Intergrated Document No. 28/VBHN-VPQH dated February 26, 2025 Law on personal income tax

THE OFFICE OF THE NATIONAL ASSEMBLY --------	SOCIALIST REPUBLIC OF VIETNAM Independence - Freedom – Happiness ---------------
No. 28/VBHN-VPQH	Hanoi, February 26, 2025

 

LAW

ON PERSONAL INCOME TAX

The Law on Personal Income Tax No. 04/2007/QH12 dated November 21, 2007 of the National Assembly, effective as of January 1, 2009, as amended by:

1. Law No. 26/2012/QH13 dated November 22, 2012 of the National Assembly on amendments to the Law on Personal Income Tax, effective as of July 1, 2013;

2. Law No. 71/2014/QH13 dated November 26, 2014 of the National Assembly on amendments to various laws on taxation, effective as of January 1, 2015;

3. Law on Land No. 31/2024/QH15 dated January 18, 2024 of the National Assembly, effective as of August 1, 2024[1];

4. Law No. 43/2024/QH15 dated June 29, 2024 of the National Assembly on amendments to the Law on Land No. 31/2024/QH15, the Law on Housing No. 27/2023/QH15, the Law on Real Estate Business No. 29/2023/QH15, and the Law on Credit Institutions No. 32/2024/QH15, effective as of August 1, 2024;

5. Law on Value-Added Tax No. 48/2024/QH15 dated November 26, 2024 of the National Assembly, effective as of July 1, 2025;

6. Law No. 56/2024/QH15 dated November 29, 2024 of the National Assembly on amendments to the Law on Securities, the Law on Accounting, the Law on Independent Audit, the Law on State Budget, the Law on Management and Use of Public Property, the Law on Tax Administration, the Law on Personal Consumption Tax, the Law on National Reserve, and the Law on Handling of Administrative Violations, effective as of January 1, 2025.

Pursuant to the Constitution of the Socialist Republic of Viet Nam in 1992, as amended under Resolution No. 51/2001/QH10;

The National Assembly hereby promulgates the Law on Personal Income Tax[2].

Chapter I

GENERAL PROVISIONS

Article 1. Scope

This Law provides for taxpayers, taxable incomes, tax-exempt incomes, tax reduction, and the basis for calculating personal income tax.

Article 2. Taxpayers

1. Taxpayers of personal income tax include resident individuals earning taxable income as prescribed in Article 3 of this Law arising within and outside the territory of Viet Nam and non-resident individuals earning taxable income as prescribed in Article 3 of this Law arising within the territory of Viet Nam.

2. A resident individual is a person who meets one of the following conditions:

a) Being present in Viet Nam for 183 days or more in a calendar year or for 12 consecutive months from the date of first arrival in Viet Nam;

b) Having a permanent residence in Viet Nam, including a registered place of permanent residence; or a leased house in Viet Nam with a term as stated in a lease contract.

3. A non-resident individual is a person who does not satisfy the conditions specified in Clause 2 of this Article.

Article 3. Taxable income

Taxable income subject to personal income tax includes the following types of income, except for tax-exempt incomes specified in Article 4 of this Law:

1.[3] Income from business, including:

a) Income from the production and trading of goods or services;

b) Income from practicing an independent profession by an individual holding a practicing license or certificate in accordance with law.

Business income under this Clause does not include income from households or individuals engaged in production or business activities with annual revenue below the threshold prescribed in Clause 25 Article 5 of the Law on Value-Added Tax.

2.[4] Income from wages and remuneration, including:

a) Salaries, wages, and amounts of similar nature;

b) Allowances and subsidies, excluding: allowances and subsidies under regulations on preferential treatment for persons with meritorious services; national defense or security allowances; hazardous or dangerous job allowances; region-based, hardship, or attraction allowances as prescribed by law; unexpected hardship allowance; compensation for occupational accidents and diseases; lump-sum allowance upon childbirth or adoption, allowance due to reduced working capacity, lump-sum retirement allowance; monthly survivor benefits and other allowances as prescribed by the law on social insurance; severance allowance, job loss allowance as prescribed by the Labor Code; social protection allowances and other allowances and subsidies that are not of a wage or salary nature as prescribed by the Government.”

3. Income from capital investment, including:

a) Interest from loans;

b) Dividends;

c) Income from capital investment in other forms, except interest income from Government bonds.

4. Income from capital transfer, including:

a) Income from transfer of capital holdings in economic organizations;

b) Income from transfer of securities;

c) Income from capital transfer in other forms.

