarily processed are products that are\r\njust cleaned, dried, husked, cut, salted, frozen, and put into ordinary\r\nstorage.
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g.1) The tax-free\r\ninterest on deposits mentioned in this Point is the income from the interest on\r\ndeposits in VND, gold, or foreign currencies at credit institutions and\r\nbranches of foreign banks established and operating in accordance with the Law\r\non Credit Institutions in the form of demand deposits, term deposits, savings,\r\ncertificates of deposit, promissory notes, treasury bills, and other forms of\r\ndeposits that the depositor should receive both principal and interest.
Bases for identification\r\nof tax-free incomes from deposits are the saving book (or saving card),\r\ncertificates of deposit, exchange bills, treasury bills, and other papers that\r\nthe depositor should receive both principal and interest.
g.2) Interest on life\r\ninsurance contract is the interest that the person receives under the life\r\ninsurance contract with the insurer.
The basis for\r\nidentification of tax-free income from interest on life insurance contract is\r\nthe note of interest payment from the insurance contract.
g.3) Interest on\r\nGovernment bonds is the interest that the person receives from purchase of\r\nGovernment bonds issued by the Ministry of Finance.
Bases for identification\r\nof tax-free income from interest on Government bonds are face values, interest\r\nrates, and terms on the Government bonds.
h)
In case a person\r\nreceives a remittance from a foreign relative from abroad in accordance with\r\nregulations on encouragement of remittance of money from abroad to Vietnam of\r\nthe State Bank of Vietnam, it will be exempt from tax as prescribed in this\r\nPoint.
Bases for\r\nidentification of tax-free incomes mentioned in this Point are papers proving\r\nthat those amounts are sent from abroad and payment notes issued by the\r\nmoney-transferring organization (if any).
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i.1) Tax-free additional\r\npayments for working at night or working overtime shall be identified according\r\nto the actual total payment for working at night or overtime minus (-) the\r\npayment for an ordinary working day.
Example 2: The wage of\r\nMr. A on an ordinary working day is 40.000 VND/hour.
- When working overtime\r\non a working day, he is paid 60.000 VND/hour, thus the tax-free income is:
60.000 VND/hour – 40.000\r\nVND/ hour = 20.000 VND/ hour
- When working overtime\r\non a holiday, he is paid 80.000 VND/hour, thus the tax-free income is:
80.000 VND/hour – 40.000\r\nVND/ hour = 40.000 VND/ hour
i.2) The organization or\r\nperson that pays incomes (hereinafter referred to as income payer) shall make a\r\ntable specifying the hours of night work, extra hours, additional payments for working\r\nat nights and overtime. This table shall be kept and presented by the income\r\npayer at the request of the tax authority.
k) Pensions paid by\r\nSocial Insurance Fund according to the Law on Social Insurance; monthly\r\npensions from the voluntary pension fund.
Pensions paid from abroad\r\nto the people living and working in Vietnam are tax-free.
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m.1) Scholarships funded\r\nby government budget, including scholarships given by the Ministry of Education\r\nand Training, Services of Education and Training, public schools, and other\r\nscholarships funded by government budget.
m.2) Scholarships given\r\nby Vietnamese and foreign organizations (including payment for living\r\nexpenses).
The scholarship giver\r\nshall keep the decisions to give scholarships and notes of scholarship\r\npayments. Where the person directly receives scholarships from foreign\r\norganizations, the person shall keep the documents proving the incomes from\r\nsuch scholarships.
n)
n.1) Incomes from\r\nindemnities under the contract for life insurance, non-life insurance, or\r\nhealth insurance are the money that the life insurer, non-life insurer, or health\r\ninsurer pays for the policyholders according to the concluded insurance\r\ncontracts Bases for identification of such indemnity are the written decision\r\non indemnity made by the insurer or the court and notes of indemnity payment.
n.2) The income from the\r\ncompensation for an occupational accident is the money that the employee\r\nreceives from his or her employer or the social insurance fund after suffering\r\nfrom an accident at work. Bases for identification of such compensation are the\r\nwritten decision on compensation made by the employer or the court and notes of\r\ncompensation payment.
n.3) Incomes from\r\ncompensations and supports according to law regulations on compensation,\r\nsupport, and relocation are compensations and supports provided by the State\r\nwhen withdrawing land, including incomes from the compensations and supports\r\nprovided by economic organizations as prescribed.
Bases for\r\nidentification of incomes from aforesaid compensations and supports are\r\ndecisions on land withdrawal, compensations, and relocation issued by competent\r\nauthorities, and notes of compensation payment.
n.4) Incomes from\r\ncompensations provided by the State and other compensations prescribed by\r\nregulations of law on compensations provided by the State are compensations for\r\nthe wrongful decisions on penalties for administrative violations made by\r\ncompetent persons or competent authorities which infringe the interests of the\r\nperson; incomes from compensation for the miscarriage of justice during\r\ncriminal proceedings. Bases for identification of such compensations are the\r\ndecision made by the competent authority which forces the organization or\r\nindividual making the wrongful decision to provide compensations and notes of\r\ncompensation payment.
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p) Incomes from\r\nnon-profit charitable trusts accredited by competent authorities, which aim for\r\ncharity, humanitarianism, and study encouragement.
These charitable trusts\r\nmust be established and operate in accordance with the Government's Decree No.\r\n30/2012/ND-CP dated April 12, 2012 on organization and operation of social\r\ntrusts and charitable trusts.
Bases for identification\r\nof tax-free incomes from such charitable trusts in this Point are written\r\ndecisions on giving money and notes of support in cash or in kind made by the\r\ncharitable trusts.
q) Incomes from foreign\r\naids for charitable and humanitarian purposes, whether governmental or\r\nnon-governmental, that are approved by competent authorities.
The basis for\r\nidentification of the tax-free income in this Point is written approval for\r\nreceipt of aids made by the competent authority.
r)
s) 19 Incomes of\r\nindividuals being ship owners or individuals having rights to use the ships\r\nfrom provision of goods/services directly serving offshore fishing.
2. The procedure and\r\napplication for tax exemption in the cases in Points a, b, c, d, dd Clause 1 of\r\nthis Article shall comply with guiding documents on tax administration.
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1. Determination of\r\nreduced tax:
a) Tax reduction shall be\r\nconsidered in the tax year. The taxpayer shall receive tax reduction for the\r\ntax year in which the taxpayer suffers from natural disaster, fire, accident,\r\nor fatal disease.
b) The tax payable used for\r\ncalculating tax reduction is the total personal income tax payable in the tax\r\nyear, including:
b.1) Paid or deducted\r\npersonal income tax on incomes from capital investment, incomes from capital\r\ntransfer, incomes from real estate transfer, incomes from winning prizes,\r\nincomes from royalties, incomes from franchise, incomes from inheritance, and\r\nincomes from gifts.
b.2) Personal income tax\r\npayable on incomes from business and incomes from wages, remunerations.
c) The basis for\r\ncalculation of the damage eligible for tax reduction is the total expenditure\r\nfor repairing damage minus the indemnities provided by insurers (if any) or\r\ncompensations provided by the organization or individual that caused the\r\naccident (if any).
d) The reduced tax is\r\ndetermined as follows:
d.1) If the tax payable\r\nin the tax year is higher than the damage level, the reduced tax is equal to\r\nthe damage level.
d.2) If the tax payable\r\nin the tax year is lower than the damage level, the reduced tax is equal to the\r\ntax payable.
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Article\r\n5. Converting taxable income into VND
1. Revenues and\r\nincomes subject to PIT are expressed as VND.
Revenues and taxable incomes\r\nreceived in foreign currencies shall be converted into VND at the buying rate\r\nof the bank where the person opens the transaction account at the time incomes\r\nare earned.
In case a taxpayer\r\ndoes not have a transaction account in Vietnam, foreign currencies shall be\r\nconverted into VND at the buying rate of Vietcombank at the time incomes are\r\nearned.
Foreign currencies\r\nwithout rates of exchange into VND shall be converted into a foreign currency\r\nthat has a rate of exchange into VND.
2. Non-cash taxable incomes\r\nshall be converted into VND at the market prices of such products/services or\r\nthe similar products/services when the incomes are earned.
1. Regarding residents:
a) Annual tax statement\r\nis applicable to incomes from business and incomes from wages, remunerations.
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If the person has been\r\npresent in Vietnam for fewer than 183 days in a calendar year, but has been in\r\nVietnam for 183 days for 12 consecutive months from the date of arrival, the\r\nfirst tax period is the 12 consecutive months from the date of arrival. In the\r\nsecond year, the tax period is the calendar year.
Example 3: Mr. B is a\r\nforeigner who first comes to Vietnam on April 20, 2014. In 2014 up to December\r\n31, Mr. B has stayed in Vietnam for 130 days. In 2015 up to April 19, Mr. B has\r\nstayed in Vietnam for 65 days. The first tax period of Mr. B begins on April\r\n20, 2014 and ends on April 19, 2015. The second tax period begins on January\r\n01, 2015 and ends on December 31, 2015.
b) Tax statement when an\r\nincome is earned is applicable to incomes from capital investment, incomes from\r\ncapital transfer, incomes from real estate transfer, incomes from winning\r\nprizes, incomes from royalties, incomes from franchising, incomes from\r\ninheritance, and incomes from gifts.
c) Tax on incomes from\r\ntransfer of securities shall be declared annually or when it is incurred.
2. Regarding\r\nnon-residents:
Each non-resident shall\r\ndeclare tax whenever an income is earned.
Where the business person\r\ndoes not have a fixed business location such as a shop or counter, the tax\r\nperiod is similar to that applicable to the resident earning income from\r\nbusiness.
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Bases for calculation of\r\ntax on incomes from 22 wages are the assessable income and tax rate. To be\r\nspecific:
1. Assessable income\r\nequals taxable income according to guidance in Article 8 of this Circular minus\r\n(-) the following deductions:
a) Personal deductions\r\naccording to guidance in Clause 1 Article 9 of this Circular.
b) Insurance premiums and\r\npayment to the voluntary pension fund according to guidance in Clause 2 Article\r\n9 of this Circular.
c) Charitable,\r\nhumanitarian, and study encouragement contributions (hereinafter referred to as\r\ncharitable donations) according to guidance in Clause 3 Article 9 of this\r\nCircular.
2. Tax rate
The rate of personal\r\nincome tax on incomes from 23 wages shall apply the progressive tax table in\r\nArticle 22 of the Law on Personal Income Tax. To be specific:
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Up to 60
Up to 5
Over 60 to 120
Over 5 to 10
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Over 120 to 216
Over 10 to 18
Over 216 to 384
Over 18 to 32
Over 384 to 624
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Over 624 to 960
Over 52 to 80
Over 960
Over 80
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Personal income tax on incomes\r\nfrom 24 wages is the total tax on each level of income. The tax on each level\r\nof income equals the assessable income of that level multiplied by (x) the\r\ncorresponding tax rate of that level.
For convenience, the\r\nabridged method in Appendix 01/PL-TNCN to this Circular may be applied.
Example 4: Mrs. C earns\r\nan income of 40 million VND from wages in the month, and pay 7% of wages for\r\nsocial insurance premium, 1.5% of wages for health insurance premium. Mrs. C\r\nhas 2 children under the age of 18, and makes no charitable donations. The\r\npreliminary personal income tax incurred by Mrs. C in the month is calculated\r\nas follows:
- Taxable income of Mrs.\r\nC is 40 million VND.
- Mrs. C is eligible for\r\nthe deductions below:
+ Personal deduction: 9\r\nmillion VND
+ Deductions for 02\r\ndependants (02 children):
3.6 million VND x 2 = 7.2\r\nmillion VND
+ Social insurance,\r\nhealth insurance:
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Total deduction:
9 million VND + 7,2\r\nmillion VND + 3,4 million VND = 19, 6 million VND
- Assessable income of\r\nMrs. C:
40 million VND – 19,6\r\nmillion VND = 20,4 million VND
- Tax payable:
Method 1: using the\r\nprogressive tax table:
+ Level 1: assessable\r\nincome up to 5 million VND, 5% tax:
5 million VND x 5% = 0,25\r\nmillion VND
+ Level 2: assessable\r\nincome from over 5 million VND to 10 million VND, 10% tax:
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+ Level 3: assessable\r\nincome from over 10 million VND to 18 million VND, 15% tax:
(18 million VND -\r\n10 million VND) x 15% = 1,2 million VND
+ Level 4: assessable\r\nincome from over 18 million VND to 32 million VND, 20% tax:
(20,4 million VND -\r\n18 million VND) x 20% = 0,48 million VND
- Total preliminary tax\r\npayable by Mrs. C in the month:
0,25 million VND + 0,5\r\nmillion VND + 1,2 million VND + 0,48 million VND = 2,43 million VND
Method 2: Using the\r\nabridged method:
The assessable income in\r\nthe month 20,4 million VND is the assessable income in level 4. The personal\r\nincome tax payable:
20,4 million VND x 20% -\r\n1,65 million VND = 2,43 million VND
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If the wages paid to the\r\nemployee according to guidance in Clause 2 Article 2 of this Circular are\r\nexclusive of tax, they must be converted into assessable income in accordance\r\nwith Appendix No. 02/PL-TNCN to this Circular. To be specific:
a)
Formula for\r\ncalculation of converted income:
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Where:
- Actual income is the\r\ntax-exclusive wage that the employee receives every month (exclusive of\r\ntax-free income).
