Circular No. 111/2013/TT-BTC of August 15, 2013

/// This Circular takes effect on October 01, 2013.

/// The regulations on personal income tax in the Law on the amendments to the Law on Personal income tax, and the Decree No. 65/2013/NĐ-CP from the effective date of the Law and Decree (July 01, 2013).

/// The guidance on personal income tax in the Circular No. 84/2008/TT-BTC dated September 30, 2008, Circular No. 10/2009/TT-BTC dated January 21, 2009, Circular No. 42/2009/TT-BTC dated March 09, 2009, Circular No. 62/2009/TT-BTC dated March 27, 2009, Circular No. 161/2009/TT-BTC dated August 12, 2009, Circular No. 164/2009/TT-BTC dated August 13, 2009, Circular No. 02/2010/TT-BTC dated January 11, 2010, Circular No. 12/2011/TT-BTC dated January 26, 2011, Circular No. 78/2011/TT-BTC dated June 08, 2011, Circular No. 113/2011/TT-BTC dated August 04, 2011 of the Ministry of Finance are abolished.

/// The guidance on personal income tax that are provided by the Ministry of Finance before this Circular takes effect and at odds with the guidance in this Circular are abolished.

Decree No. 65/2013/ND-CP detailing the Law on Personal Income Tax 2013

Article 1. Scope of regulation

This Decree details and guides a number of articles of the Law on personal income tax and Law amending and supplementing a number of articles of the Law on personal income tax.

Article 2. Taxpayers

1. PIT payers include resident and non-resident individuals who earn taxable incomes specified in Article 3 of the Law on personal Income Tax and Article 3 of this Decree.  Scope to define taxable income of taxpayers shall be as follows:

a) For resident individuals, their taxable incomes are incomes earned inside and outside the Vietnamese territory, regardless of where their incomes are paid;
b) For non-resident individuals, their taxable incomes are incomes earned in Vietnam, regardless of where their incomes are paid.

2. A resident individual means a person who satisfies any of the following conditions:

a) Being present in Vietnam for 183 days or more in a calendar year or 12 consecutive months counting from the first date of his/her presence in Vietnam;
Individuals present in Vietnam under this Point means those whose presence is in the Vietnamese territory.
b) Having a place of habitual residence in Vietnam in either of the following two cases:
– Having a registered place of permanent residence under the law on residence;
– Having a rented house for dwelling in Vietnam under the law on housing, under a rent contract with a term of 183 days or more in a tax year.
In case an individual has a place of permanent residence in Vietnam as prescribed in this point but he/she actually presents in Vietnam less than 183 days in tax year and he/she fail to prove that he/she is resident person of other country, so he/she will be considered as resident person in Vietnam.

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

Please download entire Decree No. 65/2013/ND-CP here

Law on Personal Income Tax amending and supplementing

Pursuant to the 1992 Constitution of the Socialist Republic of Vietnam, which was amended and supplemented a number of articles  under the Resolution No. 51/2001/QH10;

The National Assembly promulgates the Law on amending and supplementing a number of articles of the Law on personal income tax No. 04/2007/QH12,

Article 1.

To amend and supplement a number of articles of the Law on personal income tax:
1. Clause 2 and clause 5 of Article 3 are amended and supplemented as follows:
“2. Incomes from salaries and wages, including:
a) Salaries, wages and amounts of similar nature;
b) Allowances, subsidies, except for amounts: Those paid under legal provisions on preferential treatment of persons with meritorious services; defense or security allowances; hazard or danger allowances for persons working in branches, occupations or jobs at places where exist hazardous or dangerous elements; allowances for attraction of laborers to work in certain branches or in certain regions specified by law; allowances for sudden difficulties, allowances for laborers having labor accident or suffering from occupational disease, lump-sum maternity or child adoption allowances; allowances for working capacity loss, lump-sum retirement allowances, monthly survivorship allowances and other allowances as prescribed by law on social insurance; , severance and job-loss allowances specified in the Labor Code; subsidies of social relief nature and other allowances, subsidies without nature of salaries, wages as prescribed by the Government.”

“5. Incomes from transfer of real estate, including:
a) Incomes from transfer of rights to use land and assets attached to land;
b) Incomes from transfer of right to own or use residential houses;
c) Incomes from transfer of right to lease land or water surface;
d) Other incomes earned from transfer of real estate under any form.”

Please download entire law on personal income tax here PIT

Circular No. 186/2010/TT-BTC providing the guidance of the offshore remittance of profits

On 18 November 2010, The Ministry of Finance issued Circular No. 186/2010/TT-BTC “Circular 186”, providing the guidance of the offshore remittance of profits earned by foreign organizations and individuals from their direct investment in Vietnam under the Investment Law. Circular 186 replaces Circular No. 124/2004/TT-BTC dated 23 December 2004 “Circular 124”.

We set out below some of the most important changes contained in Circular 186:

. Circular 186 only applies to the remittance of profits earned from direct investment and does not cover indirect investment activities in Vietnam.