5.[5] Income from real estate transfer, including:

a) Income from transfer of land use rights and property on land;

b) Income from transfer of ownership or use rights of residential housing;

c) Income from transfer of land lease rights or water surface lease rights;

d) Other income derived from the transfer of real estate in any form.

6. Income from winnings, including:

a) Lottery winnings;

b) Promotional winnings;

c)[6] Winnings from betting activities;

d) Winnings from games, contests with prizes, and other forms of prizes.

7. Income from royalties, including:

a) Income from the transfer or licensing of intellectual property rights;

b) Income from technology transfer.

8. Income from franchising.

9. Income from inheritance, including: securities, capital holdings in economic organizations, business establishments, real estate, and other assets subject to ownership or use right registration.

10. Income from gifts, including: securities, capital holdings in economic organizations, business establishments, real estate, and other assets subject to ownership or use right registration.

The Government shall provide detailed regulations and guidance on the implementation of this Article.

Article 4. Tax-exempt income

1. Income from real estate transfers between husband and wife; parents and their biological or adopted children; parents-in-law and children-in-law; grandparents and grandchildren; and between biological siblings.

2. Income from transfer of residential houses, land use rights and property on residential land, provided that the individual owns only one house or land parcel.

3. Income from the value of land use rights granted by the State.

4. Inheritance or gifts in the form of real estate between husband and wife, parents and children (biological or adopted), parents-in-law and children-in-law; grandparents and grandchildren; and between biological siblings.

5. Income of households or individuals directly engaged in agricultural, forestry, salt production, aquaculture, or fishing activities that are unprocessed or only simply pre-processed.

6. Income from conversion of agricultural land use rights allocated by the State to households or individuals.

7. Interest income from deposits at credit institutions and income from life insurance contracts.

8. Income from remittances.

9. The portion of wages for night shifts or overtime that is paid at a higher rate than wages for regular daytime working hours in accordance with the law.

10.[7] Retirement pensions paid by the Social Insurance Fund or monthly pensions paid by voluntary pension funds.

11. Scholarship income, including:

a) Scholarships funded by the state budget;

b) Scholarships from domestic or foreign organizations under their scholarship programs.

12. Income from compensation under life or non-life insurance contracts, compensation for labor accidents, state compensation, and other compensation as prescribed by law.

13. Income from charity funds established or recognized by competent state agencies operating for charitable, humanitarian, and non-profit purposes.

14. Income from foreign aid for humanitarian or charitable purposes in both governmental and non-governmental forms approved by competent state agencies.

15.[8] Wages and remuneration of Vietnamese seafarers working for foreign shipping companies or Vietnamese companies engaged in international transport.

16.[9] Income of individuals who are shipowners, individuals with the right to use ships, and individuals working on ships from the provision of goods and services directly serving offshore fishing activities.

Article 5. Tax reduction

Taxpayers who suffer from natural disasters, fire, accidents, or serious illnesses affecting their ability to pay taxes may be eligible for tax reduction corresponding to the level of damage but not exceeding the amount of tax payable.

Article 6. Conversion of taxable income into Vietnamese dong

1.[10] Taxable income received in foreign currency shall be converted into Vietnamese dong at the average interbank exchange rate published by the State Bank of Viet Nam at the time the income arises.

2. Taxable income not received in cash shall be converted into Vietnamese dong based on the market price of the relevant goods or services, or equivalent goods or services, at the time the income arises.

Article 7. Tax period

1. The tax period for resident individuals is specified as follows:

a) The annual tax period applies to income from business activities and income from wages and remuneration;

b) The per-transaction tax period applies to income from capital investment; income from capital transfer, except for income from securities transfer; income from real estate transfer; income from winnings; income from royalties; income from franchising; income from inheritance; and income from gifts;

c)[11] The tax period for income from securities transfer shall be determined either per transaction or on an annual basis.

2. The tax period for non-resident individuals shall be determined on a per-transaction basis for all taxable income.

Article 8. Tax administration and tax refund

1. Tax registration, declaration, withholding, payment, finalization, refund, handling of tax law violations, and other tax administration measures shall be carried out in accordance with the Law on Tax Administration.

2. Individuals are entitled to a tax refund in the following cases:

a) The amount of tax paid exceeds the payable tax amount;

b) The individual has paid tax but has taxable income that is below the threshold for tax liability;

c) Other cases as decided by competent state authorities.

Article 9. Application of international treaties

Where an international treaty to which the Socialist Republic of Viet Nam is a signatory provides for personal income tax in a manner different from the provisions of this Law, the provisions of such international treaty shall prevail.

