Acca - F6 Pit

Personal Income Tax (PIT) 1
STUDY GUIDE
1. The scope of personal income tax (PIT)

a) Identify the individuals, resident and non-resident, liable to pay
PIT.
b) Explain how the tax residence of an individual is determined.
c) Recognise the difference in the tax treatment of a resident

individual and a non-resident individual.
d) Recognise the difference in the tax treatment of income sourced

from Vietnam or outside of Vietnam for residents and non-
residents.
e) Understand how a double taxation agreement can affect the

liability to taxation of certain classes of individual and of different
types of income.
2. Income subject to PIT

a) Explain the basis of assessment for income derived by an
individual.
b) Identify exempt income, allowances, benefits and receipts not

subject to PIT and reductions in tax.
c) Distinguish between income which is subject to progressive PIT

rates and income which is subject to specific PIT rates.
d) Explain how the attribution of income is determined
e) Explain how the income of individuals in the capacity of producers,

traders and service providers is determined.
f) Explain the treatment of business income, salary income, income

from capital investments, income from capital transfers, income
from real property transfers, income from winnings or prizes,
royalty income, income from franchises, income from
inheritances, income from receipt of a gift and other income
Excluded topics - Agricultural income of small scale producers
3. The comprehensive computation of monthly and

annual taxable income and tax liabilities
a) Compute business and salary income, including the assessment
of employment benefits in kind.
b) Compute other taxable income and distinguish its treatment from

that of business and salary income.
c) State the expenses and apply the deductions (if any) that can be
used to reduce taxable income.
d) Recognise the individual income of non-residents subject to

personal income tax and compute the tax to be withheld.
e) Compute the monthly and annual tax liabilities of residents and

non-residents with regard to: all types of income whether sourced
from Vietnam or overseas.
f) Compute any available tax credit and double taxation relief in

respect of foreign taxes and withholding taxes.
4. The use of exemptions and reliefs in deferring and

minimising PIT liabilities
a) Identify, compute and apply the right reduction/relief in given
circumstances.
b) Explain how alternative structuring of all types of income can result

in different amounts of taxable income and tax liability.
Excluded topics - Detailed provisions of individual tax treaties

A. THE SCOPE OF PIT
1. TAXPAYER
The PIT law applies to individuals, who have taxable income,

irrespective of tax residency status, nationality, living, gender, age, etc...
IN THIS WORLD nothing is certain but DEATH TAXES

- Benjamin Franklin
2. RESIDENCY STATUS
a. Tax Residents: individuals who meet one of the following

conditions:
ü Physically present: in Vietnam from 183 days in (i) the calendar year
or (ii) the period of 12 consecutive months from the date of first arrival;
or
ü Regular place of resident in Vietnam:
- registered permanent residence place (Vietnamese: household

book, foreigners: permanent/temporary resident card); OR
- leased residence in Vietnam with terms from 183 days

(accumulated for all available contract, if any) in a tax year (i.e. (i)
calendar year or (ii) in a period of 12 consecutive months from the
date of first arrival; OR
ü Not satisfying the above 2 conditions but unable to prove for qualifying
as tax resident of another country in a tax year
Evidence to prove tax resident status:
(i) Original Tax Residence Certificate - countries having Tax Treaty with
Vietnam; or
(ii) Copy of passport (to prove physical present days) - countries which
have not signed Tax Treaty with Vietnam.
Matrix to determine residency status:
Staying in Vietnam
Staying in Vietnam less than
from 183 days and
183 days
above
Having regular Tax resident (unless he is a tax

Tax resident
accommodation in Vietnam resident of another country)
Not having regular

Tax resident Tax non-resident
accommodation in Vietnam
Note:
§ Day-count is based on calendar days (not working days)
§ Regardless the purpose of the visit (i.e. working/ holidays/visiting

family, etc...)
Example: Determine number of days present in Vietnam for PIT purposes

for the expat:
Date come to Date leave Days present in Vietnam for PIT

Vietnam Vietnam purposes
1 Jan 2017 3 Jan 2017 ………………………………………………….
1 Jan 2017 2 Jan 2017 ………………………………………………….
1 Jan 2017 1 Jan 2017 ………………………………………………….

Tax residents subject to Vietnamese PIT on worldwide taxable

income
b. Tax non-residents: individuals NOT meeting the conditions for being

tax resident.
Tax non-residents subject to Vietnam PIT on the Vietnam

related income (i.e. Vietnam sourced income)
Example: Mr. Thomas is a tax resident in Singapore and does not

physically present in Vietnam in 2017. He got employment income for both
jobs related to Singapore and Vietnam business.
Which of the following is correct?

A. His income is PIT exempt in Vietnam as he does not physically present
in Vietnam in 2017
B. His income is PIT exempt in Vietnam as he is a tax resident in
Singapore in 2017
C. His income subject to PIT in Vietnam on Vietnam sourced income only
D. His income subject to PIT in Vietnam on worldwide income
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3. TAX YEAR (TAXABLE PERIOD)
a. Tax resident:
ü Yearly tax declaration: employment income
§ Stay in Vietnam for 183 days or more in a calendar year since

1st arrival date: calendar year;
§ Stay in Vietnam for less than 183 days in a calendar year but
183 days or more in 12 consecutive months since 1st arrival
date:
- 1st tax year: 12-consecutive months from 1st arrival date
- 2nd tax year onwards: calendar year
ü One-off tax declaration: other types of income
b. Tax non-resident: One-off declaration
December 2015: Mr Tomaz is a Hong Kong citizen and tax resident. He

arrived in Vietnam to work on 21 April 2014 and on completion of his
employment contract, he left Vietnam on 31 October 2015. In the years
2014 and 2015, he spent the following numbers of days in Vietnam:
- From 21 April to 31 December 2014 130 days

- From 1 January to 20 April 2015 - 64 days
- From 21 April to 31 October 2015-110 days
Based solely on the above information, what is Mr Tomaz's tax residency

status in his first and second tax year in Vietnam?
First year Second year

A. Resident Resident
B. Resident Non-resident
C. Non-resident Resident
D. Non-resident Non-resident
Example: Kobe Bryan is a foreigner who first comes to Vietnam on April

20, 2015. In 2015 up to December 31, he has stayed in Vietnam for 130
days. In 2016 up to April 19, he has stayed in Vietnam for 50 days. For the
remaining period in 2016, he stayed in VN 50 days in total.
Please identify his residency status in 2 relevant tax years.
First year Second year

A. Resident Resident
B. Resident Non-resident
C. Non-resident Resident
D. Non-resident Non-resident
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Type of income subject to PIT
1. Incomes from business
2. Incomes from salary and wages (Employment income)
3. Incomes from capital investment
4. Incomes from capital transfer
5. Incomes from real estate transfer
6. Incomes from winning prizes
7. Incomes from royalty
8. Incomes from franchising
9. Incomes from inheritance
10. Incomes from receipt of gifts

B. EMPLOYMENT INCOME
1. OVERVIEW
ü Employment income: income received from employer based on

employment relationship
ü Both (i) in cash (ii) in-kind incomes are assessed for PIT
purposes
2. TAXABLE TIME
ü taxable for PIT when the income is actually received (i.e. not
accrual basis)
ü except for capital/ stock granted is at the moment capital/ stock is

transferred.
3. TAXABLE INCOME VS. NON-TAXABLE INCOME

(INCOME EXEMPT FOR PIT)
Summary of taxable and non-taxable for main employment incomes:
Type of Non-taxable /
Taxable Example
income exempt
1 Salary Taxable N/A
Lebron James works 3 OT
Payment hours paid at 150%
Overtime Premium in excess
based on normal wage (normal
2 payment of normal working
normal working wage = USD10/hour).
(OT) rate
rate Taxable/ Non-taxable
income?
Certain bonuses in .
cash recognized by
the Government (i.e.
Taxable if Certificate, national/
not qualifying international prize,
3 Bonuses
exempt invention/ technique
condition improvement, denou
nce illegal behavior
to competent
authority)
(i) Wedding and (ii) .