- The amounts paid on\r\nthe employee’s behalf are the benefits in cash or in kind paid to the employee\r\nby the employer as instructed in Point dd Clause 2 Article 2 of Circular No.\r\n111/2013/TT-BTC, Clause 2, Clause 3 and Clause 4 Article 11 of Circular No.\r\n92/2015/TT-BTC.
- Deductions include\r\npersonal deductions, insurance premiums, contributions to the voluntary pension\r\nfund, and charitable donations according to guidance in Article 9 of Circular\r\nNo. 111/2013/TT-BTC and Circular No. 92/2015/TT-BTC.
b) If the person is\r\nrequired to settle tax, the taxable income in the year is the sum of taxable\r\nincome of each month based on the converted assessable income. If the person earns\r\ntax-exclusive incomes from multiple organizations, the taxable income in the\r\nyear is the sum of taxable income of each month paid by each organization in\r\nthe year.
Example 7. Mr. D in\r\nexample 6 above has a contract and earns an income of 12 million VND/month at\r\ncompany Y from January 2014 to May 2014 apart from the income earned at company\r\nX Company Y also pays personal income tax on behalf of Mr. D.
Final personal income tax\r\nincurred by Mr. D in 2014:
- Taxable income in the\r\nyear earned by Mr. D at company X:
42,687 million VND x 12\r\nmonths = 512,244 million VND
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+ Monthly assessable\r\nincome (converted in accordance with Appendix No. 02/PL-TNCN):
(12 million VND -\r\n0,75 million VND) /0,85 = 13,235 million VND
+ Taxable income in the\r\nyear earned at company Y:
13,235 million VND x 5\r\nmonths = 66,175 million VND
+ Total taxable income\r\nearned by Mr. D in 2014:
512,244 million VND +\r\n66,175 million VND = 578,419 million VND
- Monthly assessable\r\nincome:
(578,419 million VND\r\n: 12 months) - (9 million VND + 1,5 million VND) = 37, 702 million VND
- Personal income tax\r\npayable in the year:
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5. 26. (Annulled)
6. 27 The basis for\r\ncalculation of tax on accrued premiums of optional insurances is the accrued\r\npremiums of life insurance (except voluntary pension insurance) and other\r\noptional insurances paid by the employer on behalf of the employee with the\r\ndeduction rate of 10%.
In case the employer\r\nbuys life insurance (except voluntary pension insurance) and/or other optional\r\ninsurances with accrual of insurance premiums for the employee from the\r\ninsurer(s) established and operating under Vietnam’s law, the employee is not\r\nrequired to include the accrued premiums to taxable income when the employer\r\nbuys the insurance(s). When the contract matures, the insurer shall deduct 10%\r\ntax from the accrual of premiums paid by the employer for the employee from\r\nJuly 01, 2013. In case the premium accrual is paid by installments, 10% tax\r\nshall be deducted from each payment.
In case the employer\r\nbuys life insurance (except voluntary pension insurance) and/or other optional\r\ninsurances with accrual of insurance premiums for the employee from the\r\ninsurer(s) not established and operating under Vietnam’s law, the employer has\r\nthe responsibility to deduct 10% tax from the premiums before paying the\r\nemployee.
Insurers shall be\r\nresponsible for monitoring premiums of life insurance and other optional\r\ninsurances bought by employers for their employees in order to calculate PIT.”
Article\r\n8. Calculation of taxable incomes from wages
1. 29 (Annulled)
2. Taxable income from\r\nwages
a) The taxable income\r\nfrom wages equals the sum of wages, remunerations and other incomes considered\r\nas wages received by the taxpayer in the tax period according to guidance in\r\nClause 2 Article 2 of this Circular.
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Taxable income from wages\r\nand remuneration shall be calculated when the income is paid to the taxpayer.
The taxable income from\r\naccrued insurance premium guided in Point dd.2 Clause 2 Article 2 of this\r\nCircular shall be calculated when the insurer 30 pays the insurance money.
33. 31 (Annulled)
Deductions under guidance\r\nin this Article are amounts deducted from the taxable income of the person\r\nbefore the taxable income from wages is calculated 32. To be specific:
1. Personal deductions
According to Article 19\r\nof the Law on Personal Income Tax, Clause 4 Article 1 of the Law on amendments\r\nto the Law on Personal Income Tax, and Article 12 of the Decree No.\r\n65/2013/ND-CP:
a) Personal deduction is\r\nthe amount of money deducted from the taxable income before calculation of tax\r\non the income from wages 33 earned by the resident taxpayer.
…34
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b.1) Deduction for the\r\ntaxpayer: 9 million VND/month, 108 million VND/year.
b.2) Deduction for each\r\ndependant: 3,6 million VND/month
c) Principles of\r\ncalculating deductions
c.1) Personal deduction\r\nfor the taxpayer:
c.1.1) The taxpayer that\r\nhas multiple sources of income from wages 35 shall calculate the personal\r\ndeduction for himself/herself in a place at a time (considered a full month).
c.1.2) The foreigner being\r\na resident in Vietnam shall make personal deduction from January (or the month\r\nof arrival if the person comes to Vietnam for the first time) until the month\r\nin which the labor contract expires and that person leaves Vietnam in the tax\r\nyear (considered a full month).
Example 8: Mr. E is a\r\nforeigner that comes to work in Vietnam continuously from March 01, 2014. On\r\nNovember 15, 2014, the labor contract expires and Mr. E goes home. Mr. E is\r\npresent in Vietnam for 183 days from March 01, 2014 until the date of\r\ndeparture. Thus in 2014, Mr. E is a resident and may make a personal deduction\r\nfrom January until the end of November 2014.
Example 9: Mrs. G is a\r\nforeigner who comes to Vietnam for the first time on September 21, 2013. On\r\nJune 15, 2014, the labor contract expires and Mrs. G leaves Vietnam. Mrs. G is\r\npresent in Vietnam for 187 days during the period from September 21, 2013 to\r\nJune 15, 2014. Thus in the first tax year (from September 21, 2013 to September\r\n20, 2014), Mrs. G is considered a resident in Vietnam and may make a personal\r\ndeduction from September 2013 until the end of June 2014.
c.1.3) If the person has\r\nnot made personal deduction or the deduction does not cover 12 months in the\r\ntax year, the person may make deduction for 12 months before settling tax\r\naccording to regulations.
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c.2.1) The taxpayer may\r\nmake deductions for his or her dependants if the taxpayer has applied for tax\r\nregistration and been issued with the tax identification number.
c.2.2) When registering\r\ndeductions for dependants, the taxpayer shall be issued with tax identification\r\nnumbers for dependants by the tax authority and make preliminary deductions in\r\nthe year from the registration date Dependants that are registered before the\r\neffective date of this Circular are still eligible for deductions until they\r\nare issued with tax identification numbers.
c.2.3) If the taxpayer\r\nhas not made deductions for dependants in the tax year, the deductions for\r\ndependants shall be made from the month in which the custody is given when the\r\ntaxpayer settles tax and registers deductions for dependants. Deductions for\r\nother dependants, who are defined in Point d.4 Clause 1 of this Article, shall\r\nbe registered by December 31 of the tax year, otherwise the deduction for the\r\nwhole tax year shall not be made.
c.2.4) The deduction for\r\na dependant shall apply to only one taxpayer in the tax year. Where multiple\r\ntaxpayers have the same dependant, they shall reach an agreement on the person\r\nthat makes the deduction for such dependant.
d) Dependants include:
d.1) Children, legitimate\r\nadopted children, illegitimate children, stepchildren. To be specific:
d.1.1) Children under 18\r\nyears of age.
Example 10: A child of\r\nMr. H born on July 25, 2014 is considered a dependant from July 2014.
d.1.2) Children from 18\r\nyears of age and over that are disabled and incapable of work.
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d.2) Taxpayer's spouse\r\nthat meets the conditions in Point dd Clause 1 of this Article.
d.3) Taxpayer’s parents,\r\nparents-in-law, stepparents, legitimate adoptive parents that meet the\r\nconditions in Point dd Clause 1 of this Article.
d.4) Other dependants that\r\nthe taxpayer has to provide for, who meet the conditions in Point dd Clause 1\r\nof this Article, including:
d.4.1) Taxpayer’s\r\nbrothers and sisters.
d.4.2) Taxpayer’s\r\ngrandparents, aunts, uncles.
d.4.3) Taxpayer’s nieces\r\nand nephews.
d.4.4) Other people as\r\nprescribed by law.
dd) A person that meets\r\nthe conditions below shall be considered a dependant mentioned in Point d.2,\r\nd.3, d.4 Clause 1 of this Article:
dd.1) The person of\r\nworking age shall meet all conditions below:
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dd.1.2) The person has no\r\nincome or his average monthly income from all sources does not exceed 1.000.000\r\nVND.
dd.2) The people outside\r\nworking age shall have no income or their average monthly income from all\r\nsources shall not exceed 1.000.000 VND.
e) The disabled that are\r\nincapable of work mentioned in Point dd.1.1 Clause 1of this Article are people\r\nregulated by regulations of law on the disabled and ill people incapable of\r\nworks (sufferers from AIDS, cancer, chronic kidney failure, etc.)
g) Documents proving\r\ndependants
g.1) Children:
g.1.1) For children under\r\n18 years of age: photocopies of the Certificates of birth and ID cards (if\r\nany).
g.1.2) For children from\r\n18 years of age and over that are disabled and incapable of work:
g.1.2.1) Photocopies of\r\nthe Certificates of birth and ID cards (if any).
g.1.2.2) Photocopies of\r\nCertificates of disability according to regulations of law on the disabled.
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g.1.3.1) Photocopies of\r\nthe Certificates of birth.
g.1.3.2) Photocopies of\r\nstudents’ cards or declarations certified by the schools, or other papers\r\nproving the study at such schools.
g.1.4) For adopted\r\nchildren, illegitimate children, stepchildren: apart from the aforesaid papers,\r\nother papers proving the relationship are required, such as photocopies of\r\ndecisions on certification of adoption made by competent authorities.
g.2) For spouse:
- A photocopy of the ID\r\ncard
- A photocopy of the\r\nhousehold book (which proves the husband and wife relationship) or a photocopy\r\nof the Certificate of marriage.
If the spouse is of\r\nworking age, other papers proving the dependant’s incapability of work are\r\nrequired, apart from the aforesaid papers, such as the Certificate of\r\ndisability according to regulations of law on the disabled that are incapable\r\nof works, a photocopy of the medical record of the ill person incapable of work\r\n(sufferer from AIDS, cancer, chronic kidney failure, etc.)
g.3) For parents,\r\nparents-in-law, stepparents, legitimate adoptive parents:
- Photocopies of ID\r\ncards.
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If they are of working\r\nage, other papers proving the dependants’ incapability of work are required,\r\napart from the aforesaid papers, such as Certificates of disability according\r\nto regulations of law on the disabled that are incapable of works, photocopies\r\nof the medical records of ill persons incapable of work (sufferers from AIDS,\r\ncancer, chronic kidney failure, etc.).
g.4) For other people\r\nmentioned in Point d.4 Clause 1 of this Article, proving documents include:
g.4.1) Photocopies of\r\nCertificates of birth or ID cards.
g.4.2) Other legitimate\r\npapers for determination of the custody as prescribed by law.
If the dependants are of\r\nworking age, other papers proving dependants’ incapability of work are\r\nrequired, apart from the aforesaid papers, such as the Certificate of\r\ndisability according to regulations of law on the disabled that are incapable\r\nof works, photocopies of medical records of ill persons incapable of work\r\n(sufferers from AIDS, cancer, chronic kidney failure, etc.).
Legitimate papers\r\nmentioned in Point g.4.2 Clause 1 of this Article are any legal document that\r\nproves the relationship between the taxpayer and the dependant, including:
- Photocopies of papers\r\nproving the custody (if any).
- A photocopy of the\r\nhousehold book (if their names are in the same household book).
- A photocopy of the\r\ncertificate of temporary residence of the dependent (if their names are not in\r\nthe same household book).