Chapter II

BASIS FOR PERSONAL INCOME TAX CALCULATION FOR RESIDENT INDIVIDUALS

Section 1. DETERMINATION OF TAXABLE INCOME AND ASSESSABLE INCOME

Article 10. Tax on business individuals[12]

1. Business individuals shall pay personal income tax as a percentage of revenue, depending on the specific sector or line of business.

2. Revenue is the total amount earned from the sale of goods, processing services, commissions, and provision of services arising during the tax period from production and business activities involving goods and services.

Where the business individual cannot determine their revenue, the tax authority shall determine the revenue in accordance with the Law on Tax Administration.

3. Tax rates:

a) Goods distribution and supply: 0,5%;

b) Services, construction without provision of materials: 2%.

For property leasing, insurance agency, lottery agency, and multi-level marketing: 5%;

c) Manufacturing, transportation, services associated with goods, construction with provision of materials:  1,5%;

d) Other business activities: 1%.

Article 11. Taxable income from wages and remuneration

1. Taxable income from wages and remuneration is the total amount of income specified in Clause 2 Article 3 of this Law received by the taxpayer during the tax period.

2. The point in time for determining taxable income from wages and remuneration shall be the time the income is paid by the organization or individual or the time the taxpayer receives the income.

Article 12. Taxable income from capital investment

1. Taxable income from capital investment is the total income from capital investment as specified in Clause 3 Article 3 of this Law received by the taxpayer during the tax period.

2. The point in time for determining taxable income from capital investment shall be the time the income is paid by the organization or individual or the time the taxpayer receives the income.

Article 13. Taxable income from capital transfer[13]

1. Taxable income from capital transfer is determined as the sale price minus the purchase price and reasonable expenses related to the generation of the capital transfer income.

For securities transfers, taxable income shall be determined based on the transfer price per transaction.

2. The time of determination of taxable income from capital transfer is the time the capital transfer transaction is completed in accordance with the law.

The Government shall provide detailed regulations and guidance on the implementation of this Article.

Article 14. Taxable income from real estate transfer[14]

1.[15] Taxable income from real estate transfer is determined based on the transfer price of each transaction; in the case of land use right transfer, the taxable income shall be calculated based on the land price stated in the land price table.

2. The Government shall stipulate the principles and methods for determining the transfer price of real estate.

3. The time of determination of taxable income from real estate transfer is the time the transfer contract takes legal effect in accordance with the law.

Article 15. Taxable income from winnings

1. Taxable income from winnings is the portion of the prize value exceeding VND 10 million received by the taxpayer per each winning instance.

2. The time of determination of taxable income from winnings is the time the organization or individual pays the income to the taxpayer.

Article 16. Taxable income from royalties

1. Taxable income from royalties is the portion of income exceeding VND 10 million received by the taxpayer under each contract for the transfer or licensing of intellectual property rights or technology transfer.

2. The time of determination of taxable income from royalties is the time the organization or individual pays the income to the taxpayer.

Article 17. Taxable income from franchising

1. Taxable income from franchising is the portion of income exceeding VND 10 million received by the taxpayer under each franchising contract.

2. The time of determination of taxable income from franchising is the time the organization or individual pays the income to the taxpayer.

Article 18. Taxable income from inheritance and gifts

1. Taxable income from inheritance and gifts is the portion of the value of the inherited or gifted assets exceeding VND 10 million received by the taxpayer for each instance.

2. The time of determination of taxable income is specified as follows:

a) For income from inheritance: the time the taxpayer receives the inherited assets;

b) For income from gifts: the time the organization or individual gives the gift to the taxpayer, or the time the taxpayer receives the income.

Article 19. Family circumstance-based deductions

1.[16] Family circumstance-based deduction is the amount deducted from taxable income before tax calculation for income from business, wages, and remuneration of resident individuals.  It includes:

a) Deduction for the taxpayer: VND 9 million/month (VND 108 million/year);

b) Deduction for each dependent: VND 3.6 million/month.

In case the consumer price index (CPI) fluctuates by more than 20% compared to the effective date of this Law or the most recent adjustment of family circumstance-based deductions, the Government shall submit to the Standing Committee of the National Assembly a proposal to adjust the deduction levels accordingly, to be applied in the next tax period.

2. Family circumstance-based deduction for dependents shall be applied on the principle that each dependent shall only be counted for deduction once for one taxpayer.