funeral welfare to
Taxable if not
employee/ employee
qualifying
4 Welfare family up to 1 month
exempt
salary of relevant
condition
employee - follow
CIT regulations
Some notable Stephen Curry and his

allowances: family (wife, daughter,
- Allowances for nephew) have serious car
fatal disease to accident that got
cover individual treatment in hospita in 3
cost (actual months. The Company
Taxable if not
hospital expense bears the following costs:
qualifying
5 Allowances - from the
exempt ü Allowance provided by
condition Insurance
the Company for each
company) for both
person: VND30 mil
(i) employee &
(ii) 1st level of ü Actual hospital
direct dependent expense incurred by
(children, parent, each person: VND30
spouse) mil
- Hardship The Insurance company

allowance (toxic compensates for Curry at
and dangerous VND 20mil
workplaces)
Taxable/ non-taxable
- Attraction
income?
allowance /
regional
allowance
- Severance
allowance/
Retrenchment
allowance/
maternity leave
allowance, labor
accident
allowance, other
allowances, etc...
under Labor Laws
and Social
Insurance Laws
- Mid-shift
allowance: (i) in-
kind (no cap) or
(ii) in cash up to
VND730k/ month
- threshold to
follow latest labor
regulations
- Uniform: (i) in-

kind (no cap) or
(ii) in cash up to
VND5 million/
year - follow CIT
regulations
Perdiem/
Transporta-
tion/
accommod- Taxable if not
PIT exempt if in
ation for qualifying
6 accordance with
businesstrip exempt
internal policy
Fixed condition
payment for
telephone/
stationery
One-off relocation
for:
- Expat/ Viet Kieu

relocates from
overseas to work
Taxable if in Vietnam; and
not qualifying - Vietnamese
7 Relocation
exempt relocates
condition from Vietnam to
work in overseas
- For individual to
relocate to social-
economy difficulty
geography
- Compensation
under life/ non-
Taxable if life/ health
Compensa- not qualifying insurance paid by
8
tion exempt Insurance
condition Company.
- Compensation for
work-related
accicent in line
with Labor Laws/
Insurance Laws
- Other
compensation
stipulated under
Laws
In-kind 1 round trip

per year for
employee to back to
home country Company offers 2 round
trip for Kevin Duran and
Taxable if - Expat from
family members (wife,
not qualifying Vietnam back to
9 Air fare son, daugther) annually,
exempt country where
USD 3,000/person for
condition he/she orginal
each round trip. Taxable/
reside; and
Non-taxable income
- Vietnamese from
overseas back to
Vietnam
In kind tuition fee for In-kind monthly tuition

children to study fee package is offered to
from nursery up to Yao Ming as follows:
high school level:
- Wife: studies Master in
Taxable if not
- Expat: children to Vietnam of USD5,000
qualifying study in Vietnam;
10 Tuition fee - Son: studies high
exempt
condition - Vietnamese: school in US of
children to study USD3,000
in overseas
- Daughter: studies RMIT
University in Vietnam:
USD4,000
Taxable/ non-taxable
income?
Taxable if not In 2017, the Company
qualifying purchased for the James
exempt Harden and his family
condition (wife, son & daughter) the
Note for following voluntary
taxable time of insurance scheme:
voluntary
+ accumulation a) Monthly
accumulation insuranc
insurance:
e of USD3,000 per
Local insurance
person. The
- insurance co For both local/
Insurance overseas insurance cummulative plus 5%
mpany to
contribution per year shall be paid
withhold For employee:
(employer in 2020;
10% on pay- - Compulsory
portion) out of b) Monthly non-
insurance (SI, HI,
11 Employee accumulated UI) accumulation health
contribution insurance of USD2,000
portion - Voluntary + non-
& gain per person
to view accumulation +
before Monthly taxable/non-
in Deduction nature
paying taxable on income of the
part health/death
Overseas expat in 2017?
insurance
insurance
- employer to
withhold
10% on
contribution
immediately
when paying
fee to
insurance
company
In cash: fully
taxed
In kind: Min
(Actual housing The Company provides
Housing allowance vs. Tim Duncan monthly
allowance 15% taxable housing allowance in kind
In kind: Part
(including income of USD2,000, His monthly
exceeding
associated u his taxable income,
12 excluding 15% (taxable income
tilities, mana exclusive of housing
housing excluding housing
gement fees, allowance is USD10,000.
allowance) allowance)
services Monthly taxable/ non-
Note: including
fees) taxable for housing
utilities, allowance?
management
fees, services
fees
Membership
fees (golf
courses,
Taxable if not In kind & non-
clubs, etc.)
qualifying identified beneficiary
13 Health care/
exempt (individual name is
entertain-
condition not specified)
ment/
beauty care
activities
Taxable if not For business purpose

Daily
qualifying of employee only (i.e.
14 transporta-
exempt between home and
tion
condition office, business trip)
June 2015: Which of the following items of income would NOT be subject
to PIT in Vietnam?
(1). Medical support for fatal disease from the employer to the parent-in-
law of an employee
(2). One time round trip home leave air fares for the family of an expatriate
employee
(3). Kindergarten tuition fees for the children of a Vietnamese employee
working abroad
(4). Voucher issued by the employer to an employee for lunches in the
canteen operated by the employer
A. 1, 2 and 3
B. 2, 3 and 4
C. 1, 2 and 4
D. 1, 3, and 4
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4. ASSESSABLE INCOME
ü Tax resident:
Taxable income
Less Statutory compulsory insurance contributions (SI, HI, UI)
Less Voluntary pension scheme/funds (cap VND 1million/month)
Less Personal deduction (VND 11 million/month)
Less Dependant deduction (VND4.4 million/person/month)
Less Deductible donations
Assessable income
ü Non tax resident = taxable income (i.e. no deduction is

allowed)
5. DEDUCTION (applicable for tax resident only)
5.1. Statutory compulsory insurance contributions (SI, HI, UI)
ü employee's portion for Vietnam and overseas;
ü compulsory insurance under Vietnam regulations:
§ Vietnamese: Social insurance ("SI"), Health Insurance

("HI") and Unemployment insurance ("UI");
§ foreign individuals employed under Vietnam labour

contracts: HI
ü employee SI, HI, HI rate:

Contribution SI HI UI Total
Employee 8% 1.5% 1% 10.5%
ü cap of SI, HI, UI
§ SI, HI: 20 x common minimum salary
§ Ul: 20 x regional minimum salary
For simplicity, ACCA may propose a fixed amount of VND 29.8 million /
month (VND1.49 million x 20) for all the compulsory insurance types.
Income subject to contribution of compulsory insurance
- Basic salary
- Salary-natured allowance
- Other allowance specified in labour contract and paid every month
Income not subject to contribution of compulsory insurance
- Bonus
- Mid-shift meal allowance
- Supports such petroleum, telephone, travelling, housing, child caring,
wedding, birthday, etc
- Other benefits without specific amount in labour contract
Note: Depending on a case by case basis which is clearly mentioned in

the question, some types of income may be subject to compulsory
insurance.
For example: "it was confirmed that overtime and uniform allowance would
NOT be in the list of items to be excluded in determining income which is
subject to social, health and unemployment insurance contributions."
5.2. Voluntary pension scheme/funds
ü Deductible cap: VND1 mil/ month for employee

ü Deduct employee's portion 1st, then employer's portion.
Remaining employer's portion exceed VND1 mil/ month (if
any) is treated as taxable income for employee
Example 1: In 2017, the Company purchase for the Kyrie Irving & his wife
Vietnam non-compulsory pension as follows:
- Monthly individual's portion: VND0.8 mil

- Monthly employer's portion: VND1.8 mil
Calculate monthly (i) taxable/ non-taxable income and (ii) deduction for the
Kyrie Irving in 2017
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Example 2: In 2017, the Company purchase for the Kyrie Irving & his wife
Vietnam non-compulsory pension as follows:
- Monthly individual's portion: VND1.2 mil

- Monthly employer's portion: VND 1.8 mil
Calculate monthly (i) taxable/ non-taxable income and (ii) deduction for the
Kyrie Irving in 2017
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5.3. Personal deduction
ü VND 11 million per month for months which the individual subject to
PIT, regardless of months without income or having income less than
such threshold
Note: For past exam (which based on tax regulations from 2019
backward) personal deduction is VND 9 million per month
ü Expat who 1st arrives to Vietnam in the middle of year (i.e. Mar 2017)
and 1st tax year is assessed as calendar year (i.e. full 2017). Consider
country where expat comes from
§ Country signed Double Tax Avoidance ("DTA") agreement with