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- A declaration that the\r\ndependant is residing in the commune and living alone, which is made by the\r\ntaxpayer according to the form provided in documents on tax administration and\r\ncertified by the People’s Committee of the commune where the taxpayer resides.
g.5) If the resident is a\r\nforeigner, legal documents proving the dependant, which are equivalent to the\r\naforesaid documents are required.
g.6) Where the taxpayer\r\nworking in an economic organization, a public service provider has specified\r\nhis/her dependants being his/her parents, spouse, children, and other\r\ndependants in his or her résumé, the documents proving the dependants are the\r\ndocuments mentioned in Point g.1, g.2, g.3, g.4, g.5 Clause 1 of this Article,\r\nor only the dependant registration form certified by the head of the unit on\r\nthe left is required.
The head of the unit is\r\nonly responsible for full names of dependants, their years of birth and\r\nrelationship with the taxpayer. The taxpayer is responsible for other\r\ninformation.
h) Declaration of\r\ndeduction for dependants
h.1) The taxpayer that\r\nearns 09 million VND/month or less from wages 36 is not required to register\r\ndependants.
h.2) The taxpayer that\r\nearns over 09 million VND/month from wages 37 shall follow the procedure below\r\nto make deductions for dependants:
h.2.1) For taxpayers that\r\nearn incomes from wages
h.2.1.1) Registration of\r\ndependants
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The taxpayer that earns\r\nincome from wages shall submit 02 applications for dependant registration (using\r\nthe form provided in guiding documents on tax administration) to the income\r\npayer as the basis for calculation of deductions for dependants.
The income payer shall\r\nkeep 01 application and submit 01 application to the local tax authority when\r\nsubmitting the personal income tax declaration of that person in accordance\r\nwith the Law on Tax Administration.
The person that directly\r\ndeclares tax at the tax authority shall submit 01 application for dependant\r\nregistration (using the form provided in guiding documents on tax\r\nadministration) to the tax authority that monitors the income payer when\r\nsubmitting his declaration of personal income tax in accordance with the Law on\r\nTax Administration.
h.2.1.1.2) Registration\r\nin case of changes of dependants:
When the number of\r\ndependants are changed (increased or decreased), the taxpayer shall make an\r\nadditional declaration using the form provided in guiding documents on tax\r\nadministration, and submit it to the income payer (or to the tax authority if\r\nthe taxpayer declares tax directly at the tax authority).
h.2.1.2) Location and\r\ndeadline for submission of documents proving the dependants:
- The location for\r\nsubmission of documents proving the dependants is a place where the taxpayer\r\nsubmits the application for dependant registration
The income payer shall\r\nkeep the documents proving the dependants and present them when the tax\r\nauthority carries out tax inspection.
- The documents proving\r\nthe dependants shall be submitted within 03 months from the day on which the\r\napplication for dependant registration is submitted (including the registration\r\nof change of dependants).
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h.2.2) 38\r\n(Annulled)
i) The taxpayer shall\r\nregister and submit proving documents for a dependant once throughout the\r\ndeduction period. Where the taxpayer changes the workplace 39, the application\r\nfor dependant registration and proving documents shall be similarly submitted\r\naccording to guidance in Point h.2.1.1.1 Clause 1 of this Article.
2. Deductions for\r\ninsurance premiums and contributions to the voluntary pension fund
a) Insurance premiums\r\ninclude premiums for social insurance, health insurance, unemployment insurance\r\nand professional liability insurance which is compulsory for some professions.
b)
Contributions to the\r\nvoluntary pension fund and payment for voluntary pension insurance are deducted\r\nfrom the taxable income. Nevertheless, the deduction shall not exceed VND 01\r\nmillion/month if the employee participates in voluntary pension products as\r\ninstructed by the Ministry of Finance, including the amounts paid by the\r\nemployer on behalf of the employee and the amounts paid by the employee\r\nhimself/herself, even if the employee participates in multiple pension funds.\r\nThe basis for determination of deductible income is a photocopy of receipt for\r\npayments issued by the voluntary pension fund or the insurer.
c) Where the foreigner\r\nbeing a resident in Vietnam, or the Vietnamese person being a resident but\r\nworking overseas earns incomes from wages 41 overseas and pays compulsory\r\ninsurance premiums required by the country where the person holds the\r\nnationality or works that are similar to those in Vietnam such as social\r\ninsurance, health insurance, unemployment insurance, professional liability\r\ninsurance, and other compulsory insurance, such insurance premiums may be\r\ndeducted from the taxable income from wages 42 when the personal income tax is\r\ncalculated.
Foreigners and Vietnamese\r\npeople who pay the aforesaid insurance premiums overseas shall have them\r\nprovisionally deducted from the income in the year (if supporting documents are\r\nprovided). Deductions shall be officially made when they settle tax according\r\nto regulations. If no supporting documents are provided for immediate\r\ndeduction, a lump-sum deduction shall be made when settling tax.
d) Insurance premiums and\r\ncontributions to the voluntary pension fund in the year shall be deducted from\r\nthe taxable income earned in that year.
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3. Deductible charitable\r\ndonations.
a) Charitable donations\r\nshall be deducted from the taxable income from wages 43 before the tax incurred\r\nby a resident taxpayer is calculated. To be specific:
a.1) Donations to the\r\nestablishments that take care of disadvantaged children, the disabled, and the\r\nhomeless elderly people.
Establishments that take care\r\nof disadvantaged children, the disabled, and the homeless elderly people shall\r\nbe established and operate in accordance with the Government's Decree No.\r\n68/2008/ND-CP dated May 30, 2008 on conditions and procedure for establishment,\r\norganization, operation, and dissolution of social protection organizations,\r\nthe Government's Decree No. 81/2012/ND-CP dated October 08, 2012 on amendments\r\nto the Government's Decree No. 68/2008/ND-CP dated May 30, 2008 on conditions\r\nand procedure for establishment, organization, operation, and dissolution of\r\nsocial protection organizations, and the Government's Decree No. 109/2002/ND-CP\r\ndated December 27, 2002 on amendments to the Government's Decree No. 195/CP\r\ndated December 31, 1994 on elaboration and provision of guidance on the\r\nimplementation of a number of Articles the Labor Code on hours for work and\r\nrest.
Documents proving the\r\ndonations to the establishments that take care of disadvantaged children, the\r\ndisabled, and the homeless elderly people are valid notes of receipts of such\r\nestablishments.
a.2) Contributions to\r\ncharitable, humanitarian and study encouragement funds established and\r\noperating in accordance with the Government's Decree No. 30/2012/ND-CP dated\r\nApril 12, 2012 on the organization and operation of non-profit social funds,\r\ncharitable funds, and other documents related to the management and use of\r\nsponsorships.
Documents proving\r\ncharitable donations are valid notes of receipt made by central or provincial\r\norganizations and funds.
b) Charitable donations\r\nmade in a tax year shall be deducted from the taxable income earned in that tax\r\nyear. The donations that are not completely deducted shall be deducted from the\r\ntaxable income earned in the next tax year. The maximum deduction shall not\r\nexceed the assessable income from wages 44 earned in the tax year in which the\r\ncharitable donations are made.
Article\r\n10. Bases for calculation of tax on incomes from capital investment.
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1. Assessable income
The assessable income\r\nfrom capital investment is the taxable income earned by the individual\r\naccording to Clause 3 Article 2 of this Circular.
2. The tax rate on the\r\nincome from capital investment is 5% according to the whole income tax table.
3. Time to calculate the\r\nassessable income
The assessable income\r\nfrom capital investment shall be calculated when the taxpayer is paid by the\r\nincome payer.
Times to calculate\r\nassessable income in some cases:
a) The income from additional\r\nvalue of capital contribution according to guidance in Point d Clause 3 Article\r\n2 of this Circular shall be calculated when the person actually receives the\r\nincome in case when the enterprise is dissolved, converted, divided, merged,\r\namalgamated, or when the capital is withdrawn.
b) The income from\r\nreinvested profit according to guidance in Point g Clause 3 Article 2 of this\r\nCircular shall be calculated when the person transfers or withdraws capital.
c) The income from\r\ndividend in shares according to guidance in Point g Clause 3 Article 2 of this\r\nCircular shall be calculated when the person transfers his shares.
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4. Tax calculation
Article\r\n11. Bases for calculation of tax on incomes from capital transfer.
1. Regarding income from\r\ntransfer of contributed capital
Bases for calculation of\r\ntax on incomes from transfer of contributed capital are assessable income and\r\nthe tax rate.
a) The assessable income\r\nfrom transfer of contributed capital equals the transfer price minus the\r\npurchase price of the transferred capital and rational expenses related to the\r\ngeneration of the income from capital transfer.
Where the enterprise does\r\nbookkeeping in foreign currencies and the contributed capital is transferred in\r\nforeign currencies, the transfer price and purchase price of the capital are\r\nalso expressed as foreign currencies. Where the enterprise does bookkeeping in\r\nVND and the contributed capital is transferred in foreign currencies, the\r\ntransfer price shall be expressed VND according to the average exchange rate on\r\nthe inter-bank foreign exchange market announced by the State Bank of Vietnam\r\nwhen the transfer is made.
a.1) Transfer price
Transfer price is the\r\namount of money that the individual receives under the capital transfer\r\ncontract.
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a.2) Purchase price
The purchase price of the\r\ntransferred capital is the value of contributed capital when the transfer is\r\nmade.
The value of contributed\r\ncapital at that time includes the value of the capital contributed to the\r\nestablishment of the enterprise, value of additional contributions, value of\r\npurchased capital, and value of capital from reinvested profit. To be specific:\r\n
a.2.1) For capital\r\ncontributed to the establishment of the enterprise, it is the value of capital\r\nwhen the contribution is made. The value of contributed capital is determined\r\nbased on accounting books and invoices.
a.2.2) For additional\r\ncapital contribution, it is the value of the additional capital contribution\r\nwhen the additional contribution is made. The value of additional capital\r\ncontribution is determined based on accounting books and invoices.
a.2.3) For purchased\r\ncapital, it is its value when the purchase is made. The purchase price is\r\ndetermined based on the contract to purchase capital contribution. If the\r\ncontract to purchase capital contribution does not specify the price or the\r\nprice stated in the contract is not conformable with the market price, the tax\r\nauthority may impose a purchase price in accordance with regulations of law on\r\ntax administration.
a.2.4) For the capital\r\nfrom reinvested profit, it is the value of the reinvested profit.
a.3) Deductible expenses\r\nwhen calculating taxable income from capital transfer are rational expenses\r\nthat are related to the generation of income from capital transfer with valid\r\ninvoices as prescribed. To be specific:
a.3.1) Expenses on legal\r\nprocedures necessary for the transfer.
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a.3.3) Other expenses\r\nrelated to the capital transfer.
b) Tax rate
The rate of personal\r\nincome tax on the income from transfer of contributed capital is 20% according\r\nto the whole income tax table.
c) Time to calculate the\r\nassessable income
The assessable income\r\nshall be calculated when the capital transfer contract takes effect. Where\r\nmaking contribution from another capital contribution, the assessable income\r\nfrom capital transfer shall be calculated when the person transfers or\r\nwithdraws capital.
d) Tax calculation
2. Regarding income from\r\ntransfer of securities
Bases for calculation of\r\ntax on incomes from transfer of securities are assessable income and the tax\r\nrate.
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The assessable income\r\nfrom transfer of securities is the price of each transfer.
a.1) Securities\r\ntransfer price is determined as follows:
a.1.1) The transfer\r\nprice of securities of a public company traded at the Stock Exchange is the\r\ntransaction price at the Stock Exchange. The executed price is the price of\r\nsecurities according to the order-matching result or the price from\r\ntransactions at the Stock Exchange.
a.1.2) The transfer\r\nprice of securities in cases other than the above case is the price written on\r\nthe transfer contract or the actual transfer price or the price in the\r\naccounting book of the transferor when the latest financial statement is made\r\nbefore the time of transfer according to regulations of law on accounting.
b) 46 Tax rate and tax\r\ncalculation:
Securities transferee\r\nshall pay 0.1% tax on the price of each transfer.
Tax calculation
c) Time to calculate the\r\nassessable income
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c.1) For securities of a\r\npublic company that are traded at the Stock Exchange, it is the time when the taxpayer\r\nreceives the income from securities transfer.
c.2) For securities of a\r\npublic company that are not traded at the Stock Exchange but only transferred\r\nvia the system of the Vietnam Securities Depository, it is the time the\r\nownership is transferred at the Vietnam Securities Depository.
c.3) For the securities\r\nthat do not fall into the cases above, it is the time the securities transfer\r\ncontract takes effect.
c.4) In case the capital\r\ncontribution is made by securities without paying tax when making capital\r\ncontribution, the time to calculate income from securities transfer to make\r\ncapital contribution is the time the person transfers/withdraws capital.
d) Receipt of shares paid\r\nas dividend.
In case of receipt of\r\nshares paid as dividend, the person may delay paying personal income tax when\r\nreceiving shares. When transferring such shares, the person shall pay personal\r\nincome tax on the income from capital investment and the income from transfer\r\nof securities. To be specific:
d.1) The basis for\r\ndetermination of the personal income tax payable on the income from capital\r\ninvestment is the value of dividend in the accounting book or the quantity of\r\nactual shares received multiplied by (x) the face value of such shares and the\r\nrate of personal income tax on the income from capital investment.