. According to Circular 186, the foreign investors have fewer timing to transfer abroad the profits earned. Those chances for a foreign investor to transfer abroad the profits (temporarily) earned for a quarter or for a semi-annual basis under Circular 124 have been removed.

Circular No. 176/2009/TT-BTC – Reduce Income Tax for people working in the Economic Zones

Individuals working for Economic Zones (EZs) in VietNam will enjoy a 50% reduction of their yearly income tax, stipulates the Ministry of Finance’s (MoF) Circular No. 176/2009/TT-BTC.
The beneficiaries include both Vietnamese and foreign residents or non-residents directly working in management boards, State management agencies, and business enterprises in EZs.

Especially, employees who serve for organizations or individuals operating outside EZs and are assigned to work in EZs will enjoy the tax reduction policy.

Circular No. 27/2009/TT-BTC providing guidance on Personal Income Tax deferment

On 6 February 2009, the Ministry of Finance issued Circular 27/2009/TT-BTC to provide the deferment of payment of Personal Income Tax (PIT) for certain qualifying taxpayers.

Qualifying taxpayers
• Resident individuals receiving income derived from business activities, including salaries and wages, income from capital investments and capital transfers (including securities transfers), income from royalty and franchising, income from inheritance, and income from receiving gifts.
• Non-resident individuals receiving income from capital investments and capital transfers (including securities transfers), income from royalty and franchising.
• Other taxpayers not covered in Circular 27 shall continue to declare and pay PIT as normal under the current PIT Law.

Circular No. 84/2008/TT-BTC of September 30, 2008 in English

The long awaited Circular No. 84/2008/TT-BTC was finally issued on September 30, 2008 by The Ministry of Finance.

The circular will provide more details on the implementation of the provisions set out under the PIT Law (Law No. 04/2007/QH12 issued on November 21, 2007) and the PIT Decree (Decree No. 100/2008/ND-CP issued on September 8, 2008).

The New Law repeals the following laws and regulations:

(a) Ordinance on Income Tax of High Income Earners No. 35/2001/PLUBTVQH10 (as amended in 2004);

(b) Land Use Rights Transfer Tax Law which was issued on 22 June 1994 (as amended in 1999);

(c) Regulations on Corporate Income Tax applicable to individuals conducting production and business excluding private enterprises as stipulated in Corporate Income Tax Law No. 09/2003/QH11;

(d) Other provisions on personal income tax which are contrary to the provisions in the New Law.

The content of the Circular No. 84/2008/TT-BTC includes the following matters:

Decree No. 100/2008/ND-CP detailing the Law on Personal Income Tax

Following the passing of Vietnam’s Personal Income Tax Law in 2007, the Government has issued the Decree No. 100/2008/ND-CP on September 8, 2008 detailing a number of articles.

According to the Decree No. 100/2008/ND-CP, there are 10 kinds of taxable incomes, including incomes from salaries and wages; business and production; capital investment; transfer of capital and real estate; lottery winnings; copyright; franchise activities; inheritance and gifts which are securities, capital or assets that must be registered.

The decree also regulates 14 kinds of incomes that will enjoy tax exemption, such as income from real estate transferred between a husband and wife, blood-relationships; interest on deposits at banks and credit institutions; compensations from life insurance contracts; scholarships; and retirement pensions.

The content of the Decree No. 100/2008/ND-CP includes the folleing matters:

Law on Personal Income Tax (2007)

LAW ON PERSONAL INCOME TAX

(No. 04/2007/QH12)
Pursuant to the 1992 Constitution of the Socialist Republic of Vietnam, which was amended and supplemented under Resolution No. 51/2001/QH10;
The National Assembly promulgates the Law on Personal Income Tax.
Chapter I
GENERAL PROVISIONS
Article 1. Scope of regulation
This Law provides for personal income taxpayers, taxable incomes, incomes eligible for personal income tax exemption or reduction, and personal income tax bases.
Article 2. Taxpayers
1. Personal income taxpayers include residents who earn taxable incomes specified in Article 3 of this Law inside and outside the Vietnamese territory and non-residents who earn taxable incomes specified in Article 3 of this Law inside the Vietnamese territory.
2. Resident means a person who satisfies one of the following conditions:
a/ Being present in Vietnam for 183 days or more in a calendar year or 12 consecutive months counting from the first date of their presence in Vietnam;
b/ Having a place of habitual residence in Vietnam, which is a registered place of permanent residence or a rented house for dwelling in Vietnam under a term rent contract.
3. Non-resident means a person who does not satisfy any of the conditions specified in Clause 2 of this Article.
Article 3. Taxable incomes
Incomes liable to personal income tax include the following kinds of income, except for incomes eligible for tax exemption specified in Article 4 of this Law:
1. Incomes from business activities, including:
a/ Incomes from goods production or trading or service provision;
b/ Incomes from independent professional activities of individuals possessing practice licenses or certificates in accordance with law.