Vietnam: count from the arrival month to year end (i.e. Mar - Dec
2017);
§ Country has not signed Double Tax Avoidance ("DTA") agreement

with Vietnam: full year (i.e. Jan Dec 2017)
5.4. Dependant deduction (family felief)
ü VND4.4 million per month per qualified dependant from the month
of caring responsibility arises (full month - not pro-rate on days)
Note: For past exam (which based on tax regulations from 2019
backward) personal deduction is VND 3.6 million / month per
qualified dependent
ü Not automatically granted (i.e. the taxpayer must register qualifying

dependents and provide supporting documents to the tax authority)
ü Each dependant is allowed to register for one (1) a taxpayer only in

the tax year (i.e. no duplicate)
ü Dependants include:
v Chilren:
§ < 18 years old; OR
§ from 18 years old, but qualifies 1 of 2 conditions below:
- disability, no ability for working; or
- . (i) still study up to university level and (ii) monthly
income not exceeding VND1 mil
v Spouse /Other dependents that directly take care (i.e. siblings,

grandparents, aunts, uncles, niece, nephew, etc.)
§ within working age: (i) disability, no ability for working and (ii)
monthly income not exceeding VND1 mil; OR
§ above working age: monthly income not exceeding VND1 mil
Working age under current Vietnam regulations:
- Woman: up to 55
- Man: up to 60
Example: Please advise who as described below can be claimed as

dependant:
1. Wife - 40-year-old - does housework and has no income
2. Mother - 60-year-old - receives monthly income VND8 mil from house
rental
3. Father - 65-year-old - has no income
4. Niece - 20-year-old - studies in RMIT University
5. Daughter-20-year-old - studies in Curtin University
6. Son 14-year-old - studies in high school
5.5. Deductible donations
If donations contribute to (i) certain qualified organizations/ fund (ii) which

are set up or recognized in accordance with Vietnam regulations:
ü Organisations nurturing kids, invalids and elderlies

ü Charity funds, humarily study encouragement funds
Note: donation is deducted in relevant year only (i.e. no carry forward

allowed)
June 2015:
On 1 April 2014, Mr Chau, a Vietnamese national, started employment with

a new employer, CTD Co. CTD Co has a policy whereby both the employer
and the employee contribute to a voluntary pension fund approved by the
Government. The monthly contributions for the employer and the
employee, respectively, are VND4.5 million and VND2 million.
What is the amount of the deduction Mr Chau can claim against his taxable
income for the above contributions in 2014?
A. VND9 million
B. VND78 million
C. VND24 million
D. VND 18 million
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June 2018:
In January 2017, Mr Chris Beath, a 50-year-old Australian citizen, started

his employment in Vietnam for VF Co, a Vietnamese company. In March
2017, his wife Allanda, also a 50-year-old Australian citizen, suffered an
accident in Australia. She was not handicapped but had to move to
Vietnam to live with Chris from April 2017 to the end of the 2017 year. She
had no income in 2017. VF Co provided Chris with cash support of VND120
million towards medical care expenses for Allanda in Vietnam during 2017.
What is the total personal deduction/relief (in VND millions and

ignoring social, health and unemployment insurance) Mr Chris Beath
can claim in the year 2017 relating to his personal income tax (PIT)?
A. VND228 million
B. VND140 million
C. VND260 million
D. VND 108 million
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December 2017
Mr Simon Samson, a 52-year-old South African, arrived in Vietnam on 15

March 2016 following an invitation to become a permanent teacher for
VSU, an international school in Vietnam, for the period to December 2020.
VSU successfully registered Simon's personal tax code and other
necessary dependant registrations for personal income tax (PIT) purposes
on 31 March 2016.
Simon spent the remainder of 2016 in Vietnam. On a trip to visit an

orphanage in the South, he adopted Luong Le, a one-year-old Vietnamese
boy, as his son. He completed the procedures for adoption and started to
raise Luong Le from 10 August 2016. Luong Le officially became a
dependant of Simon from 31 August 2016.
Simon has a daughter, Lauren, who is 19 years old. At the time Simon
moved to Vietnam, Lauren was studying at a university in South Africa. In
September 2016, she came to Vietnam to live with Simon and study at an
international university in Vietnam. Lauren has no income in the year
2016.
From May 2016, VSU signed a contract with a voluntary insurance fund
which is allowed to operate in Vietnam for Simon. According to this
contract, VSU and Simon contributed VND2.5 million and VNDO-8 million
per month, respectively.
In December 2016, Simon donated VND60 million to a qualifying charity

fund.
Required:
Calculate (in VND millions rounded up to the nearest one decimal) all the
possible deductions from taxable income which Mr Simon Samson is
entitled to for personal income tax (PIT) purposes during the year 2016. (7
marks)
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December 2020
Mr John Wilson, 50 years old, is a Canadian citizen working for DigitalCoin

Co, a company established in Canada. John came to Vietnam on 15
February 2019 to be the chief executive officer of DC Vietnam Co, a
subsidiary of DigitalCoin Co. He is eligible to be tax resident in Vietnam in
2019.
Upon his arrival in Vietnam, John was accompanied by his children: Albert
Wilson, 20 years old, and Valentine Wilson, who was 18 years old on 1
November 2019.
Before moving to Vietnam, Albert enrolled to study Vietnamese culture

from February 2019 in a qualified university in Vietnam, which has a
student exchange programme with the university he had attended in
Canada. During 2019, Valentine was a data analytics student on an online
programme delivered by an international university, and from 1 November
2019 she also started working as a part-time analyst for a company in
Vietnam for an income of VND11 million per month. Other than this, neither
child had any income in 2019.
John made compulsory insurance contributions in Canada, equivalent to

VND10 million per month, and maintained these contributions during the
time he was in Vietnam. From 1 April 2019, John purchased a voluntary
pension product from a private pension fund in Vietnam for VND3 million
per month, to support his pension fund.
During 2019, John donated VND80 million to a qualified education fund

and has the necessary supporting documents.
Required:
a) Calculate (in VND millions, rounded to one decimal) the total possible
deductions from Mr John Wilson's taxable income for personal income
tax (PIT) purposes in the calendar year 2019. (7 marks)
b) DC Vietnam Co is considering purchasing life insurance with accrued
premiums for Mr John Wilson in the year 2020, but wants to firstly
assess how the purchase would impact on John's personal income tax
(PIT) liability.
Briefly explain the PIT implications for Mr John Wilson if DC Vietnam

Co were to purchase life insurance with accrued premiums for him,
from an insurer that is registered to operate in Vietnam. (3 marks)
(10 marks)
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6. TAX RATE
ü Tax resident: progressive tax rate 5-35%
ü Nontax resident: flat tax rate 20%
7. CALCULATION APPROACH
ü Tax resident
Step by step:
GROSS of PIT NET of PIT

Step
(individual bear PIT) (employer bear PIT)
Determine: Determine:
(i) taxable /non-taxable (i) taxable / non-taxable

income excluding housing income excluding housing
1
benefit- world wide benefit - world wide income
income (ii) qualified deduction
(ii) qualified deduction
Taxable net income excluding

2a N/A housing benefit subject to gross-
up (- Deduction)
Gross-up income excluding

housing benefit (taken
2b N/A
Deduction already): to appply
gross-up formula (1st time)
Taxable housing Taxable housing benefits: Min

benefits: Min (actual (actual housing vs. 15% x other
3 housing vs. 15% X other taxable income before
taxable income before deduction) Apply for
deduction) housing
Allowance
Gross-up income including in-kind
housing benefit (taken
4 N/A
Deduction already): to appply
gross-up formula (2nd time)
Total Assessable income = Total Assessable income = Total

Total Gross income – Gross- up income (taken
5
Deduction Deduction already)
(2b or 4 above)
PIT: to apply relevant formula PIT: to apply relevant formula to

6
to Assessable income Assessable income
Gross-up formula:
mil VND
Monthly income subject

to gross-up (N*) Monthly Gross-up income (G*)
(Net income after (Gross-up income after Deduction)
Deduction)
N* < 4.75 G* = N*/ 0.95

4.75 < N* < 9.25 G* = (N* -0.25)/ 0.9
9.25 N* < 16.05 G* = (N* -0.75)/ 0.85
16.05 < N* < 27.25 G* = (N* - 1.65)/ 0.8
27.25 N* < 42.25 G* = (N* -3.25)/ 0.75
42.25 < N* < 61.85 G* = (N-5.85)/ 0.7
N* > 61.85 G* = (N-9.85)/ 0.65

Note: In case of Net, Gross-up income after deduction (G*) = Asessable

income (A), which mean, do not take into account deduction 2 times
PIT formula:
mil VND
Monthly Assessable income

