Personal income tax is a tax calculated on an individual’s income sources earned from business activities and other sources such as salaries and wages paid by employers, from capital investments, capital transfer, real estate transfer, prize-winning, copyright, and inheritance gifts. Regardless of Vietnamese or foreigners, depending on residence status, and income level, an individual may have to pay from 5% to 35% of the income earned… Among them, income from salary and wages is the most common and also has the most detailed regulations.
NOTES ON ANNUAL PERSONAL INCOME TAX SETTLEMENTS – 2023
Who should directly declare and do annual tax settlements to the tax authority?
In Vietnam, the deadline for submitting annual tax finalization documents is the last day of the 3rd month from the end of the calendar year or fiscal year.
- Expats who work under contracts for more than 3 months in one place and have income in another place with an average monthly income of over 10 million/year even though 10% has been deducted.
- Resident individuals have income from salaries and wages paid by organizations and individuals from abroad.
- Resident individuals have income from salaries and wages paid by international organizations, Embassies, and Consulates in Vietnam but have not yet made tax deductions and declared taxes directly to tax authorities.
Global tax incomes from wages and remunerations of expats who are resident in Vietnam?
Upon resident or non-resident status in Vietnam in a calendar year, an expat should declare settlements of PIT for the incomes inside Vietnam or global incomes. Taxable amount / tax rates for resident and non-resident are completely different:
- In case an expat is resident in Vietnam, he or she shall declare global income and pay personal income tax with progressive tax rates from 5% to 35%
- In case an expat is non-resident in Vietnam, he or she just pays 20% personal income tax for what they earned in Vietnam.
- To avoid special inspection on global incomes in Vietnam and any income from countries that have tax agreements with Vietnam, the foreign experts who are working in Vietnam shall declare reasonable global incomes, which must be fair with the positions, working histories, GDP of expats’ nations, reputation and actual business result of the employers…
Other tax incomes of investors – managers – experts in Vietnam?
- Tax on capital transfer.
- Tax on capital investment.
- Tax on real estate transfer.
- Tax on winning prizes.
- Tax on copyright.
- Tax on franchising.
- Tax on inheritance.
- Tax on receipt of gifts.
NOTES ON THE REQUIRED COMPLIANCES
- Investment visa, Business visa…
- Work permits | Labor contracts | Employee profile according to local labor laws.
- Temporary resident card.
- Compulsory insurance.
- Driving license.
- Exclusive advice for the Chief of the representative office and Legal representative in Vietnam.
- Update the latest local regulations and practice solutions to protect and optimize your interests.
Foreign experts who are working in Vietnam under titles such as managers, investors, legal representative, chief of representative offices shall be complied with the local laws and regulations to avoid and prevent violations in advance, keep their good standing in optimal manners whenever they are working and doing business in Vietnam.
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VIVA keeps its signature by offering one-stop business platform with regard to market entry and the mandatory business compliances. We ensure for our client’s good standing, in lawful and optimal manners whenever they are working and doing business in Vietnam.
- Personal income tax in Vietnam – comprehensive guide to finalization procedures 2023
- Notes on your annual personal income tax settlement
- Non-taxable – condition for personal income tax exemption and non-taxable (part 1)
- Non-taxable – condition for personal income tax exemption and non-taxable (part 2)
- Foreign managers and experts in Vietnam – manage the local required compliance procedures
- Foreigners in Vietnam evisa – new regulation on entry and exit
- Electronic visas in Vietnam (E-visa)
- Expats working in Vietnam – what you shall keep in mind
- Chief of representative office or head of branch in Vietnam – role and responsibility