3. A dependent is a person for whom the taxpayer has a financial support obligation, including:

a) Minor children; disabled children incapable of working;

b) Individuals without income or with income not exceeding the level prescribed by law, including: adult children in university, college, or vocational training; spouse incapable of working; parents who are beyond working age or incapable of working; others with no source of support whom the taxpayer is directly responsible for supporting.

The Government shall stipulate the income threshold and declaration requirements for determining dependents eligible for family circumstance-based deductions.

Article 20. Deductions for charitable and humanitarian contributions

1.[17] Charitable and humanitarian contributions shall be deducted from income prior to tax calculation for income from business, wages, and remuneration of resident individuals, including:

a) Contributions to organizations and establishments that care for orphans, people with disabilities, or the elderly with no place of residence;

b) Contributions to charitable funds, humanitarian funds, or study promotion funds.

2. Organizations, establishments, and funds specified in points a and b of Clause 1 of this Article must be established or recognized by competent state agencies, operating for charitable, humanitarian, or educational promotion purposes, and not for profit.

Article 21. Assessable income

1.[18] The assessable income for income from business, wages, and remuneration is the total taxable income as specified in Articles 10 and 11 of this Law, minus: social insurance, health insurance, unemployment insurance, mandatory occupational liability insurance contributions (for professions required to participate), voluntary pension fund contributions, family circumstance-based deductions under Article 19, and charitable/humanitarian deductions under Article 20.

The Government shall provide for the maximum deductible amount for voluntary pension fund contributions.

2. The assessable income for income from capital investment, capital transfer, real estate transfer, winnings, royalties, franchising, inheritance, and gifts is the taxable income specified in Articles 12, 13, 14, 15, 16, 17, and 18 of this Law.

Section 2. TAX SCHEDULE

Article 22. Progressive tax schedule by tiers

1. The progressive tax schedule by tiers shall apply to the assessable income specified in Clause 1, Article 21 of this Law.

2. The progressive tax schedule is as follows:

Tax bracket	Annual taxable income (million VND)	Monthly taxable income (million VND)	Tax rate (%)
1	Up to 60	Up to 5	5
2	Over 60 to 120	Over 5 to 10	10
3	Over 120 to 216	Over 10 to 18	15
4	Over 216 to 384	Over 18 to 32	20
5	Over 384 to 624	Over 32 to 52	25
6	Over 624 to 960	Over 52 to 80	30
7	Above 960	Above 80	35

Article 23. Fixed tax schedule

1. The fixed tax schedule shall apply to the assessable income specified in Clause 2, Article 21 of this Law.

2.[19] The fixed tax rates are as follows:

Taxable income type	Tax rate (%)
a) Income from capital investment	5
b) Income from royalties, franchising	5
c) Income from winnings	10
d) Income from inheritance, gifts	10
dd) Income from capital transfer as prescribed in clause 1 Article 13 of this Law	20
Income from securities transfer as prescribed in clause 1 Article 13 of this Law	0,1
e) Income from real estate transfer	2

Article 24. Responsibilities of income-paying organizations/individuals, e-commerce platform operators, digital platform operators with payment functions, and other digital economy actors; responsibilities of resident individual taxpayers[20]

1. Responsibilities for tax declaration, withholding, payment, and finalization are prescribed as follows:

a) Organizations and individuals paying income shall declare, withhold, pay tax to the state budget, and finalize personal income tax with respect to taxable income paid to taxpayers;

a1)[21] Organizations that are operators of e-commerce platforms or digital platforms with payment functions, and other entities engaged in digital economic activities as prescribed by the Government, shall withhold and pay tax on behalf of taxpayers and declare the withheld tax for business transactions conducted by households or individuals on such platforms;

b) Individuals with taxable income shall declare, pay tax to the state budget, and finalize tax in accordance with the law.

2. Organizations and individuals paying income shall provide information on the income paid and dependents of taxpayers under their management as prescribed by law.

3. The Government shall provide for the appropriate tax withholding rates for each type of income mentioned in point a, clause 1 of this Article and for the procedures of tax finalization.

Chapter III

BASIS FOR TAX CALCULATION FOR NON-RESIDENT INDIVIDUALS

Article 25. Tax on income from business

1. Tax on business income of a non-resident individual shall be calculated by multiplying the revenue from business activities prescribed in clause 2 of this Article by the tax rates specified in clause 3 of this Article.

2. Revenue means the total amount arising from the provision of goods or services, including costs paid by the buyer on behalf of the non-resident individual that are not reimbursed.

If the contract does not specify that personal income tax is included, the taxable revenue shall be the total amount received by the non-resident individual in any form from the provision of goods or services in Viet Nam, regardless of where the business activity is conducted.