(A)
Monthly PIT
(Gross-up income after
Deduction)
A<5 PIT = 0.05A
5 <A < 10 PIT = 0.1A - 0.25
10 < A < 18 PIT = 0.15A - 0.75
18 < A < 32 PIT = 0.2A - 1.65
32 < A < 52 PIT = 0.25A - 3.25
52 < A < 80 PIT = 0.3A - 5.85
A > 80 PIT = 0.35A - 9.85
Important Example:
Monthly packages of Mr. Vincent in 2019 is as follows:
- Salary in cash: VND 100 mil

- Housing allowance in kind: VND 20 mil
He claimed his 15 years old son as dependent for tax deduction:
Calculate his monthly PIT for 2 cases: (i) gross of PIT & (ii) net of PIT
Gross PIT Net PIT
1 Taxable income 100 Taxable net income 100

excluding housing excluding housing benefit
benefit
2a Taxable net income 87.4
excluding housing benefit
subject to gross-up (-
Deduction)
2b Gross-up income 119.3
3 Taxable housing benefit 15 Taxable net housing benefit 19.8

Actual housing in kind 20 Actual housing in kind 20
15% gross income 15 15% gross income excluding 19.8
excluding housing housing benefit (to add back
Deduction)
Taxable net income 107.2
subject to gross-up (-
Deduction)
4 Gross-up income including 149.7

housing benefit
Total monthly gross 115
income
Monthly deduction (12.6)
5 Total monthly assessable 102.4 Total monthly assessable 149.7

income income
6 Monthly PIT 26.0 Monthly PIT 42.6
June 2015:
Ms Nga Le is a Vietnamese national with no dependants. On 1 January

2014, she signed a gross employment contract with salary of VND260
million per month. Her employer is not required to withhold compulsory
insurance from her income.
What is the amount of Ms Nga Le's monthly net take home income?
A. VND81-15 million
B. VND78 million
C. VND178-85 million
D. VND182 million
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December 2015:
Ms Hoai Pham has two dependants. In 2014, her monthly gross salary
was VND50 million and she was responsible for paying 8% social
insurance and 1-5% health insurance. Statutory base salary for 2014 is
VND23 million per month.
What is Ms Hoai Pham's monthly tax liability (to the nearest VND10,000)?
A. VND4-16 million
B. VND4-67 million
C. VND6.26 million
D. VND5-20 million
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December 2018:
Ms Dung Nguyen is a Vietnamese citizen with three registered

dependants. During 2017, she received a gross monthly salary of VND96
million, plus a bonus equal to two months' salary in April 2017, relating to
her work performance in 2016. Her employer also paid rent for a car for
her to travel from home to work and vice versa at an annual cost of VND240
million. Dung is responsible for her own social, health and unemployment
insurance. Statutory base salary for 2017 is VND26 million.
What is Ms Dung Nguyen's annual personal income tax (PIT) liability

(in VND millions - to be rounded only in the final PIT calculations) in
the year 2017?
A. VND320 million
B. VND387 million
C. VND303 million
D. VND236 million
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December 2018:
Mr Minh Phan, a Vietnamese citizen, was assigned to work in the United

States (US) representative office of FTP Co, a company headquartered in
Vietnam. In 2017, he received monthly gross income of USD10,000, plus
an annual tuition fee of USD30,000 for Quang Phan, his ten-year-old son,
for studying at a school in the US. The tuition fee was paid directly by the
representative office of FTP Co to the school. Exchange rate USD/VND =
22,800.
What is the amount (in VND million, rounded to two decimals) of Mr

Minh Phan's Vietnamese monthly personal income tax (PIT) liability
in the year 2017 (before deducting any foreign tax credit)?
You should assume Mr Minh Phan is not subject to any compulsory

insurance in Vietnam.
A. VND 85-49 million

B. VND 66-80 million
C. VND 86-75 million
D. VND 65-54 million
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June 2019:
Mr Quang Phan, a 35-year-old Vietnamese tax resident, works for Hash

Vina, a foreign invested company in Vietnam. He was relocated back to
Vietnam on 1 January 2018 after a three-year secondment to Hash
Australia, a sister company of Hash Vina. In 2018, Mr Quang received
VND200 million monthly gross salary plus a performance bonus equivalent

to VND360 million for his work in Australia. During 2018 Hash Vina also
paid for two return airfare tickets costing VND46 million in total for Mr
Quang to visit his 35-year-old wife and 16-year-old son who live in
Australia. Statutory base salary for 2018 is VND27.8 million.
What is Mr Quang Phan's annual personal income tax (PIT) liability

(in VND millions - to be rounded only in the final PIT calculations) in
the year 2018?
A. VND 799 million

B. VND 673 million
C. VND 803 million
D. VND 791 million
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December 2018
Mr Nobi Nobita, a 52-year-old Japanese citizen, was employed to work in

Vietnam from 1 January 2017 by Local-1 Co, a company established in
Vietnam. Nobi was accompanied by his wife, Shizuka, who is 50 years old.
Shizuka is a part-time teacher working for a foreign language centre in
Vietnam, from which she earns VND10 million per month. They have two
children, Nobisuke who is 19 years old, and Nobijaiko who is 12 years old.
Nobijaiko has resided in Vietnam with his parents since 1 January 2017
and has been attending school throughout 2017. Nobisuke came to
Vietnam in June 2017 to attend a half-year of university. Neither child had
any income in 2017.
In 2017, Nobi's remuneration package from Local-I Co included the

following items:
- Monthly salary: USD25,000.
- Performance bonus: one month's salary to be paid in February each

year, plus a variable incentive dependent on the company's
performance. Nobi was paid a bonus of USD80,000 in May 2018
based on the company's performance in 2017.
- Air fares: Local-l Co paid for two return trips for Nobi and his whole
family to visit Japan, at a cost of USD1,000 per person. In May 2017,
Nobi also requested that Local-I Co book one return trip at a cost of
USD1,500 per trip per person for his family to visit Australia, where
Shizuka's parents live. The company decided to pay for the air fare for
Nobi only and to deduct the air fare for his family from his salary.
- Housing: Local-l Co signed a contract directly with the landlord for Nobi
and his family to live in a property. The rent paid by Local-I Co was
USD2,800 per month.
- Tuition fees: the company agreed to pay tuition fees in Vietnam for
both children at an annual cost of USD12,000 each. The tuition fees
are paid directly to the school and university in two equal instalments,
due in March and October each year (in 2017, in respect of Nobisuke,
only one payment was made in October).
- Car: The company rented a car for Nobi and his family at a cost of
VND15 million per month. According to the records, in 2017 40% of
the car's usage related to Nobi's transportation from home to the
company's premises and vice versa. The remainder was for his
family's personal use.
- Relocation allowance: Nobi was offered a relocation allowance of up

to USD10,000, to be settled directly by the company to the vendor.
The actual costs were USD13,800, for which Nobi settled the
difference with the vendor himself.
The remuneration is gross of Vietnamese tax. You should assume Nobi

registered all eligible dependants on time with relevant documents, and
was responsible for his part of social, health and unemployment insurance
in the same manner as a local employee. Statutory base salary for 2017 is
VND26 million.
Exchange rate USD/VND = 22,800
Required:
a) Calculate (in VND millions, rounded to one decimal) the taxable and
non-taxable income (before any housing benefits) of Mr Nobi Nobita in
2017.
Note: You should list all the items of income, other than any housing
benefits, specifically referred to above, indicating by the use of a '0'
any item which is not relevant. (10 marks)
b) Calculate (in VND millions, rounded to one decimal) Mr Nobi Nobita's

monthly taxable income (including any taxable housing benefits) and
the personal income tax (PIT) liability in respect of his employment
income for the year 2017. (5 marks)
(15 marks)
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June 2020
The following scenario relates to two requirements.
Mr Bert Walsh, a United Kingdom (UK) citizen, retired from a consulting

firm and was invited to Vietnam to work as a senior advisor to LDT Co, a
foreign invested company in Vietnam, from 1 April 2019. Bert is 65 years
old. Bert's wife, Mrs Jane Walsh, who is 53 years old, joined Bert to live in
Vietnam. Bert and Jane have two granddaughters, Clara aged eight years,
and Sarah aged six years, who live with them in Vietnam. Jane has no
income and stays at home in Vietnam to take care of Clara and Sarah.
Bert's contractual gross remuneration from LDT Co during 2019 consisted

of the following items: - Monthly salary: USD 25,000
- Incentives: two month's salary for each year of service (pro-rata), plus a
bonus of USD 50,000 to be paid on the completion of Bert's first year of
work for LDT Co.
- International school tuition fee: monthly fee of USD1,500 for Clara and
USD1,000 for Sarah were paid directly by LDT Co to the school during
2019. LDT Co also settled the fees for the school bus and meals of USD
400 per month for each child, and sought reimbursement from Bert.
- Air fares: LDT Co reimbursed air fares for two round trips between the UK
and Vietnam for Bert and his wife. Bert also asked LDT Co to book flights
for his granddaughters to join him on those trips, which LDT Co did, and
deducted the costs from his monthly salary. The air fare costs for each
round trip in the year ended 31 December 2019 was USD 3,500 per
person.
Medical insurance: LDT Co purchased medical insurance to cover each

member of Bert's family in Vietnam, at a cost of USD 1,000 per month per
person.
- Accommodation: An apartment was purchased near to the office of LDT

