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Vietnam

Financial Year – 1 January – 31 December
Currency – Vietnamese dong (VND)

Corporate Tax Summary

Residence – A company is resident in Vietnam if it is incorporated in Vietnam or, if not incorporated in Vietnam, it carries on business in Vietnam.

Basis of Taxation – Companies are taxed on income incurred in Vietnam. Taxable income is calculated as revenue minus deductible expenses plus other incomes.

Reference
Corporate Income Tax Rate (%) 20%
Branch Tax Rate (%) N/A
Withholding Tax Rate:
Dividends – Franked 5%
Dividends – Unfranked 20%
Dividends – Conduit Foreign Income N/A
Interest 5% In general, this is a final withholding tax that is imposed on payments to non-residents only.
Royalties from Intellectual Property 10%
Fund Payments from Managed Investment Trusts N/A
Branch Remittance Tax N/A
Net Operating Losses (Years)
Carry Back Carry back of losses is not permitted.
Carry Forward Losses may be carried forward fully and consecutively for a period of five years.

Individual Tax Summary

Residence – For tax purposes, an individual is a resident if he/she meets one of the conditions below:

a) He/she has been present in Vietnam for at least 183 days in a calendar year, or for 12 consecutive months from the first day of his/her presence in Vietnam (the date of arrival and date of departure are considered as one day). The date of arrival and date of departure is taken as the certification of the immigration agency on the passport (or laissez-passers) when that person enters and leaves Vietnam. If the person enters and leaves Vietnam within one day, it will be considered a day of residence.
A person is defined as being “in Vietnam” if they are present in the territory of Vietnam.

b) He/she has a regular residence in Vietnam in one of the following cases:

b.1) He/she has a regular residence according to the regulations of the law on residence.

b.1.1) For Vietnamese citizens: A place where that person regularly, permanently and indefinitely lives and has been registered as a permanent residence as prescribed by the regulations of the law on residence.

b.1.2) For foreigners: The permanent residence written in the permanent residence card or the temporary residence when applying for the temporary residence card issued by a competent authority affiliated to the Ministry of Public Security.

b.2) He/she rents a house in Vietnam according to the regulations of the law on housing under a contract that has a term of at least 183 days in the tax year. Specifically:

b.2.1) A person who has no regular residence as defined in b.1.1 above will be considered a resident if he/she has a total house lease period of at least 183 days in the tax year under various lease contracts, even if a he/she rents houses in different locations.

b.2.2) The rented houses can be hotels, guesthouses, motels, offices, etc. whether they are rented by the person or their employer.

If the person has a regular residence in Vietnam according to these conditions but his/her actual presence in Vietnam is shorter than 183 days in the tax year and he/she fails to prove his or her residence in any other country, that person will be considered a resident of Vietnam. Residency in another country shall be proved by a certificate of residence. If the person is a citizen of a country or territory that has signed a tax agreement with Vietnam and does not issue a certificate of residence, that person shall present a photocopy of the passport to prove the period of residence.

A non-resident is a person who fails to meet any of the conditions specified above.

Basis of Taxation – Resident taxpayers are generally taxed on worldwide income, using a progressive tax table. Non-resident taxpayers are taxed on income incurred in Vietnam. The tax rate is 20%

Filing Status – Each taxpayer must file a separate return each financial year.

Personal Income Tax Rates

Taxable Income (million VND) Tax Payable – Residents Tax Payable – Non Residents
Up to 5 0 + 5% 20% regardless of the level of taxable income
5 – 10 0.25 million + 10%
10 – 18 0.75 million + 15%
18 – 32 1.95 million + 20%
32 – 52 4.75 million + 25%
52 – 80 9.75 million + 30%
More than 80 18.15 million + 35%

Goods and Services Tax (GST)

Rate 10/0%
Taxable Transactions GST is a transaction based, value added tax on the inputs and outputs of an organisation’s business activities.
Registration An entity that carries on an enterprise must register for GST. Some individual traders do not have to register, including street traders, petty traders, petty food traders, consignment traders, movable businesses etc.
Filing and Payment Each GST registered entity must account for its GST obligations on a Business Activity Statement for each tax period.
VAT taxpayers with a total revenue of VND 50 billion or less from the sale of goods and/or services in the preceding year shall be eligible to declare VAT quarterly.
Taxpayers who have just started their business shall declare VAT quarterly. In the calendar year following 12 months of business, VAT declarations shall be made monthly or quarterly depending on the revenue from the sale of goods and/or services in the preceding calendar year (12 months).

Other Taxes Payable

Tax Reference
Payroll Tax Taxable income (million VND) per month for residents and non residents:
Up to 5: 0 + 5%
5 – 10: 0.25 + 10%
10 – 18: 0.75 + 15%
18 – 32 :1.95 + 20% 20%
32 – 52: 4.75 + 25%
52 – 80: 9.75 + 30%
Above 80: 18.15 + 35%
Stamp Duty The states and territories impose stamp duty at rates of up to 10% on the transfer of real property and some other business property. Rates vary depending on the class of business property transferred.
Land Tax 0.5% on the transfer of land

Last updated: 10.06.2020