If the transfer price of\r\nthe shares paid as dividend is lower than the nominal price, the personal\r\nincome tax on capital investment shall be calculated at the market price when\r\nthe transfer is made.
If the person transfers the\r\nsame type of securities after receiving shares paid as dividend, the person\r\nshall declare and pay personal income tax on the all the shares paid as\r\ndividends.
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Example 12: Mr. K is a\r\nshareholder of joint-stock company X (listed at the Stock Exchange). In 2011,\r\nMr. K receives 5.000 shares paid as dividend by company X (the face value of a\r\nshare is 10.000 VND). In February 2014, Mr. K transfers 2.000 shares of company\r\nX at a price of 30.000 VND per share. In August 2014, Mr. K transfers 7.000\r\nshares at a price of 20.000 VND per share.
When making the transfer,\r\nMr. K has to pay personal income tax on the income from capital investment and\r\nthe income from transfer of securities. To be specific:
* For the transfer in\r\nFebruary 2014
- Personal income tax on\r\nthe income from capital investment:
(2.000 shares x\r\n10.000 VND) x 5% = 1.000.000 VND
- Personal income tax\r\n(preliminary) on income from transfer of securities:
(2.000 shares x\r\n30.000 VND) x 0,1% = 60.000 VND
* For the transfer in\r\nAugust 2014:
- Personal income tax on\r\nthe income from capital investment:
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- Personal income tax\r\n(preliminary) on income from transfer of securities:
(7.000 shares x\r\n20.000 VND) x 0,1% = 140.000 VND
Article\r\n12. Bases for calculation of tax on incomes from capital transfer real estate\r\ntransfer 47
Bases for calculation\r\nof tax on incomes from real estate transfer are the price of each transfer and\r\ntax rate.
1. Transfer price
a) The price of\r\ntransfer of right to use land without constructions thereon is the price\r\nwritten on the transfer contract at the time of transfer.
If the transfer\r\ncontract does not specify the price or the price written on the transfer\r\ncontract is lower than the land price imposed by the People’s Committee of the\r\nprovince at that time, the land price imposed by the People’s Committee of the province\r\nat that time shall apply.
b) The price of\r\ntransfer of right to use land with constructions thereon, including\r\noff-the-plan houses and constructions, is the price written on the transfer\r\ncontract at the time of transfer.
If the transfer\r\ncontract does not specify the land price or the land price written on the\r\ntransfer contract is lower than the land price imposed by the People’s\r\nCommittee of the province at that time, the land price imposed by the People’s\r\nCommittee of the province at that time shall apply according to the land law.
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Regarding off-the-plan\r\nhouses and constructions, if the contract does not specify the transfer price\r\nof the transfer price is lower than the ratio of capital contribution to total\r\ncontract value multiplied by (x) land price and the price for calculation of\r\nregistration fee imposed by the People’s Committee of the province, the\r\ntransfer price shall equal the price imposed by the People’s Committee of the\r\nprovince multiplied by (x) ratio of capital contribution to total contract\r\nvalue. If the People’s Committee of the province has not imposed the unit\r\nprice, the rate of construction investment announced by the Ministry of\r\nConstruction which is applicable when the transfer is made shall apply.
c) The price of\r\ntransfer of right to lease land/water surface is the price written on the\r\ntransfer contract at the time of transfer.
If the unit price for\r\nsublease written on the contract is lower than the price imposed by the\r\nPeople’s Committee of the province when the sublease is taken, the sublease\r\nprice shall be determined according to the price list compiled by the People’s\r\nCommittee of the province.
2. Tax rate
Tax on real estate\r\ntransfer is 2% of the transfer price or sublease price.
3. Time for taxing\r\nreal estate transfer is determined as follows:
- If the transfer\r\ncontract does not require the buyer to pay tax on behalf of the seller, the\r\ntaxing time is the effective date of the transfer contract as prescribed by\r\nlaw;
- If the transfer\r\ncontract requires the buyer to pay tax on behalf of the seller, the taxing time\r\nis time of registration of the right to own or right to use the real estate.
In case the person\r\nreceives an off-the-plan house or right to use land associated with\r\noff-the-plan constructions, the taxing time is the time when the person submits\r\ntax declaration documents to the tax authority.
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PIT on income from\r\nreal estate transfer is calculated as follows:
b) In case the\r\ntransferred real estate in under a co-ownership, the tax liability incurred by\r\neach taxpayer is proportional to their portions of real estate ownership. Bases\r\nfor determination of the portion of ownership are legal documents, including\r\ninitial capital contribution agreements, the testament, or the decision on\r\ndivision made by the court, etc. If no legitimate documents are provided, the\r\ntax liability incurred by each taxpayer shall be evenly divided.
Article\r\n13. Bases for calculation of tax on incomes from royalties.
Bases for calculation of\r\ntax on incomes from royalties are the assessable income and tax rate.
1. Assessable income
The assessable income\r\nfrom royalties is the excess over 10 million VND of income according to the\r\ntransfer contract, regardless of the number of payments or times the taxpayer\r\nreceives money when transferring subjects of intellectual property right or\r\ntechnology transfer.
If the transfer of the\r\nsame subject of intellectual property right or technology transfer to a\r\ntransferee is made into multiple contracts, the assessable income is excess\r\nover 10 million VND of incomes from all transfer contracts.
If the subject of\r\ntransfer is under a co-ownership, the assessable income shall be divided among\r\nthe co-owners. The division ratio depends on the Certificate of ownership or\r\nrights to use issued by the competent authority.
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3. Time to calculate the\r\nassessable income
The assessable income\r\nshall be calculated when the royalty is paid.
4. Tax calculation
Article\r\n14. Bases for calculation of tax on incomes from
Bases for calculation of\r\ntax on incomes from franchise are the assessable income and tax rate.
1. Assessable income
The assessable income\r\nfrom franchise is the excess over 10 million VND of income according to the\r\ntransfer contract, regardless of the number of payments or times the taxpayer\r\nreceives money.
If the franchise for the\r\nsame subject is made into multiple contracts, the assessable income is the\r\nexcess over 10 million VND of all franchise contracts.
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The rate of personal\r\nincome tax on the income from franchise is 5% according to the whole income tax\r\ntable.
3. Time to calculate the\r\nassessable income
The assessable income\r\nfrom franchise shall be calculated when the payment for franchise is made\r\nbetween the franchiser and franchisee.
4. Tax calculation
Article\r\n15. Bases for calculation of tax on incomes from winning prizes.
Bases for calculation of\r\ntax on incomes from winning prizes are the assessable income and tax rate.
1. Assessable income
The assessable income\r\nfrom a prize is the excess over 10 million VND of the prize the taxpayer\r\nreceives, regardless of the number of times of prize money receipt.
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Assessable income from\r\nsome games of chance:
a) The assessable income\r\nfrom a lottery prize is the excess over 10 million VND of 01 lottery prize\r\nwithout any deduction.
b) The assessable income\r\nfrom promotion prize in kind is the excess over 10 million VND of the prize\r\nthat is converted into cash at the market price when the prize is given without\r\nany deduction.
c)48 The assessable\r\nincome from betting is the amount of prize in excess of VND 10 million received\r\nby the player without any deductions.
2. The rate of personal\r\nincome tax on the income from wining prizes is 10% according to the whole income\r\ntax table.
3. Time to calculate the\r\nassessable income
The assessable income\r\nfrom prizes shall be calculated when the prizewinner receives the prize.
4. Tax calculation
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Bases for calculation of\r\ntax on incomes from inheritance and gifts are the assessable income and tax\r\nrate.
1. Assessable income
The assessable income from\r\ninheritance and gifts is the excess over 10 million VND of the inheritance or\r\ngifts received. The value of inheritance and gifts is determined as follows:
a)
a.1) The value of\r\nsecurities traded at the Stock Exchange is based on the reference price at the\r\nStock Exchange at the time of registration of securities ownership.
a.2) The value of\r\nsecurities in cases other than the above case is based on the book value\r\nprovided by the corresponding issuer at the time of making the latest financial\r\nstatement according to the law on accounting before the time of registration of\r\nsecurities ownership.
b) The assessable income\r\nfrom the inheritance and gifts that are capital contributions to economic\r\norganizations or business establishments is the value of the contributions\r\nbased on their latest book values of the companies before the contribution\r\nownership is registered.
c) The value of\r\ninheritance and gifts being real estate is determined as follows:
c.1) The value of right\r\nto use land is based on the land price list made by the People’s Committee of\r\nthe province before the person registers the right to use real estate.
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If the value is not\r\nidentifiable, the price for calculation of registration fee imposed by the\r\nPeople’s Committee of the province shall apply.
d) 50 Regarding\r\ninheritance and gifts being other assets of which the right to ownership or right\r\nto use shall be registered with the regulatory agency: the value of assets is\r\nbased on the price for calculation of registration fee imposed by the People’s\r\nCommittee of the province at the time the person registers the right to\r\nownership or right to use of inheritance and gifts.
If the person who\r\nreceives the inheritance or gift being imported goods has to pay taxes on the\r\nimport of such goods, the property value subject to PIT is the registration fee\r\ncalculation price imposed by the People’s Committee of the province at the time\r\nof registration of right to ownership or right to use of the property minus (-)\r\ntaxes paid by the person during the import stage.”
2. The rate of personal\r\nincome tax on the income from inheritance and gifts is 10% according to the\r\nwhole income tax table.
3. Time to calculate the\r\nassessable income
The assessable income\r\nfrom inheritance and gifts is calculated when the person registers the\r\nownership or right to use of inheritance and gift.
4. Tax payable
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Article\r\n17. Income from business
The rate of personal\r\nincome tax on income from business earned by a non-resident equals the revenue\r\nfrom business multiplied by (x) the tax rate.
1. Revenue:
The revenue from business\r\nearned by a non-resident is determined similarly to the revenue used to\r\ncalculate tax on income earned by a president from business according to\r\nguidance in Clause 1 Article 8 of this Circular.
2. Tax rate
Rate of personal income\r\ntax on income from business earned by a non-resident in each field and\r\nindustry:
a) 1% for goods sale.
b) 5% for service\r\nprovision.
c) 2% for production,\r\nconstruction, construction, and other businesses.
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Article\r\n18. Income from wages
1. The rate of personal income\r\ntax on income from wages earned by a non-resident equals the taxable income\r\nfrom wages multiplied by (x) 20% tax.
2. The taxable income\r\nfrom wages earned by a non-resident is similar to that earned by a resident\r\naccording to guidance in Clause 2 Article 8 of this Circular.
The taxable income from\r\nwages earned in by a non-resident that works both in Vietnam and a foreign\r\ncountry without being able to separate the income earned in Vietnam shall be\r\ncalculated as follows:
a) Where the foreigner is\r\nnot present in Vietnam:
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Where: the number of working\r\ndays in the year is calculated in accordance with the Labor Code of Vietnam.
b) Where the foreigner is\r\npresent in Vietnam:
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Other pre-tax taxable\r\nincomes earned in Vietnam mentioned in Point a and Point b above are other\r\nbenefits in cash or not in cash apart from wages that are provided for the\r\nemployee or paid on the employee’s behalf by the employer.
Article\r\n19. Income from capital investment
The personal income tax\r\non income from capital investment earned by a non-resident equals the total\r\ntaxable income earned by the non-resident from capital investment in another organization/individual\r\nin Vietnam multiplied by (x) 5% tax
The assessable income and\r\ntime to calculate assessable income from capital investment earned by the\r\nnon-resident are similar to those of a resident according to guidance in Clause\r\n1 and Clause 3 Article 10 of this Circular.
Article\r\n20. Income from capital transfer.
1. The personal income\r\ntax on the income from capital transfer earned by a non-resident equals the\r\ntotal amount of money the non-resident receives from the transfer of capital invested\r\nin organizations and individuals in Vietnam multiplied by (x) 0,1% tax, whether\r\nthe transfer is made in Vietnam or overseas.
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2. Transfer price in some\r\ncases:
a. When transferring\r\ncontributed capital, the transfer price is similar to that of a resident\r\naccording to guidance in Point a.1 Clause 1 Article 11 of this Circular.
b. When transferring\r\nsecurities, the transfer price is similar to that of a resident according to\r\nguidance in Point a.1 Clause 2 Article 11 of this Circular.
3. Time to calculate the\r\nassessable income:
a) The assessable income\r\nfrom transfer of contributed capital earned by a non-resident shall be\r\ncalculated when the capital transfer contract takes effect.
b) The time to calculate\r\nthe assessable income from transfer of securities earned by a non-resident is\r\nsimilar to that earned by a resident according to guidance in Point c Clause 2\r\nArticle 11 of this Circular
Article\r\n21. Income from real estate transfer
1. The personal income\r\ntax on the income from real estate transfer earned by a non-resident equals the\r\ntransfer price multiplied by (x) 2% tax.