Co for USD 600,000, with the intention to let it out to special guests such
as Bert. The apartment had a term of use of 50 years. LDT Co depreciated
the apartment in its accounting records using the straight-line method over
the term of use.
- Utilities, apartment management fee, cleaning services and

transportation: LDT Co paid Bert a monthly amount of USD 2,000 in cash
so that Bert could pay for these expenses directly.
Exchange rate USD/VND = 23,500.
Required:
(a) Calculate (in USD) the total gross taxable income, excluding taxable
accommodation, in the fiscal year 2019 for Mr Bert Walsh. You should also
clearly identify income that is not taxable in 2019 (including income which
is not taxable at all and income which is taxable but not in the fiscal year
2019), and non-income items of Mr Bert Walsh. (10 marks)
(b) Calculate (in VND million, rounded to one decimal) the personal income
tax (PIT) liability of Mr Bert Walsh in the fiscal year 2019. (5 marks)
Note: You should ignore all insurance contributions for the purposes of the
calculations.
(15 marks)
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ü Non tax resident:
Step by step:
GROSS of PIT NET of PIT

Step
(individual bear PIT) (employer bear PIT)
Determine: taxable /non- Determine: taxable / non-

taxable income excluding taxable income excluding
1 housing benefit- Vietnam housing benefit - Vietnam
sourced income sourced income
No deduction is allowed No deduction is allowed
Taxable net income

2a N/A excluding housing benefit
subject to gross-up
Gross-up income excluding

2b N/A housing benefit: to apply
gross-up formula (1st time)
3 Taxable housing Taxable housing benefits:

benefits: Min (actual housing Min (actual housing vs. 15%
vs. 15% X other taxable x other taxable income Apply for
income before deduction) before deduction) housing
Allowance
4 N/A Gross-up income including in-kind
housing benefit: to appply
gross-up formula (2nd time)
5 Total Assessable income = Total Assessable income =

Total Gross income – Total Gross- up income
Deduction (2b or 4 above)
6 PIT = Total Assessable income PIT = Total Assessable income

x 20% x 20%
Vietnam sourced income (in case there is no clear documents verifying

specific income as the basis to declare PIT in Vietnam)
ü Individual physically presented in Vietnam:
Number of days physically Pre tax global income

Total Vietnam
present in Vietnam
related salary + pre tax other
employment
= x
365 days taxable income in
income Vietnam
ü Individual does not physically presented in Vietnam:
Number of days worked for Pre-tax global income

Total Vietnam
job in Vietnam
related salary + pre-tax other
employment
= x
Total working days in a year taxable income in
income Vietnam
Gross-up formula
𝐓𝐨𝐭𝐚𝐥 𝐭𝐚𝐱𝐚𝐛𝐥𝐞 𝐕𝐢𝐞𝐭𝐧𝐚𝐦 𝐬𝐨𝐮𝐫𝐜𝐞𝐝 𝐢𝐧𝐜𝐨𝐦𝐞
𝐆𝐫𝐨𝐬𝐬𝐮𝐩 𝐢𝐧𝐜𝐨𝐦𝐞 =
𝟎. 𝟖
Example:
Mr. Ethan Hunt is a general director of British Trading Co., a company

established in England. He is also a chief representative of British Trading
Co. in Vietnam. He shares his time for his duty in Vietnam and the head
office in England. In 2020, he visited Vietnam for 80 days.
His income in 2020 is below: (USD)
- Total salary for Vietnam duty: 12,000

- Total salary for England duty: 400,000
- Vietnam accommodation in cash:5,000
- Lecturer fees for his class in England: 15,000
Ethan has 3 children all under 18 years old and living in England.
Please calculate Ethan PIT liability for year 2020 for 2 cases:
(i) Gross of Vietnam PIT;
(ii) Net of Vietnam PIT
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June 2019:
Mr Jung Nam-Oh is a Korean citizen employed by EPR KR, a company in

Korea. From March 2018 to June 2018, Jung was assigned to work in
Vietnam on a short-term project for EPR VN Co, a subsidiary of EPR KR.
During that time Jung was present in Vietnam for 98 days. EPR Group
cannot separate his income attributable to the project in Vietnam from his
total employment income from EPR KR. In 2018, Jung's annual gross
employment income from EPR KR was USD400,000 and EPR VN Co also
paid for a golf course membership at a cost of VND 100 million for his use
whilst in Vietnam. In 2018, Mr Jung Nam-Oh had two dependants in
Korea.
Exchange rate USD/VND is 23,500.
What is the total personal income tax (PIT) liability (rounded to VND
millions) in Vietnam for Mr Jung Nam-Oh in the year 2018?
A. VND1,880 million
B. VND525 million
C. VND519 million
D. VND1,900 million
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December 2018:
On 1 September 2016, Mr Mohammad Taqi, a Singaporean citizen,

commenced a secondment in the Vietnamese representative office of AFC
Co, a company headquartered in Singapore. He received gross
employment income of USD10,000 per month from AFC Co relating to his
secondment. He resided in Vietnam from 1 September 2016 until his
employment was terminated on 15 February 2017 by AFC Co, and he left
Vietnam on the same date. He has no dependants. Exchange rate
USD/VND = 22,800
What is the amount (in VND million, rounded to one decimal) of Mr

Mohammad Taqi's personal income tax (PIT) liability for the first tax
year in Vietnam in respect of his secondment (assuming he was not
subject to social, health and unemployment insurance in Vietnam)?
A. VND182.4 million
B. VND250-8 million
C. VND367-4 million
D. VND240.9 million
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8. EXCHANGE TO VND: foreign currency to be exchanged to

VND for tax calculation at (i) at buying foreign exchange rate of the
bank where the individual has bank account at the date when the
income earned or (ii) Vietcombank in case no bank account in
Vietnam.
1st TAX YEAR & OVERLAPPED TAX PAID CALCULATION

Example: How could overlapped tax paid from 1st tax year declaration
be determined?
a. PIT liability of 2nd tax year - PIT liability of 1st tax year
b. PIT liability of 2nd tax year / PIT liability of 1st tax year
c. PIT liability of 2nd tax year* Overlapped months / 12
d. PIT liability of 1st tax year* Overlapped months / 12
June 2018
Mr Narmey Lukuka is a New Zealand citizen, who works for PGS Co, a
company in New Zealand. PGS Co has invested in a Vietnam company,
PGSVN Co. Mr Lukuka was assigned to work in PGSVN Co in Vietnam
from 1 August 2016 to 31 December 2017.
Mr Lukuka was present in Vietnam throughout the period from his first
arrival on 1 August 2016 until his departure on 31 December 2017 as
follows:
- From 1 August 2016 to 31 December 2016: 80 days
- From 1 January 2017 to 31 July 2017: 125 days
- From 1 August 2017 to 31 December 2017: 135 days
During his assignment in Vietnam, Mr Lukuka received a salary of USD

18,000 per month from PGS Co, from which PGS Co deducted New
Zealand tax of USD5,000 per month and paid the remainder directly into
his account in New Zealand. PGSVN Co also paid Mr Lukuka an allowance
of VND50 million per month and rented him an apartment at a cost of
USD3,200 per month. On 1 October 2017, Mr Lukuka received an incentive

bonus of USD50,000 from PGS Co for his good performance.
The employment agreement between Mr Lukuka and PGS Co states that

all taxes incurred on his income would be borne by him.
While he was in Vietnam, on 20 September 2017, Mr Lukuka adopted

Thien Nam, a Vietnamese new-born boy.
Exchange rate USD/VND = 22,800
Required:
(a) State the basis period (i.e. the period subject to tax) applicable to Mr
Narmey Lukuka for each of the tax years 2016 and 2017 and explain why
he will be considered as tax resident in Vietnam in both of those tax years.
(3 marks)
(b) Calculate (in VND millions rounded to one decimal) the taxable income
and personal income tax (PIT) liability and PIT payable by Mr Lukuka for
each of the tax years 2016 and 2017.
Note: You should ignore insurance contributions and any available

overseas tax credits. (12 marks)
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2 SOURCES OF INCOME AGREED ON NET BASIS OF PIT