3. The tax rates applicable to business income shall be specified for each sector and line of business as follows:

a) 1% for trading of goods;

b) 5% for provision of services;

c) 2% for manufacturing, construction, transportation, and other business activities.

Article 26. Tax on income from wages and remuneration

1. Tax on wage and remuneration income of non-resident individuals shall be calculated by multiplying the taxable income as prescribed in clause 2 of this Article by a flat rate of 20%.

2. Taxable income from wages and remuneration is the total amount of salaries and wages earned by non-resident individuals for performing work in Viet Nam, regardless of where the income is paid.

Article 27. Tax on income from capital investment

Tax on capital investment income of non-resident individuals shall be calculated by multiplying the total income received from investing in Vietnamese organizations or individuals by a tax rate of 5%.

Article 28. Tax on income from capital transfer

Tax on income from capital transfer by non-resident individuals shall be calculated by multiplying the total amount received from transferring capital in Vietnamese organizations or individuals by a tax rate of 0.1%, regardless of whether the transfer is conducted inside or outside Viet Nam.

Article 29. Tax on income from real estate transfer

Tax on income from real estate transfer in Viet Nam by non-resident individuals shall be calculated by multiplying the transfer price by a tax rate of 2%.

Article 30. Tax on income from royalties and franchising

1. Tax on royalty income of non-resident individuals shall be calculated based on the portion of income exceeding VND 10 million per contract for the transfer or licensing of intellectual property rights or technology in Viet Nam, multiplied by a tax rate of 5%.

2. Tax on income from franchising for non-resident individuals shall be calculated based on the portion of income exceeding VND 10 million under each franchising contract in Viet Nam, multiplied by a tax rate of 5%.

Article 31. Tax on income from winnings, inheritance, and gifts

1. Tax on income from winnings, inheritance, and gifts of non-resident individuals shall be calculated by multiplying the taxable income specified in Clause 2 of this Article by a tax rate of 10%.

2. Taxable income from winnings is the portion of the prize value exceeding VND 10 million per each winning event in Viet Nam. Taxable income from inheritance and gifts is the portion of the value of inherited or gifted assets exceeding VND 10 million per each instance of income received in Viet Nam.

Article 32. Time of determining taxable income

1. The time of determining taxable income for the income specified in Article 25 of this Law is the time when the non-resident individual receives the income or when the invoice for sale of goods or provision of services is issued.

2. The time of determining taxable income for the income specified in Articles 26, 27, 30, and 31 of this Law is the time when the organization or individual in Viet Nam pays income to the non-resident individual, or the time the non-resident receives income from a foreign organization or individual.

3. The time of determining taxable income for the income specified in Articles 28 and 29 of this Law is the time when the transfer contract takes legal effect.

Article 33. Responsibilities of income-paying organizations and individuals; e-commerce platform operators; digital platform operators with payment functions; other digital economy entities; and responsibilities of non-resident individual taxpayers[22]

1. Organizations and individuals paying income shall withhold and remit tax to the state budget on a per-transaction basis for taxable income paid to taxpayers.

2. Organizations that are operators of e-commerce platforms, digital platforms with payment functions, and other digital economy entities as prescribed by the Government shall withhold and pay tax on behalf of taxpayers, and declare the withheld tax amount for transactions conducted by households and individuals on such platforms.

3. Non-resident individual taxpayers shall declare and pay tax on their taxable income in accordance with the Law on Tax Administration.

Chapter IV

IMPLEMENTATION[23]

Article 34. Entry into force

1. This Law enters into force on January 1, 2009.

2. The following legislative documents shall be repealed:

a) Ordinance on Income Tax on High-Income Earners No. 35/2001/PL-UBTVQH10, as amended under Ordinance No. 14/2004/PL-UBTVQH11;

b) Law on Land Use Rights Transfer Tax dated June 22, 1994, as amended under Law No. 17/1999/QH10;

c) Provisions on corporate income tax applicable to individuals engaged in production and business activities, excluding private enterprises, under the Law on Corporate Income Tax No. 09/2003/QH11;

d) Other provisions on personal income taxation contrary to this Law.

3. Income of individuals eligible for tax incentives under legal normative documents issued before the effective date of this Law shall continue to enjoy such incentives.

Article 35. Implementation guidelines

The Government shall provide detailed regulations and guidance on the implementation of this Law./.

 

AUTHENTICATION OF CONSOLIDATED DOCUMENT CHAIRPERSON Le Quang Tung