The aforesaid transfer\r\nprice is the total amount the non-resident receives from the real estate\r\ntransfer without any deductions, including the cost price.
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3. The income from real\r\nestate transfer shall be calculated when the non-resident carries out the\r\nprocedure for real estate transfer as prescribed by law.
Article\r\n22. Incomes from royalties and franchise
1. Tax on income from\r\nroyalties
a) The tax on income from\r\nroyalties earned by a non-resident equals excess over 10 million VND of income\r\nfrom each contract to transfer the subjects of intellectual property right,\r\ntechnology transfer in Vietnam multiplied by 5% tax.
The determination of\r\nincome from royalties shall comply with Clause 1 Article 13 of this Circular.
b) The income from\r\nroyalties shall be calculated when the non-resident receives the royalties from\r\nthe payer.
2. Income from franchise
The tax on income from\r\nfranchise earned by a non-resident equals the excess over 10 million VND of\r\nincome from each franchise contract in Vietnam multiplied by 5% tax.
The determination of\r\nincome from franchise shall comply with Clause 1 Article 14 of this Circular.
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Article\r\n23. Incomes from prizes, inheritance, and gifts
1. The personal income\r\ntax on incomes from prizes, inheritance, or gifts earned by a non-resident\r\nequals the assessable income calculated according to guidance in Clause 2 of\r\nthis Article multiplied by (x) 10% tax.
2. Assessable income
a) The assessable income from\r\nwinning a prize earned by a non-resident is the excess over 10 million VND of\r\nthe prize won in Vietnam.
The income from winning\r\nprizes earned by a non-resident is similar to that earned by a resident\r\naccording to guidance in Clause 1 Article 15 of this Circular.
b) The taxable income\r\nfrom inheritance and gifts earned by a non-resident is the excess over 10\r\nmillion VND of the inheritance or gift received in Vietnam.
The income from\r\ninheritance and gifts earned by a non-resident is similar to that earned by a\r\nresident according to guidance in Clause 1 Article 16 of this Circular.
3. Time to calculate the\r\nassessable income
a) The assessable income\r\nfrom prizes shall be calculated when the organization or person in Vietnam pays\r\nthe prize money to the non-resident.
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c) The assessable income\r\nfrom gift is calculated when the person registers the ownership or rights to\r\nuse the assets in Vietnam.
Article\r\n24. Tax registration
1. Entities that must\r\napply for tax registration
According to Article 27\r\nof the Decree No. 65/2013/ND-CP, entities that are required to apply for\r\npersonal income tax registration are:
a) Income payers,\r\nincluding:
a.1) Business\r\norganizations and individuals, including their branches, dependent units,\r\naffiliates that do bookkeeping separately and have separate legal status.
a.2) State administrative\r\nagencies.
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a.4) Public service\r\nproviders.
a.5) International\r\norganizations and foreign organizations.
a.6) Project management boards,\r\nrepresentative offices of foreign organizations.
a.7) Other income payers.
b) Persons that earn\r\ntaxable incomes, including:
b.1) Persons that earn\r\nincomes from production or business, including freelancers; persons and\r\nhouseholds engaged in agricultural production that are not exempt from personal\r\nincome tax. Persons earning incomes from production or business who apply for\r\nthe registration of personal income tax together with other taxes.
b.2) Wage earners,\r\nincluding foreigners working for foreign contractors and foreign\r\nsub-contractors in Vietnam.
b.3) Persons that\r\ntransfer real estate.
b.4) Persons that earn\r\nother taxable incomes (if required).
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Entities mentioned in\r\nPoint a, Point b and Point c Clause 1 of this Article are not required to apply\r\nfor new tax registration if tax registration has been obtained and tax\r\nidentification number have been issued. The person that earns multiple taxable\r\nincomes shall apply for tax registration once. The tax identification number\r\nshall be used to make declare all kinds of incomes.
2. Application for tax
The tax registration\r\nprocedure and application are specified in guiding documents on tax\r\nadministration.
3. Places where\r\napplications for tax are submitted
a) Places where\r\napplications for tax are submitted are specified in guiding documents on tax\r\nadministration.
b) Places where\r\napplications for tax are submitted in some particular cases:
b.1) The person that\r\nearns income from wages shall submit the application for tax to the income\r\nplayer or the local tax authority that directly monitors the income payer. The\r\nincome payer shall consolidate and submit applications for tax to the local tax\r\nauthority.
b.2) The person that\r\nearns income from multiple sources, including business, wages, other taxable\r\nincomes may submit the application for tax to the income payer or the local\r\nSub-department of taxation.
b.3) The person that\r\nearns other taxable incomes may submit the application for tax at any tax\r\nauthority.
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a) The representative of\r\nthe group of business persons shall apply for tax registration according to\r\nguidance in order to obtain the personal tax identification number. The tax\r\nidentification number of the representative of the group of business persons\r\nshall be used to declare tax, pay VAT, excise duty, license tax, etc. incurred\r\nby the whole group, and used to declare personal income tax incurred by the\r\nrepresentative himself. Other capital contributors in the group shall apply for\r\ntax registration in order to obtain separate tax identification numbers in the\r\nsame way a business person does.
b) If the person that\r\ntransfers real estate has not had a tax identification number, the tax\r\nauthority shall automatically issue a tax identification number to the person\r\naccording to the personal information in the real estate transfer dossier.
c) If a dependant for\r\nwhom the taxpayer applies for a deduction has not had a tax identification\r\nnumber, the tax authority shall automatically issue the tax identification\r\nnumber to the dependant according to the dependant’s information in the\r\napplication for deduction (the form is provided in guiding documents on tax\r\nadministration) made by the taxpayer.
Article\r\n25. Tax deduction and certificate of tax deduction
1. Tax deduction
The tax deduction is an\r\nact of calculating and deducting the tax payable from the taxpayer’s income by\r\nthe income payer before the income is paid to the tax payer. To be specific:
a) Incomes earned by\r\nnon-residents
The organization or\r\nindividual that pays taxable incomes to the non-resident shall deduct the\r\npersonal income tax from the income before it is paid. The determination of tax\r\nto be deducted shall comply with Chapter III (from Article 17 to Article 23) of\r\nthis Circular.
b) Income from wages
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b.2) The income payer\r\nshall still deduct tax from incomes earned residents that sign labor contracts\r\nfor 03 months but resign before such labor contracts expire according to the\r\nprogressive tax table.
b.3) The income payer\r\nshall deduct tax from incomes earned by the foreigners working in Vietnam based\r\non the duration of work in Vietnam written in the contract or letter of\r\nintroduction according to the progressive tax table (if the person has worked\r\nin Vietnam for at least 183 days in the tax year) or the whole income tax table\r\n(if the person has worked in Vietnam for fewer than 183 days in the tax year).
b.4)
Before paying the\r\nemployee, the income payer has the responsibility to deduct tax from the\r\npremiums of life insurance or other optional insurances with accrual of\r\ninsurance bought by the income payer for the employee from the insurer not\r\nestablished and operating under Vietnam’s law but permitted to sell insurance\r\nin Vietnam. The amount of tax deducted is specified in Clause 2 Article 14 of\r\nCircular No. 92/2015/TT-BTC.
b.5) The determination of\r\ntax deducted from incomes from wages earned by residents shall comply with\r\nArticle 7 of this Circular; the determination of tax withheld from incomes from\r\nwages earned by non-residents shall comply with Article 18 of this Circular.
c) 52 Incomes from\r\noperation of insurance agents, lottery agents, and network marketing agents; incomes\r\nfrom lease of property to enterprises and/or business organizations.
Lottery companies,\r\ninsurers and network marketing companies shall be responsible for deducting PIT\r\nbefore paying agents whose commission is over VND 100 million/year. The amount\r\nof tax deducted is specified in Clause 2 Article 9 of Circular No.\r\n92/2015/TT-BTC.
The enterprise or\r\nbusiness organization who leases property from a person has the responsibility\r\nto deduct VAT and PIT before paying the lessor if the amount paid to the lessor\r\nis over VND 100 million/year and the lease contract stipulates that the lessee\r\npays tax on behalf of the lessor. The amount of tax deducted is specified in\r\nClause 2 Article 8 of Circular No. 92/2015/TT-BTC.
d) Income from capital\r\ninvestment
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dd) Income from transfer\r\nof securities
0,1% tax on the transfer\r\nprice shall be deducted from every income from securities transfer before the income\r\nis paid to the transferor. Tax shall be deducted as follows:
dd.1) Regarding\r\nsecurities traded at the Stock Exchange:
dd.1.1) The securities\r\ncompany or commercial bank where the person opens the depository account shall\r\ndeduct 0.1% personal income tax on the transfer price before the income is paid\r\nto the person. The determination of tax to be deducted shall comply with Point\r\nb.2 Clause 2 Article 11 of this Circular.
dd.1.2) The asset\r\nmanagement company to which the person entrusts the management of securities\r\ninvestment portfolio shall deduct 0.1% personal income tax on the transfer\r\nprice of the entrusting person according to the distribution table sent to the\r\ndepository bank where the company opens its depository account.
dd.2) Regarding\r\nsecurities transfer without the transaction system of the Stock Exchange:
dd.2.1) For securities of\r\na public company that has applied for securities registration at the Vietnam\r\nSecurities Depository:
The securities company, commercial\r\nbank where the person opens the depository account shall deduct 0,1% personal\r\nincome tax on the transfer price before carrying out the procedure for transfer\r\nof the securities ownership at the Vietnam Securities Depository.
dd.2.2) For securities of\r\na joint-stock company that is not a public company, issues securities and\r\nauthorizes a securities company to manage the list of shareholders:
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The person that transfers\r\nsecurities shall present the transfer contract to the securities company when\r\ncarrying out the procedure for transfer of securities ownership.
e) Incomes earned by\r\nnon-residents from transfer of contributed capital
The organization or\r\nperson that receives capital contribution from a non-resident shall deduct 0.1%\r\npersonal income tax on the transfer price.
g) Income from winning\r\nprizes
The prize provider shall\r\ndeduct personal income tax before providing prizes to the prizewinner. The\r\ndetermination of tax to be deducted shall comply with Article 15 of this\r\nCircular.
h) Incomes from royalties\r\nand franchise
The organization or\r\nperson that pays income from royalties or franchise shall deduct personal\r\nincome tax before the income is paid to the person. The deducted tax equals the\r\nexcess over 10 million VND of the income according to the transfer contract\r\nmultiplied by (x) 5% tax. If the contract has a high value and the payment is\r\nmade in installments, when paying the first installment, the organization or\r\nperson that pays income shall subtract 10 million VND from the payment, then\r\nwithhold the amount that equals the remaining amount multiplied by 5% tax.\r\nIncome tax on the next installments shall be deducted from each installment.
i) Tax deduction in other\r\ncases
The organization or\r\nperson that pays a total income from 2 million VND to a resident that does not\r\nsign a labor contract (according to guidance in Point c and Point d Clause 2\r\nArticle 2 of this Circular) or that signs a labor contract for less than 03\r\nmonths shall deduct 10% tax on the income before the income is paid to the\r\nperson.
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According to the\r\ncommitment made by the income earner, the income payer shall not deduct tax. At\r\nthe end of the tax year, the income payer shall make a list of persons that\r\nearn incomes below that taxable level (the form is provided in guiding\r\ndocuments on tax administration) and send it to the tax authority. Each person\r\nshall be responsible for his/her commitment. Any deceit discovered shall be\r\npenalized in accordance with the Law on Tax Administration.
Persons that make\r\ncommitments according to guidance in this Point shall obtain tax registration\r\nand have tax identification numbers when such commitments are made.
2. Tax deduction\r\ncertificate
a) After deducting tax\r\naccording to guidance in Clause 1 of this Article, the income payer shall issue\r\ntax deduction certificates at the request of persons that have tax deducted.\r\nThe tax deduction certificate shall not be issued if the person delegates the\r\ntax settlement.
b) Issuance of tax\r\ndeduction certificates in some particular cases:
b.1) If the person does\r\nnot sign a labor contract or signs a labor contract for less than 03 months,\r\nthe person is entitled to request the income payer to issue the tax deduction\r\ncertificate every time tax is deducted, or issue a single certificate of tax\r\ndeduction for multiple deductions in the same tax period.
Example 15: Mr. Q signs a\r\nservice contract with company X to cultivate ornamental plants on the company’s\r\npremises once per month from September 2013 to April 2014. Company X pays an\r\nincome of 03 million VND per month to Mr. Q. In this case, Mr. Q may request\r\ncompany X to issue a tax deduction certificate every month or one certificate\r\nwhich reflects the deducted tax over the period from September 2013 to December\r\n2013, and one tax deduction certificate over the period from January 2014 to\r\nApril 2014.
b.2) If the person signs\r\na labor contract for more than 03 months, the income payer shall issue only one\r\ncertificate of tax deduction in a tax period.