June 2018:
Mr Thinh Phan is a 35-year-old Vietnamese citizen. He has a full-time

employment as a manager with TAC Co and has also signed a part-time
employment contract with KNT Co for the delivery of soft skills training
courses. Both TAC Co and KNT Co are Vietnamese companies.
Details of the income received by Mr Phan from the two companies in 2017
are as follows:
Description TAC Co KNT Co
Salary VND 55 million/month VND 10 million/month
Training allowances VND 96 million VND 360 million
Personal income tax Borne by employer Borne by employer

Employee insurance contributions Borne by Mr Phan N/A
Mr Phan has a son, Van Phan, who is 16 years old. From January 2018,
Van has been enrolled to study in a secondary school in Australia.
Capped for compulsory insurance in 2018 is VND26 million.
Required:
Calculate (in VND millions, rounded to one decimal) Mr Thinh Phan's

taxable income and personal income tax (PIT) liability in respect of
his employment income for the year 2017. (7 marks)
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December 2019
You should assume that today's date is 31 December 2018.
Ms Y Nguyen, a 40-year-old Vietnamese citizen with two children under 18

years old, became a manager for WSU Co, a foreign invested company in
Vietnam, on 1 May 2018. Before joining WSU Co, she worked for VS JSC,
a Vietnamese joint stock company, the shares of which were listed on the
Vietnamese stock exchange until 30 April 2018.
Her income in 2018 includes the following (her remuneration packages

from both companies were net of personal income tax (PIT)):
VS JSC WSU Co
VND million VND million
Monthly salary 40 60
Monthly petrol allowance in cash 20 0
Tet bonus (received in February 2018) 120 0
In December 2018 she also received a 13th month salary from WSU Co,
pro-rata based on her working time during the year. Base salary for 2018
is VND27.8 million per month.
Required:
Calculate (inVND millions, rounded to one decimal) the gross monthly

taxable income from each company, and the monthly and annual personal
income tax (PIT) liabilities of Ms (a) Calculate (in VND millions, rounded to
one decimal) the gross monthly taxable income Y Nguyen in 2018.
(12 marks)
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CALCULATION PRESENTATION FOR MANY INDIVIDUALS

December 2020:
MEL Co employs the following Vietnamese employees in its Hanoi office.

Their annual net remuneration and number of dependants for 2019 is
summarised as follows:
Salary Ad-hoc bonus Uniform Number of
allowance in dependants
cash
VND million VND million VND million
Tai Em 960 480 15 2
Truong Hong 480 100 10 3
Nguyen That 320 190 8 1
Doan Gioi 120 0 3 2
Employee mandatory insurance contributions were born by the employees.

Capped base salary for insurance is VND29.8 million per month.
Required:
(a) Calculate (in VND millions, rounded to one decimal in all calculations)
the gross taxable income, personal deductions, social, health and
unemployment insurance contributions and the annual personal income
tax (PIT) liability of each of the four employees of MEL Co. (13 marks)
(b) Briefly state the administration requirements for a taxpayer to claim

dependant relief for an eligible dependant, if the dependant is under the
joint care of more than one taxpayer. (2 marks)
(15 marks)
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9. OVERSEAS TAX CREDIT CLAIM VS. TAX

EXEMPTION UNDER DOUBLE TAX AVOIDANCE
("DTA") AGREEMENT
9.1. Overseas tax credit claim

ü Apply for Vietnam tax resident;
ü Overseas tax credit claim = deduction from Vietnam tax liability

if individual have paid PIT in overseas on his/her overseas
sourced income
ü Allowable tax credit = lower of (i) actual overseas tax payment

and (ii) the amount of Vietnam's tax allocated to the overseas
income using the following formula:
Vietnam's tax Total Vietnam's tax Overseas sourced income

allocated to overseas = on total taxable x
Total income
income income
Example
Andy worked under Vietnam assignment Vietnam from 2020-2022, earning

USD3,000 per month. At the same time, he is also in charge of other
regional management works for the group and is paid with total
employment income of USD5,000 per month by the group in Singapore.
Singaporean tax of USD1,000 per month was withheld by his employer.
Andy has no dependents and is responsible for his PIT for both Vietnam
and Singapore.
Exchange rate (USD/VND) = 23,500
Please calculate the payable PIT in Vietnam in 2021, take into account the
tax credit.
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9.2. Tax exemption under DTA Agreement

ü Apply for Vietnam non-tax resident
ü For country that signed DTA with Vietnam already
ü DTA exemption, where applicable, on Vietnam tax

imposed Vietnam-sourced income
ü Vietnam tax exemption does not automatically apply, but

the tax payer should submit statutory dossiers to the Tax
authority in Vietnam (i) 1st application and (ii) update Tax
Residency Certificate of other country.
ü To review specific DTA for particular cases

C. BUSINESS INCOME
1. OVERVIEW
Business income is income from production or trading activities including:
ü Production/trading of goods, provision of services such as renting

house/assets, construction, transportation, etc.
ü Independent practicing individual under field that being granted with

professional certificate
Note: there is no clear guidance on distinguish between business income

and employment income. Generally, if individual has a practicing certificate
("giáy phép hành nghề”) or business registration certificate ("giấy chứng
nhận đăng ký kinh doanh") and/or the contract signed is not labour
contract/employment contract, the income would be considered as
business income.
2. PIT on business income for TAX RESIDENT
2.1. Deemed method (on annual basis)

ü Individual has business income with annual taxable income from VND
100 million (average monthly VND8.3 mil), subject to (i) deemed PIT
and (ii) deemed VAT.
ü In case not operating full year, consider average monthly taxable
income to determine whether individual pay PIT in this year or not?
Example: Herry started business from April 2015, and the estimated
deemed taxable income is VND90 million for 9 months. Please advise if he
is subject to tax for business income?
Average monthly income = VND 10 mil > VND8.3 mil => subject to tax
ü In case of business household where there are many individuals, the

threshold is calculated for a representative
Example: A business household established by 4 family members has

revenue is VND180 million > VND100 million è the business household is
subject to tax
ü Tax calculation
PIT = Taxable income X deemed PIT rate
VAT = Taxable income X deemed VAT rate
Deemed PIT rate & Deemed VAT rate:
PIT rate VAT rate

Type
(%) (%)
Trading 0.5 1
Services, construction exclusive of materials 2 5
Manufacturing, transportation, construction inclusive of

1.5 3
materials
Other activities 1 2
Taxable income = gross deemed business income + income on VAT

invoices, if the individual uses invoices from tax authorities.
If the individual has many activities, the individual is required to separate

income of each activity and relevant deemed tax rates. Otherwise, highest
tax rate shall apply
Administration
ü Individual determines business income of next year from 20 Nov to 15

Dec or 10 days from the day starting business/changing scale of
business, activities. Then, the tax authorities consider and notify
deemed business income by 20 Jan. The deemed taxis paid at end of
each quarter.
ü If the individual uses invoices of tax authorities, the taxes based on

invoices are declared and paid quarterly, i.e. deadline is 30th day of
the following quarter.
ü Tax deduction in cases:
- cease (temporarily or permanently) of business,

- calamity, fire, accident, fatal disease
- tax change the form of tax declaration
2.2. PIT based on occasion basis

ü Individual pay PIT on occasion basis for:
- Resident has business income outside Vietnam
- Irregular business income and no fixed business place
- Business cooperation with organization and the business income

is determined
ü Individual has business income with annual taxable income from VND
100 million (average monthly VND8.3 mil) for all contracts, if any in
calendar year, subject to (i) deemed PIT and (ii) deemed VAT.
Example: Nash have irregular business income from the following

contracts in 2015:
- Contract with Company X value for VND40 mil

- Contract with Company Y value for VND50 mil
- Contract with Company Z value for VND20 mil
Whether Nash subject to tax or not?
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ü Tax calculation
VAT = Taxable income X deemed VAT rate
Deemed PIT rate & Deemed VAT rate: refer 2.1 above
Taxable income = gross business income, including penalties received
ü Taxable time:
§ Service: earlier of time when service is completed or invoice is

issued
§ Goods: earlier of time when title of goods is transferred or invoice

is issued
§ Construction: when hand-over the construction item
Administration: Quarterly basis (i.e. deadline is the 30th day of the following
quarter)
2.3. PIT on rental income

ü Rental income is income from leasing out assets: such as house,
factory, warehouse, transportation vehicle, etc.
ü Individual has business income with annual taxable income from

VND100 million (average monthly VND8.3 mil), subject to (i) deemed
PIT and (ii) deemed VAT.
ü Rental payment is paid in advance for many years, the threshold of

VND100 million is rental income for each calendar year.
Example: Carosou has a house for lease from October 2015 to September
2017. The monthly rental income VND10 million and rental fee is paid one
time when signing the contract. Determine his taxable income from leasing
Calendar year 2015: VND30 mil < VND 100 mil => not taxable
Calendar year 2016: VND120 mil > VND100 mil => taxable
Calendar year 2017: VND90 mil < VND100 mil => non-taxable
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ü Asset is owned by many individual è the threshold is calculated for a

representative
Example: A & B co-own apartment. In 2015, they mutually agree to lease

for VND180 mil per year and A is representative to perform the PIT on
behalf. A subject to PIT and have to declare rental income on VND180 mil
per year
ü Tax calculation
PIT = Taxable income X 5%
VAT = Taxable income X 5%
Taxable revenue = gross rental income, not including penalties received.
ü Taxable time: in full at time of receiving payment, including receipt

rental income in advance for many years
Administration
ü Direct method: Individual can choose to declare on (i) payment basis

or (ii) annual basis directly with the Tax authority.
§ Payment basis: the deadline of declaration and payment is the

30th day of the following quarter from the date of payment.
§ Annual basis: the deadline of declaration and payment is the 90th

day of the following year.
ü Indiect method: In case (i) lessee is corporate and (ii) lessing

agreement stated that lessee take responsibility to declare tax, the
lessee shall withhold and declare tax on behalf
2.4. PIT on agent for lottery, insurance, multi-level

trading
ü Income from lottery agents, insurance agents and multi-level trading
is subject to PIT if the annual income is more than VND100 million.
ü Income from lottery agents, insurance agents and multi-level trading

include all commissions in any form, support and other income
received
ü Tax calculation:
PIT = Taxable income X 5%
VAT = Taxable income X 5%
ü Taxable time: time of receiving payment
Administration
ü The paying organization will declare, withhold and pay on monthly or

quarterly basis
ü At the year end, if any change in the tax withheld, the individual will
finalise tax
3. PIT on business income for NON-RESIDENT
ü Tax calculation
Deemed PIT rate & Deemed VAT rate:
PIT rate VAT rate

Type
(%) (%)
Trading 1
Services 5 Not clear
Manufacturing, transportation, construction, other activities 2
Taxable income: similar to tax resident case

D. BUSINESS INCOME
CAPITAL INVESTMENT
1. Overview income individual receive from
- Interest receipt from lending/ bonds
- Dividend receipt from buying capital/ capital investment
- Capital appreciation upon liquidation/ merger/ consolidation, etc...
- Dividend paid in term of stock.
- Dividend paid by increasing capital
2. Taxable time
- Interest, dividend from buying capital/ capital investment, capital
appreciation upon liquidation/ merger/ consolidation, etc...: when
individual actually receive income
- Dividend paid in term of stock: when individual transfer the stock
- Dividend paid by increasing capital: when individual transfer the

capital
3. Non-taxable income
- Interest from credit institutions/ branches of foreign banks/ life
insurance contract/ Government's bonds
- Dividends of private company, one-member limited company owned

by an individual
4. Tax calculation: apply for both (i) tax resident and (ii) non-tax
resident
PIT Taxable income x 5%

CONTRIBUTED CAPITAL TRANSFER

1. Overview income individual receives from transferring
contributed capital
2. Taxable time
- General: when contract for transferring contributed capital effect
- Contributed by capital (góp vốn bằng phần vốn góp): when

transferring capital
3. Non-taxable income N/A

4. Tax calculation
ü Tax resident
PIT = 20% on profit = 20% x (selling price - historical cost - relevant expenses)
ü Non-tax resident
PIT = 0.1% on proceeds
STOCK TRANSFER
1. Overview income individual receives from transferring
stock from normal stock, reward stock, stock option,
bond, fund certificate, etc... per Stock Laws
Stock option scheme
Grant Vest Exercise Transfer Expire

Date Date date date date
2. Taxable time
- Stock from public company transfer via Stock Exchange: when
individual receives income from transferring stock
- Stock from public company not transfer via Stock Exchange: when
individual transfer stock ownership at Stock Depository
- Overseas stock: when stock transfer/ contract transfer effect
- Contributed capital by stock: when stock transfer
- Divident paid in term of stock: when stock transfer

4. Tax calculation apply for both (i) tax resident and (ii)
non-tax resident
PIT = 0.1% on proceeds
REAL ESTATE TRANSFER

1. Overview income individual receives from:
- Transfer Land use right ("LUR");
- Transfer LUR associated with assets, i.e. house/ house forming in

the future/ insfastructure, etc.
- Transfer Ownership of house/ house forming in the future
- Transfer Right to lease land/water surface, right to use resident

houses
- Contribute capital/ capital increase by real estate

2. Taxable time
- Seller (contract not clearly stated): when transfer contract effect
- Buyer, on behalf of seller to declare tax (contract to clearly state

the obligation of buyer): when carry out the procedure to transfer
ownership;
- Transfer between qualified relatives (wife - husband, parent/
parent in laws - child, grandparent grandchild, brothers)
- Separate real estate form during marriage period (mutual assets)

for both (i) negotiation and (ii) by court
- Transfer real estate qualifies all of 3 conditions: (i) as only

ownsership at transferring time and (ii) take ownership for more
than 183 days (iii) transfer whole asset
4. Tax calculation apply for both (i) tax resident and (ii)
non-tax resident
PIT = 2% on proceeds
PRIZE WINNING/ GIFT/ INHERITANCE

1. Overview
ü Prize winning: both in cash & in kind receive in term of
(i) winning lottery from lottery company

(ii) winning as commercial marketing under Commercial Laws
(iii) winning casino allowed by Laws
(iv) winning in games organized by other business establishment,
individual, etc...
ü Gift/ Inheritance: receive in term of

(i) Stock
(ii) capital
(iii) real estate
(iv) Other assets that should register ownership (i.e. bike, car,
etc...)
2. Taxable time
ü Prize winning: when winning granted
ü Gift/ inheritance: when carry out ownership transfer procedure
ü Prize winning: N/A
ü Gift/ inheritance:
(i) Real estate received from qualified relatives (wife - husband,
parent/ parent in laws child, grandparent - grandchild,
brothers)
(ii) Remittance from relatives from overseas.
4. Tax calculation
PIT (Taxable income - VND10 mil) x 10%
COPYRIGHT/ ROYALTY/ FRANCHISING

1. Overview
ü Copy right/ Royalty: income receives from transferring copy right/
royalty/ technology in accordance with Illectual ownership Laws and
Technology transfer Laws
ü Franchising: income receives from franchise contract

2. Taxable time When fee is paid (receipt)

4. Tax calculation
PIT (Taxable income - VND10 mil) x 5%
MULTIPLE CHOICES
1. When is PIT declared on Share awards?
a. Granting day
b. Transfer day
c. Both a and b are correct
d. Both a and b are incorrect
2. What is tax treatment for Share award granted to the employees?

a. Only PIT on employment income shall trigger when shares awards
granted to the employees
b. Only PIT on share transfer imposes when such shares are transferred
c. If transfer price is lower than book price, no PIT impose
d. a, b, c are all incorrect
3. A wins a prize of VND100,000,000 from lottery tickets. How much

PIT is he required to pay to the tax authority?
a. VND 4,500,000
b. VND 5,000,000
c. VND 9,000,000
d. VND 10,000,000
4. Ms Thu was one of the founding members of C Ltd. In 2016, she sells
5% charter capital in C Ltd at VND3,000,000,000. Her original contributed
amount of VND 1,000,000,000 for such 5%. For this sale Thu has paid
brokerage fee of 2% on sale price, legal fees of VND 10,000,000 for her
lawyer in drafting the sale agreement. In addition, Thu claimed that she
has paid interest of VND100,000,000 for the loan she borrowed to
contribute to the company, however after she borrowed the money, Thu
has invested in many companies and is unable to provide any documents
proving that the loan was only used for capital contribution to C.
Please calculate Thu's PIT liability for the above transaction in 2016
A. 386 mil VND
B. 366 mil VND
C. 600 mil VND
D. 586 mil VND
5. Ms Ha has the following income in 2016 - Received interest of