Example 16: Mr. R signs a\r\nlong-term labor contract (from September 2013 till the end of August 2014) with\r\ncompany Y. In this case, if Mr. R is required to settle tax at the tax\r\nauthority and requests company Y to issue the certificate of tax deduction,\r\ncompany Y shall issue 01 certificate which reflects the deducted tax from\r\nSeptember 2013 till the end of December 2013, and 01 certificate for the period\r\nfrom January 2014 till the end of August 2014.
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The payer of taxable incomes\r\nand the person that earns taxable incomes shall declare tax and settle tax in\r\naccordance with the procedure provided in guiding documents on tax\r\nadministration. Rules for declaration of tax in some cases:
1. Tax declaration made\r\nby the payer of taxable income.
a) The income payer that\r\ndeducts personal income tax shall declare tax monthly or quarterly. The income\r\npayer is not required to declare tax if no personal income tax is deducted in\r\nthe month or in the quarter.
b) The monthly or\r\nquarterly tax declaration shall be made from the first month in which tax is\r\ndeducted, and is applicable to the whole tax year. To be specific:
b.1) The income payer\r\nthat deducts personal income tax on 50 million VND or more in a month in at\r\nleast one declaration of shall declare tax monthly, unless the income payer is\r\nrequired to declare tax quarterly.
b.2) Income payers that\r\nare not required to declare tax monthly according to the above guidance shall\r\ndeclare tax quarterly.
c) The payer of taxable\r\nincome shall declare and settle tax on behalf of the authorizing person,\r\nwhether or not tax is deducted.
2. Tax declaration made\r\nby residents that earn incomes from wages and business
a) Residents that earn\r\nincomes from wages shall directly declare tax at tax authorities. To be\r\nspecific:
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a.2) Residents that earn\r\nincomes from wages paid by overseas organizations and individuals shall\r\ndirectly declare tax quarterly at tax authorities.
b) Residents, groups of\r\nresidents that earn incomes from business shall directly declare tax at tax\r\nauthorities. To be specific:
b.1) Business persons, groups\r\nof business persons that pay tax according to tax declaration method are\r\nbusiness persons, groups of business persons that comply with regulations of\r\nlaw on accounting and invoices and business persons, groups of business persons\r\nthat fail to separate expense from revenue. They shall declare tax quarterly.
b.2) Business persons,\r\ngroups of business persons that pay flat tax are business persons, groups of\r\nbusiness persons that do not comply with the regulations of law on accounting\r\nand invoices and fail to determine revenue, expense, and taxable income. They\r\nshall declare tax annually.
b.3) Each nomadic\r\nbusiness person shall declare personal income tax every time it is incurred.
b.4) Each business person\r\nthat uses invoice sold separately by the tax authority shall declare personal\r\nincome tax every time the revenue is earned.
b.5) Each non-business\r\nperson that sells goods and services and needs to issue invoices to their\r\ncustomers shall declare tax when it is incurred.
b.6) Each person or group\r\nof persons that earns income from lease of houses, rights to use land, water\r\nsurface and other property shall declare tax quarterly or every time it is\r\nincurred.
c) 53 A resident earns\r\nan income from his salaries, wages, or business shall make a tax declaration\r\nand settlement if there are additional taxes payable or overpaid taxes which\r\nclaim the tax refund or offset against the tax in the next tax period, except\r\nfor the following case:
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c.2) A person or a\r\nbusiness household earns an income from their business and has paid taxes by\r\nthe flat tax method.
c.3) A person or a\r\nbusiness household only earns an income from lease of their houses or rights to\r\nuse land paid taxes according to their declaration at their leasing houses or\r\nlands.
c.4) A person who\r\nearns both an income from their salaries or wages from an at least 3-month\r\nlabor contract with a company and other incomes at other companies provided\r\nthat it is not more than VND 10 million and his income has been withheld at 10%\r\nby his employer, he is only required to settle tax on that income on request.
c.5) A person who earns\r\nboth an income from their salaries or wages from an at least 3-month labor\r\ncontract and other incomes from lease of his houses or lands provided that his\r\naverage revenue in a year is not more than VND 10 million paid taxes at his\r\nleasing houses or lands, he is only required to settle tax on that income on\r\nrequest.
c.6) A person who is\r\nan insurance agent, a lottery agent, or a multi-level marketing agent whose\r\npersonal income tax has been deducted by the income payer shall not settle tax\r\non that income.
d) The wage earner shall\r\nrequest the income payer to settle tax on their behalf in the following cases:
d.1) The person that only\r\nearns income from wages signs a labor contract for 03 months or more in a unit\r\nand is actually working at that unit when delegating tax settlement, even he\r\nhas not worked for 12 months in the year.
d.2) The wage earner\r\nsigns a labor contract for 03 months or more and earns other incomes according\r\nto guidance in Point c.4 and Point c.5 Clause 2 of this Article.
dd) The income payer\r\nshall only settle tax on the income that it pays on the person’s behalf.
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e.1) The resident that\r\nearns an income overseas and has paid personal income tax on that income\r\noverseas shall have the tax paid overseas deducted. The amount of tax deducted\r\nshall not exceed the tax payable on the income earned overseas according to\r\nVietnam’s tax table. The ratio is based on the ratio of income earned overseas\r\nto the total taxable income.
e.2) If the person earns\r\nincomes from business and wages and has been present in Vietnam in the first\r\ncalendar year for fewer than 183 days, but has been present in Vietnam for 183\r\ndays or more within 12 consecutive months from the date of arrival.
- In the first tax year:\r\nhe/she shall make tax declaration and submit the tax settlement dossier by the\r\n90th day from the end of the 12 consecutive months.
- From the second tax\r\nyear: he/she shall make tax declaration and submit the tax settlement dossier\r\nby the 90th day from the end of the calendar year. The remaining tax\r\npayable in the second tax year is calculated as follows:
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Example 17: Mr. S is a foreign\r\nwho first comes to Vietnam and works under a labor contract from June 01, 2014\r\nto May 31, 2016. In 2014, Mr. S has been present in Vietnam for 80 days and\r\nearned 134 million VND in wages. In 2015, Mr. S is present in Vietnam for 110\r\ndays during the period from January 01, 2015 until the end of May 31, 2015, and\r\nearns 106 million VND in wages. From June 01, 2015 to December 31, 2015, Mr. S\r\nhas been in Vietnam for 105 days and earned 122 million VND in wages. Mr. S\r\ndoes not apply for deductions for dependants and does not pay insurance\r\npremiums or make charitable donations.
The personal income tax\r\npayable by Mr. S is calculated as follows:
+ In 2014, Mr. S is a\r\nnon-resident, but for the period of 12 consecutive months from June 01, 2014 to\r\nthe end of May 31, 2015, Mr. S has been present in Vietnam for totally 190 days\r\n(80 days + 110 days). Thus Mr. S is a resident in Vietnam.
+ In the first tax year\r\nfrom June 01, 2014 to May 31, 2015):
- Total taxable income in\r\nthe first tax year:
134 million VND + 106\r\nmillion VND = 240 million VND
- Personal deduction: 9\r\nmillion VND x 12 = 108 million VND
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- Personal income tax\r\npayable in the first tax year: 60 million VND x 5% + (120 million VND - 60\r\nmillion VND) x 10% + (132 million VND - 120 million VND) x 15% = 10,8 million\r\nVND
+ In the second tax year\r\n(from January 01, 2015 to the end of December 31, 2015), Mr. S has been present\r\nin Vietnam for 215 days (110 days + 105 days) and is considered a resident in\r\nVietnam.
- Taxable income earned\r\nin 2015:
106 million VND + 122\r\nmillion VND = 228 million VND
- Personal deduction: 9\r\nmillion VND x 12 = 108 million VND
- Assessable income in\r\n2015:
228 million VND – 108\r\nmillion VND = 120 million VND
- Personal income tax\r\npayable in the 2015:
(60 million VND x\r\n5%) + (120 million VND – 60 million VND) x 10% = 9 million VND
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- Deductible duplicated\r\ntax:
(10.8 million\r\nVND/12 months) x 5 months = 4,5 million VND.
- Personal income tax\r\npayable in the 2015:
9 million VND – 4,5\r\nmillion VND = 4,5 million VND
e.3) The resident that is\r\na foreigner and terminates the labor contract in Vietnam shall settle tax at\r\nthe tax authority before departure.
e.4) The person that\r\nleases out houses, rights to use land, water surface and other property shall\r\nsettle personal income tax, except for the cases in which tax settlement is\r\nexempt according to guidance in Point c.3 and Point c.5 Clause 2 of this\r\nArticle. To be specific:
e.4.1) The person that\r\ndeclares tax quarterly or when it is incurred under a contract that is due\r\nwithin 01 year shall settle tax in the same way the person that pays tax\r\naccording to declaration does.
e.4.2) Where the person\r\ndeclares tax when it is incurred under a contract that is due after 01 year and\r\nreceives a deposit for a lease period, the person shall settle tax in one of\r\nthe following methods: if tax is completely settled in the first year, the\r\nrevenue is the lump-sum payment and personal deductions shall be made for a\r\nyear, not the next; if tax is settled annually, the income from the lump-sum\r\npayment shall be provisionally declared and personal deductions shall be made\r\nfor the first year, the revenue from lease of property shall be redistributed\r\nin the next years and personal deductions shall be calculated when they arise.
e.5) Persons that earn\r\nincomes from the insurance agents, lottery agents, or network marketing shall\r\ndirectly settle tax at tax authorities if required.
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e.7) Non-resident\r\nbusiness persons, groups of business persons that have fixed business locations\r\nin Vietnam shall declare and settle tax in the same way residents do.
3. Declaration of tax on\r\nincome from real estate transfer
a) Persons that earn\r\nincomes from real estate transfer shall declare tax when it is incurred,\r\nincluding persons eligible for tax exemption. Declaration of tax in some cases:\r\n
a.1) If the person puts\r\nup his/her rights to use land or house ownership as collateral loans or for\r\npayment at the credit institution, the branch of foreign bank and fails to pay\r\ndebts when they are due, the branch of foreign bank and the credit institution\r\nshall liquidate, sell such real estate, declare and pay personal income tax on\r\nthe person’s behalf before setting the person’s debts.
a.2) If the person\r\nmortgages his rights to use land or house ownership to take loans or make\r\npayment with other organizations or persons, then transfers the whole or part\r\nof such real estate to pay debts, the person that has the rights to use land or\r\nhouse ownership shall declare and pay personal income tax, or the\r\norganization/person conducting transfer procedures on the person’s behalf shall\r\ndeclare and pay personal income tax on the person’s behalf before settling the\r\ndebts.
a.3) Where a person\r\ntransfers the real estate to another organization or person under a court’s\r\ndecision, the transferor shall declare and pay personal income tax, or the\r\norganization/person holding the auction shall declare and pay personal income\r\ntax on behalf of the transferor. The real estate that is confiscated and put up\r\nfor auction by the competent authority, personal income tax is not required to\r\nbe paid.
a.4) If every person\r\ntransfers land and houses that do not fall into the case in which agricultural\r\nland is converted to serve production, which is eligible for exemption of\r\npersonal income tax according to guidance in Point dd Clause 1 Article 3 of\r\nthis Circular, each person who transfers land and houses shall declare and pay\r\npersonal income tax.
a.5) If an\r\norganization/person declares personal income tax on real estate transfer on\r\nbehalf of another person, such organization/person shall state “On behalf of\r\nthe taxpayer or the taxpayer's legal representative”, sign, write the full\r\nname, and append the organization’s seal (if any). The taxpayer in tax return\r\nand tax receipts is still the person that transfers real estate.
b) The real estate\r\nauthority shall only conduct the procedure for transfer of the ownership of,\r\nrights to use real estate after personal income tax invoices are presented, or\r\nthe tax authority certifies that the income from real estate transfer is\r\neligible for tax exemption or deferred tax collection.
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a) The person that\r\ntransfers contributed capital shall declare tax when a transfer is made,\r\nwhether or not incomes are earned.
b) The person that earns\r\nincome from transfer of contributed capital in Vietnam is not required to directly\r\ndeclare tax at the tax authority. The transferee shall deduct tax according to\r\nguidance in Point e Clause 1 Article 25 of this Circular and declare tax when\r\nit is incurred.
c) If the company changes\r\nthe list of capital contributors when transferring capital without documents\r\nproving that the capital transferor has fulfilled the tax obligations, the\r\ntransferee company shall declare and pay tax on the person’s behalf.
The transferee company\r\nthat pays tax on the person’s behalf shall also declare personal income tax on\r\nthe person’s behalf. Such company shall state “On behalf of the taxpayer or the\r\ntaxpayer's legal representative”, sign, write the full name, and append the\r\ncompany’s seal (if any). The taxpayer on tax return and tax receipts is the transferor\r\n(when transferring a resident’s capital) or the transferee (when transferring a\r\nnon-resident’s capital).
5. Declaration of tax on\r\nincome from transfer of securities
a) The person that\r\ntransfers securities of a public company at the Stock Exchange is not required\r\nto declare tax directly at the tax authority. The account owner, commercial\r\nbank where the person opens his depository account, the asset management\r\ncompany where the person entrusts the management of the investment portfolio\r\nshall declare tax according to guidance in Clause 1 Article 26 of this\r\nCircular.
b) Where the person\r\ntransfers securities without the transaction system of the Stock Exchange:
b.1) The person that\r\ntransfers securities of a public company registered at the Vietnam Securities\r\nDepository is not required to declare tax directly at the tax authority. The\r\nsecurities company, commercial bank where the person opens his depository\r\naccount shall deduct and declare tax according to guidance in Clause 1 Article\r\n26 of this Circular.
b.2) The person that\r\ntransfers securities of a joint-stock company that is not public company but\r\nissues securities and authorizes a securities company to manage shareholder\r\nlist is not required to declare tax directly at the tax authority. The\r\nsecurities company authorized to manage shareholder list shall deduct and\r\ndeclare tax according to guidance in Clause 1 Article 26 of this Circular.
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d) If the company changes\r\nthe list of shareholders when transferring securities without documents proving\r\nthat the transferor has fulfilled tax obligations, the transferee company shall\r\ndeclare and pay tax on the transferor’s behalf.
If the transferee company\r\nthat declares tax on the transferor’s behalf, the transferor company shall also\r\ndeclare personal income tax on the person’s behalf. Such company shall state\r\n“On behalf of the taxpayer or the taxpayer's legal representative”, sign, write\r\nthe full name, and append the company’s seal (if any). The taxpayer in tax\r\nreturn and tax receipts is the securities transferor.
dd) The securities\r\ntransferor shall directly declare and settle tax at the tax authority at the\r\nyear’s end if he wishes to settle tax.
6. Declaration of tax on\r\nincomes from inheritance and gifts
a) The person that earns\r\nincome from inheritance or gifts shall declare tax when it is incurred\r\n(including persons eligible for tax exemption).
b) Relevant state\r\nagencies and organizations shall only carry out the procedure for transfer of\r\nthe ownership or rights to use real estate, securities, contributed capital,\r\nand other assets, the ownership or right to use of which must be registered, to\r\nthe inheritor or recipient after having the tax receipt or obtaining\r\ncertification that incomes from inheritance or gifts being real estate are\r\ntax-free.
7. Declaration of tax on\r\noverseas incomes earned by residents
The resident that earns\r\nincome overseas shall declare tax when it is incurred. The resident that earns\r\nincome from wages overseas shall declare tax quarterly.
8. Declaration of tax on\r\nincomes earned in Vietnam but received overseas by non-residents
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b) The non-resident that\r\nearns income from real estate or capital transfer (including securities\r\ntransfer) in Vietnam but receives such income overseas shall declare tax when\r\nit is incurred according to guidance in Clause 3, Clause 4 and Clause 5 of this\r\nArticle.
9. Declaration of tax on\r\nincome from capital investment in case of receipt of shares as dividends or\r\nreinvested profits.
The person that receives\r\nshares as dividends or reinvested profits is not required to declare and pay\r\ntax upon receipt. When transferring capital, withdrawing capital, or dissolving\r\nthe enterprise, the person shall declare and pay tax on the income from capital\r\ntransfer and capital investment.
10. Declaration of tax on\r\nincome from transfer of capital, securities, real estate in case of capital\r\ncontribution by contributed capital, securities, or real estate.
The person that contributes\r\ncapital by contributed capital, securities, or real estate is not required to\r\ndeclare and pay tax when making the contribution. When transferring capital,\r\nwithdrawing capital, or dissolving the enterprise, the person shall declare and\r\npay tax on the income from transfer of capital, real estate when contributing\r\ncapital and carrying out transfer.
11. Declaration of tax on\r\nincome from bonus shares
The person is not\r\nrequired to pay tax on wages when receiving bonus shares from the employer. The\r\nperson shall declare tax on incomes from transfer of shares and wages when\r\ntransferring bonus shares.
When an organization\r\nestablished and operating within Vietnam’s law (hereinafter referred to as\r\n“Vietnamese party”) signs a contract to purchase services of a foreign\r\ncontractor that signs labor contracts with foreign employees in Vietnam, the\r\nVietnamese party shall notify the foreign contractor of obligations to pay\r\npersonal income tax incurred by the foreign employees, obligations to provide\r\ninformation about the foreign employees, including their names, nationalities,\r\npassport numbers, working duration, positions, and incomes for the Vietnamese\r\nparty. The Vietnamese party shall provide such information for the tax\r\nauthority at least 07 days before such foreign employees start to work in\r\nVietnam.
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1. The refund of personal\r\nincome tax applies to persons that have registered and obtain tax\r\nidentification numbers when they submit the tax settlement dossier.
2. If the person has\r\nauthorized the income payer to settle tax, tax refund shall be made via the\r\nincome payer. The income payer shall offset the overpaid and underpaid tax.\r\nAfter being offset, the overpaid tax shall be offset against the tax in the\r\nnext period or refunded on request.
3. The person that\r\ndeclares tax directly may choose to claim a tax refund or offset it against the\r\ntax in the next period at the same tax authority.
4. The person that is\r\neligible for the refund of personal income tax and submits the tax settlement\r\nbehind schedule is exempt from fines for overdue tax statement.
Article\r\n29. Entry into force 54
1. This Circular comes\r\ninto force from October 01, 2013.
Regulations on personal\r\nincome tax policies in the Law on amendments to the Law on Personal Income Tax,\r\nand the Decree No. 65/2013/ND-CP will come into force from the effective date\r\nof the Law and Decree (July 01, 2013).
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2. Guidelines on personal\r\nincome tax that are provided by the Ministry of Finance before the effective\r\ndate of this Circular and are not conformable with those in this Circular are\r\nabolished.
Article\r\n30. Implementation responsibilities\r\n55
1. The Law on Tax\r\nAdministration and its guiding documents shall apply to contents related to tax\r\nadministration other than those under guidance in this Circular.
2. The settlement of\r\nissues and difficulties related personal income tax that arise before January\r\n01, 2013 shall continue to comply with guiding documents that are effective at\r\nthat time.
3. The taxable income\r\nrate shall be uniformly applied to business persons according to guidance in\r\nArticle 8 of this Circular from January 1, 2014.
4. Regarding contracts to\r\nsell floors and contribute capital to obtain the right to buy floors, houses,\r\nand apartments that are signed before the effective date of the Government's\r\nDecree No. 71/2010/ND-CP dated June 23, 2010 on elaboration of the Law on\r\nHousing, and allowed to be transferred by the investor, tax shall be declared\r\nand paid according to guidance similar to that on transfer of off-the-plan\r\nhouses.
5. 56 With\r\nregard to a person using a transferred real estate during the period from July\r\n1, 1994 to before January 1, 2009, if he/she is granted a Certificate of land\r\nuse right, house ownership and other property thereon by the regulatory agencies\r\naccording to his application submitted from January 1, 2009, he/she shall only\r\npay personal income tax once. If a person uses a transferred real estate before\r\nJuly 1, 1994, he is eligible for exemption from personal income tax.
From January 1, 2009\r\n(implementation of the Law on Personal Income Tax), every person that transfers\r\nreal estate, whether under a notarized contract, a handwritten document, or no\r\ncontract at all, shall pay personal income tax on every transfer.”
6. Persons eligible for\r\npersonal income tax incentives before the effective date of the Law on\r\namendments to the Law on Personal Income Tax are still eligible for such\r\nincentives for the remaining period.
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Any difficulties that\r\narise during the implementation should be reported to the Ministry of Finance\r\n(the General Department of Taxation) for consideration and settlement./.
\r\n PP. MINISTER
\r\n DEPUTY MINISTER
\r\n
\r\n
\r\n
\r\n
\r\n Tran Xuan Ha
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The progressive method\r\nfor calculating tax is abridged as follows:
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1
- Circular No.\r\n111/2013/TT-BTC dated August 15, 2013 of the Minister of Finance on guidelines for\r\nthe implementation of the Law on Personal Income Tax, the Law on amendments to\r\nthe Law on Personal Income Tax, and the Government's Decree No. 65/2013/ND-CP\r\non elaboration of some Articles of the Law on Personal Income Tax and the Law\r\non amendments to the Law on Personal Income Tax, which comes into force from\r\nOctober 01, 2013;
- Circular No.\r\n119/2014/TT-BTC dated August 25, 2014 of the Ministry of Finance on amendments\r\nto some Articles of Circular No. 156/2013/TT-BTC dated November 06, 2013,\r\nCircular No. 111/2013/TT-BTC dated August 15, 2013, Circular No.\r\n219/2013/TT-BTC dated December 31, 2013, Circular No. 08/2013/TT-BTC dated\r\nJanuary 10, 2013, Circular No. 85/2011/TT-BTC dated June 17, 2011, Circular No.\r\n39/2014/TT-BTC dated March 31, 2014, and Circular No. 78/2014/TT-BTC dated June\r\n18, 2014 of the Ministry of Finance for reform and simplification of tax\r\nformalities, which comes into force from September 01, 2014;
- Circular No.\r\n151/2014/TT-BTC dated October 10, 2014 of the Ministry of Finance on guidance\r\non implementation of Government’s Decree No. 91/2014/ND-CP dated October 01,\r\n2014 on amendments to Decrees on taxation, which comes into force from November\r\n15, 2014;
- Circular No.\r\n92/2015/TT-BTC dated June 15, 2015 of the Ministry of Finance on guidelines for\r\nVAT and personal income tax incurred by residents conducting business,\r\namendments to some Articles on personal income tax of the Law No. 71/2014/QH13\r\non amendments to tax laws and the Government's Decree No. 12/2015/ND-CP dated\r\nFebruary 12, 2015 on guidelines for implementation of the Law on amendments to\r\nLaws and Decrees on taxation, which comes into force from July 30, 2015.
- Circular No.\r\n25/2018/TT-BTC dated March 16, 2018 of the Ministry of Finance on guidelines\r\nfor the Government’s Decree No. 146/2017/ND-CP dated December 15, 2017 on\r\namendments to some Articles of the Circular No.78/2014/TT-BTC dated June 18,\r\n2014 of the Ministry of Finance and Circular No.111/2013/TT-BTC dated August\r\n15, 2013 of the Ministry of Finance, which comes into force from May 01, 2018.
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2
“The
The Law on Value-added\r\nTax No. 13/2008/QH12 dated June 03, 2008 and the Law No. 31/2013/QH13 dated\r\nJune 19, 2013 on amendments to the Law on Value-added Tax;
The Government’s\r\nDecree No. 83/2013/ND-CP dated July 22, 2013 on elaboration of implementation\r\nof some Articles of the Law on Tax Administration and the Law on amendments to\r\nsome Articles of the Law on Tax Administration;
The Government's\r\nDecree No. 209/2013/ND-CP dated December 18, 2013 on guidelines for the Law on\r\nValue-added Tax;
The Government's\r\nDecree No. 51/2010/ND-CP dated May 14, 2010 on service supply and sale invoices\r\nand the Government's Decree No. 04/2014/ND-CP dated January 17, 2014 on\r\namendments to Decree No. 51/2010/ND-CP dated May 14, 2010;
The Government's\r\nDecree No. 218/2013/ND-CP dated December 26, 2013 on guidelines for the Law on\r\nCorporate Income Tax;
The Government's\r\nDecree No. 215/2013/ND-CP dated December 23, 2013 on functions, tasks,\r\nentitlements and organizational structure of the Ministry of Finance;
At the request of the\r\nDirector of the General Department of Taxation,
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- Circular No.\r\n151/2014/TT-BTC on guidance on implementation of Government’s Decree No.\r\n91/2014/ND-CP dated October 01, 2014 on amendments to Decrees on taxation is\r\npromulgated pursuant to:
“The Law on Tax\r\nAdministration No. 78/2006/QH11 and Law No. 21/2012/QH13 on amendments to the\r\nLaw on Tax Administration;
The Law on Personal\r\nIncome Tax No. 04/2007/QH12 and Law No. 26/2012/QH13 on amendments to the Law\r\non Personal Income Tax;
The Law on Value-added\r\nTax No. 13/2008/QH12 and the Law No. 31/2013/QH13 on amendments to the Law on\r\nValue-added Tax;
The Law on Corporate Income\r\nTax No. 14/2008/QH12 and Law No. 32/2013/QH13 on amendments to the Law on\r\nCorporate Income Tax;
The Government’s\r\nDecree No. 83/2013/ND-CP dated July 22, 2013 on elaboration of implementation\r\nof some Articles of the Law on Tax Administration and the Law on amendments to\r\nsome Articles of the Law on Tax Administration;
The Government’s\r\nDecree No. 65/2013/ND-CP dated June 27, 2013 on elaboration of implementation\r\nof some Articles of the Law on Personal Income Tax and the Law on amendments to\r\nsome Articles of the Law on Personal Income Tax;
The Government’s\r\nDecree No. 209/2013/ND-CP dated December 18, 2013 on guidance on the\r\nimplementation of the Law on Value-added Tax;
The Government’s\r\nDecree No. 218/2013/ND-CP dated December 26, 2013 on guidance on the\r\nimplementation of the Law on Corporate Income Tax;
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The Government's\r\nDecree No. 215/2013/ND-CP dated December 23, 2013 on functions, tasks,\r\nentitlements and organizational structure of the Ministry of Finance;
At the request of the\r\nDirector of the General Department of Taxation,
The Minister of\r\nFinance provides guidance on implementation of Decree No. 91/2014/ND-CP dated\r\nOctober 01, 2014 of the Government on amendments to Decrees on taxation as\r\nfollows:”
- Circular No.\r\n92/2015/TT-BTC on guidelines for VAT and personal income tax incurred by\r\nresidents conducting business, amendments to some Articles on personal income\r\ntax of the Law No. 71/2014/QH13 on amendments to tax laws and the Government's\r\nDecree No. 12/2015/ND-CP dated February 12, 2015 on guidelines for\r\nimplementation of the Law on amendments to Laws and Decrees on taxation is\r\npromulgated pursuant to:
“The Law on\r\nPersonal Income Tax No. 04/2007/QH12 dated November 21, 2007 and the Law No.\r\n26/2012/QH13 dated November 22, 2012 on amendments to the Law on Personal\r\nIncome Tax;
The Law on Tax\r\nAdministration No. 78/2006/QH11 dated November 29, 2006 and the Law No.\r\n21/2012/QH13 dated November 20, 2012 on amendments to the Law on Tax\r\nAdministration;
The Law No.\r\n71/2014/QH13 dated November 26, 2014 on amendments to tax laws;
The Law on Value-added\r\nTax No. 13/2008/QH12 dated June 03, 2008 amended by the Law No. 31/2013/QH13\r\ndated June 19, 2013;
The Government’s\r\nDecree No. 65/2013/ND-CP dated June 27, 2013 on elaboration of some Articles of\r\nthe Law on Personal Income Tax and the Law on amendments to some Articles of\r\nthe Law on Personal Income Tax;
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The Government’s\r\nDecree No. 12/2015/ND-CP dated February 12, 2015 on elaboration of some\r\nArticles of the Law on Tax Administration and the Law on amendments to some\r\nArticles of Laws and Decrees on taxation;
The Government's\r\nDecree No. 209/2013/ND-CP dated December 18, 2013 on guidelines for the Law on\r\nValue-added Tax;
The Government’s\r\nDecree No. 215/2013/ND-CP dated December 23, 2013 on functions, tasks, powers\r\nand organizational structure of the Ministry of Finance;
At the request of the\r\nDirector of the General Department of Taxation;
The Minister of\r\nFinance provides the below guidelines:”
- Government’s Circular No.\r\n25/2018/TT-BTC on guidelines for the Government’s Decree No. 146/2017/ND-CP\r\ndated December 15, 2017 on amendments to some Articles of the Circular\r\nNo.78/2014/TT-BTC dated June 18, 2014 of the Ministry of Finance and Circular\r\nNo.111/2013/TT-BTC dated August 15, 2013 of the Ministry of Finance is\r\npromulgated pursuant to:
“The Law on\r\nSecurities No. 70/2006/QH11 dated June 29, 2006 and Law No. 62/2010/QH12 on\r\namendments to some articles of the Law on Securities dated November 24, 2010;
“The Law on\r\nPersonal Income Tax No. 04/2007/QH12 dated November 21, 2007 and the Law No.\r\n26/2012/QH13 dated November 22, 2012 on amendments to the Law on Personal\r\nIncome Tax;
The Law on Enterprises\r\nNo. 68/2014/QH13 dated November 26, 2014;
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The Law No.\r\n106/2016/QH13 dated April 06, 2016 on amendments to some Articles of the Law on\r\nValue Added Tax, Law on Special Excise Tax and Law on Tax Administration;
The Government’s\r\nDecree No. 65/2013/ND-CP dated June 27, 2013 on elaboration of some Articles of\r\nthe Law on Personal Income Tax and the Law on amendments to some Articles of\r\nthe Law on Personal Income Tax;
The Government’s Decree\r\nNo. 12/2015/ND-CP dated February 12, 2015 on elaboration of some Articles of\r\nthe Law on Tax Administration and the Law on amendments to some Articles of\r\nLaws and Decrees on taxation;
The Government’s\r\nDecree No. 100/2016/ND-CP dated July 01, 2016 on guidelines for the Law on\r\namendments to certain articles of the Law on Value Added Tax, Law on Special\r\nExcise Tax and Law on Tax Administration;
The Government’s\r\nDecree No. 146/2017/ND-CP dated December 15, 2017 on amendments to some\r\narticles of the Government’s Decree No. 100/2016/ND-CP dated July 01, 2016 and\r\nGovernment’s Decree No. 12/2015/ND-CP dated February 12, 2015;
The Government’s\r\nDecree No. 87/2017/ND-CP dated July 26, 2017 on functions, tasks, entitlements\r\nand organizational structure of the Ministry of Finance;
At the request of the\r\nDirector of the General Department of Taxation,
The Minister of\r\nFinance hereby promulgates a Circular on guidelines for the Government’s Decree\r\nNo. 146/2017/ND-CP dated December 12, 2017 on amendments to some articles of\r\nthe Circular No.78/2014/TT-BTC dated June 18, 2014 of the Ministry of Finance\r\nand Circular No.111/2013/TT-BTC dated August 15, 2013 of the Ministry of\r\nFinance. To be specific:”
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This sub-point is amended\r\nby Article 11 of Circular No. 151/2014/TT-BTC on guidance on implementation of\r\nGovernment’s Decree No. 91/2014/ND-CP dated October 01, 2014 on amendments to\r\nDecrees on taxation, which comes into force from November 15, 2014;
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54
“Article 7.\r\nEntry into force
1. This Circular comes\r\ninto force from September 01, 2014.
When an enterprise\r\nneeds time to prepare for the procedures and make the forms provided in\r\nCirculars mentioned in Clause 2 of this Article, it may choose procedures and\r\nforms according to applicable regulations and amended regulations until the end\r\nof October 31, 2014 without notification and registration with the tax\r\nauthority. The General Department of Taxation shall provide instructions on the\r\nimplementation of these regulations.
2. Instructions and\r\nforms provided in the Circular No. 156/2013/TT-BTC dated November 06, 2013,\r\nCircular No. 111/2013/TT-BTC dated August 15, 2013, Circular No.\r\n219/2013/TT-BTC dated December 31, 2013, Circular No. 08/2013/TT-BTC dated\r\nJanuary 10, 2013, Circular No. 85/2011/TT-BTC dated June 17, 2011, Circular No.\r\n39/2014/TT-BTC dated March 31, 2014 and Circular No. 78/2014/TT-BTC dated June\r\n18, 2014 of the Ministry of Finance amended, replaced or annulled by this\r\nCircular are invalidated.
3. Other\r\nadministrative procedures for taxation that are not mentioned in this Circular\r\nshall be implemented according to applicable regulations of law.
Any difficulties that\r\narise during the implementation should be reported to the Ministry of Finance\r\nfor consideration and settlement./.”
- Article 22 of Circular\r\nNo. 151/2014/TT-BTC on guidance on implementation of Government’s Decree No.\r\n91/2014/ND-CP dated October 01, 2014 on amendments to Decrees on taxation,\r\nwhich comes into force from November 15, 2014 stipulates that:
“Article 22.\r\nEntry into force
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Regulations in Chapter\r\nI of this Circular shall be applied to the corporate income tax from 2014.”
- Article 25 of Circular\r\nNo. 92/2015/TT-BTC on guidelines for VAT and personal income tax incurred by\r\nresidents conducting business, amendments to some Articles on personal income\r\ntax of the Law No. 71/2014/QH13 on amendments to tax laws and the Government's\r\nDecree No. 12/2015/ND-CP dated February 12, 2015 on guidelines for\r\nimplementation of the Law on amendments to Laws and Decrees on taxation, which\r\ncomes into force from July 30, 2015 stipulates that:
“Article 25.\r\nEntry into force
1. This Circular comes\r\ninto force from July 30, 2015 and is applied to the tax period 2015 onwards.
Regulations on\r\nbusinesspeople paying flat tax with invoices of tax authorities shall apply to\r\ntax periods from January 01, 2016.
2. Persons who have\r\nlease contracts for many years and have declared and paid tax according to\r\nprevious regulations are not required to adjust the amount of tax declared and\r\npaid.
3. Persons who\r\ntransfer real estate and have applied for registration of right to ownership or\r\nright to use of real estate, or have submitted tax declaration documents before\r\nJanuary 2015 to which 25% tax is applied may apply 2% tax if they have not\r\nreceived any tax notice from the tax authority by December 31, 2014.
4. Points b.2.2,\r\nb.2.3, and b.2.4 Clause 1 of Article 16, Article 22 of Circular No.\r\n156/2013/TT-BTC are annulled.
5. Regulations on VAT\r\nand PIT incurred by businesspeople in Article 16 and Article 21 of Circular No.\r\n156/2013/TT-BTC are annulled.
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7. Point d Clause 6\r\nArticle 2 on PIT on casino prizes of Circular No. 111/2013/TT-BTC is annulled.
8. Sub-departments of\r\ntaxation of districts shall send the lists of business households exempt from\r\nVAT and/or PIT and the lists of business households paying flat tax to the\r\nPeople’s Councils and Fatherland Front Agencies of districts and communes by\r\nAugust 30, 2015. The lists shall also be publicly posted at Sub-departments of\r\ntaxation and the People’s Committees of districts, at the gates or suitable\r\nlocations of the People’s Committees of communes, offices of tax collector\r\nteams, management boards of markets, and at the same time the list using Form\r\nNo. 01/CKTT-CNKD issued together with\r\nthis Circular shall be publicly sent to each businessperson. The list using\r\nForm No. 01/CKTT-CNKD shall be made according to guidance in Point a.1 Clause 9\r\nArticle 6 of this Circular.
Any difficulties that\r\narise during the implementation should be reported to the Ministry of Finance\r\n(the General Department of Taxation) for consideration and settlement./.
- Article 5 of\r\nGovernment’s Circular No. 25/2018/TT-BTC on guidelines for the Government’s\r\nDecree No. 146/2017/ND-CP dated December 15, 2017 on amendments to some\r\nArticles of the Circular No.78/2014/TT-BTC dated June 18, 2014 of the Ministry\r\nof Finance and Circular No.111/2013/TT-BTC dated August 15, 2013 of the\r\nMinistry of Finance, which comes into force from May 01, 2018 stipulates that:
“Article 5.\r\nEntry into force
1. This Circular comes\r\ninto force from May 01, 2018.
2. Cases that arise\r\nfrom February 01, 2018 and are covered the Decree No. 146/2017/ND-CP shall\r\ncomply with the Decree No. 146/2017/ND-CP and Article 1, Article 2 and Clauses\r\n2, 3 and 4 Article 3 of this Circular.
3. Any difficulties\r\nthat arise during the implementation should be reported to the Ministry of\r\nFinance for consideration and settlement./.”
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1. People’s Committees\r\nof provinces and central-affiliated cities shall direct regulatory agencies to\r\ncomply with regulations of the Government and guidance of the Ministry of\r\nFinance.
2. Tax authorities are\r\nresponsible for providing guidance for organizations or individuals to comply\r\nwith regulations of this Circular.
3. Regulated entities\r\nof this Circular shall comply with regulations of this Circular.
Any difficulties that\r\narise during the implementation should be reported to the Ministry of Finance\r\nfor consideration and settlement./.”
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File gốc của Integrated document No. 68/VBHN-BTC dated December 19, 2019 Circular on guidelines for implementation of the Law on Personal Income Tax, the Law on amendments to the Law on Personal Income Tax, and the Government’s Decree No. 65/2013/ND-CP on elaboration of some Articles of the Law on Personal Income Tax and the Law on amendment đang được cập nhật.
Integrated document No. 68/VBHN-BTC dated December 19, 2019 Circular on guidelines for implementation of the Law on Personal Income Tax, the Law on amendments to the Law on Personal Income Tax, and the Government’s Decree No. 65/2013/ND-CP on elaboration of some Articles of the Law on Personal Income Tax and the Law on amendment
Tóm tắt
| Cơ quan ban hành | |
| Số hiệu | 68/VBHN-BTC |
| Loại văn bản | Văn bản hợp nhất |
| Người ký | |
| Ngày ban hành | 2019-12-19 |
| Ngày hiệu lực | 2019-12-19 |
| Lĩnh vực | |
| Tình trạng | Còn hiệu lực |