VND500,000,000, including:
(i) VND300,000,000 from her deposits at the branch of a foreign bank
(ii) VND200,000,000 from lending money to her investee companies.
Please calculate Ms Ha's PIT liability on the above income
A 25 mil VND
B 20 mil VND
C 15 mil VND
D 10 mil VND
6. Mr. Smith & Ms. Smith got married in 2016 and bought a new apartment
value for VN3 bil in District 2. Before getting marriage, Mr. Smith owned
other apartment value for VND2 bil in District 7. In the early of 2017, Mr.
Smith & Ms. Smith decided to sell the apartment in District 2 for VND3.5
bil. Assuming each of them own 50% of the apartment
Please calculate PIT liability of Mr. Smith and Ms. Smith, respectively
from transferring the apartment in District 2
A Both are exempt for PIT
B Both bear PIT of VND35 mil, individually
C Mr. Smith got PIT exemption while Ms. Smith bear PIT of VND35 mil
D Mr. Smith bear PIT of VND35 mil while Ms. Smith got PIT exemption
7. The same background of Question 6 above
At the last minutes, Ms. Smith decided to transfer her part while Mr. Smith
refused to transfer. Assuming regulations allow to transfer partly.
Please calculate PIT liability of Ms. Smith for transferring apartment in

District 2
A. PIT exemption
B. PIT of VND 30 mil
C. PIT of VND 35 mil
D. PIT of VND 70 mil
June 2019: In February 2018, Mr May and Ms Man, two Vietnamese tax
residents, were the equal co-winners of a promotion prize, a car which had
a market value of VND990 million, inclusive of 10% VAT, from a real estate
company.
What is the amount (in VND million, rounded by one decimal) of Ms

Man's personal income tax (PIT) liability on the above promotion
prize?
A VND 48.5 million

B VND 44-5 million
C VND 49.0 million
D VND 44.0 million
June 2019: In 2017, Ms Mai Pham, a Vietnamese citizen, purchased

100,000 shares in TBC Bank in 2017 when the price per share was
VND30,000 (three times par value). The shares were listed on the official
stock exchange and in 2018, TBC Bank announced a 20% dividend per
share, of which half would be paid in cash and half in the form of bonus
shares. The market price of the shares at the time of announcement was
VND50,000 per share. Ms Mai Pham had no intention of selling these
shares in 2018.
What is Ms Mai Pham's Vietnamese personal income tax (PIT) liability

(in VND million) in the year 2018 in relation to the dividend?
A VND 5 million
B VND 15 million
C VND 25 million
D VND 0 million
WRITING QUESTIONS
IMPORTANT EXAMPLES ON SHARE/ STOCK
- In 2013, Mr Chris bought 10,000 shares at VND 15,000/ share

- In 2014, he received 5,000 share (*)
- In Feb 2017, he sold 2,000 shares at price of VND 30,000/ share
- In Aug 2017, he sold 7,000 shares at price of VND 20,000/ share
Nominal/ book value of shares is VND 10,000/ share.
Determine PIT imposed in 2 cases, where 5,000 shares received in 2014

is:
(i) Share awards from employment relationship; OR
(ii) Share paid as dividend from investment;

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December 2019
Mr Quach Hoai is a 35-year-old Vietnamese citizen and is the IT Manager

for FRS Co, a company in Vietnam. In 2018, his gross remuneration
received from FRS Co included a salary of VND30 million per month plus
an annual bonus equal to two month salary. In addition, he also performed
services for various other organisations and earned other income as
described below. All income is gross of personal income tax (PIT) unless
otherwise stated.
Services performed:
- Website design for three companies, for a total fee of VND80 million. The
net fee received by Quach was VND72 million, after the companies
withheld provisional PIT at a rate of 10%.
- IT e-learning courses delivery for EDM Co for a training fee of VND450

million (the content, materials and design of the courses were prepared by
EDM Co). The fee received was net of 10% PIT withheld by EDM Co.
Other income:
- Dividends of VND300 million received from ITPro Co, a limited liability

company in Vietnam. Quach contributed capital of VND100 million to set
up the company with his friends five years ago.
- Sale of all of his capital contribution to ITPro Co for VND2,000 million.
Throughout 2018 Quach was single and was taking care of his parents,
both of whom were beyond working age and had no income. Base salary
2018 is VND27.8 million per month.
Required:
Calculate the taxable income and PIT liability (in VND million, rounded to
one decimal) of Mr Quach Hoai in Vietnam in the calendar year 2018.
(8 marks)
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June 2017
Ms Lan Tam is 40 years old, and a Vietnamese citizen. She is divorced

and is bringing up her two children who were born in 2001 and 2005,
respectively. In 2016, she has been working two jobs at the same time as
follows:
- Full-time at JWM Co, for a net salary of VND120 million per month plus a
bonus equal to two months' salary. She is responsible for her own
compulsory insurance in respect of this employment.
-Part-time at CNL Co, for a net salary of VND15 million per month. No
insurance is covered by CNL Co in respect of this employment. On 1
September 2016, Ms Lan Tam decided to quit the job at CNL Co to have
more time for her children.
Base salary for compulsory insurance for 2016: VND24.2 million per
month
Ms Lan Tam also maintains a portfolio of investments, which earned her

the following amounts in 2016:
- VND100 million cash from bond interest.
- VND120 million cash from dividends distributed by TCL Co, a non-public

joint stock company (representing a yield of 10% over face value).
- 20,000 shares of PDL JSC, a listed company, as a scrip dividend in

respect of the 120,000 shares she held in March 2016. At the time of this
distribution, the market price of PDL JSC shares was VND18,000 per
share.
On 1 September 2016, Ms Lan Tam sold all of her shares in PDL JSC and
TCL Co at the price of VND20,000 and VND 16,000 per share,
respectively..
The face value of both companies' shares is VND10,000 per share.
Required:
(a) Calculate Ms Lan Tam's taxable income and personal income tax (PIT)
liability in respect
of her employment income for the year 2016. (8 marks)
(b) Calculate the PIT liability of Ms Lan Tam for the year 2016 in respect
of the following investment activities:
- the receipt of the interest and cash dividend;
- the receipt of the scrip dividend; and
- the sale of the PDL JSC and TCL Co shares). (7 marks)
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December 2016
Mr Nghia Phan, who is 45 years old and a Vietnamese citizen, is the

general director of HMCP JSC (HMCP) a company listed on the
Vietnamese stock market.
According to his labour contract with HMCP, Mr Nghia Phan's monthly

gross income is VND300 million (covering all benefits in cash and in kind
and all taxable). He is also entitled to incentives based on the performance
of the company.
At the end of 2014, HMCP offered Mr Nghia Phan a 'cashing shares award'
scheme as an appendix to his labour contract, by which he would receive
a nominal award of 1.5 million shares of HMCP (with no dividend and
voting rights). On 31 December 2015, HMCP would pay him an 'award'
equal to the difference between the share price at the beginning of 2015
(of VND12,000 per share) and that on 30 December 2015. In 2015, HMCP
made a substantial profit and the share price on 30 December 2015 had
increased to VND20,000 per share.
The board of directors was very happy with Mr Nghia Phan's performance
in 2015 and they are considering offering him additional incentives as
follows:
- Option 1: a special cash bonus of VND4,800 million, payable immediately

on 31 December 2015; or
- Option 2: a cash bonus of VND1,600 million, plus 150,000 shares to be

awarded with full rights to receive dividends, payable immediately on 31
December 2015. The board plans to make a dividend payment for 2015 of
VND1,000 per share in April 2016.
Mr Nghia Phan has three dependants, being his children. His compulsory
insurance is calculated based on the cap of VND23 million per month.
Required:
(a) Describe the personal income tax (PIT) treatment of (1) the 'cashing
shares award' scheme and (2) the shares awarded under Option 2 above.
(5 marks)
(b) Calculate (in VND millions) Mr Nghia Phan's PIT liability in Vietnam in
the year 2015 under Option 1 above. (5 marks)
(10 marks)
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June 2020
Mr Ha Nguyen is a Vietnamese citizen and is the chief financial official of

TBC JSC, a company listed on the Vietnamese stock market. In 2019, his
gross income was VND 100 million per month, comprising salary,
allowances and compulsory insurance. Ha is 45 years old, and is single
with no dependants.
On 31 December 2018, given his exceptional performance in the fiscal year

2018, Ha was awarded the following:
- Actual share award: 100,000 ordinary shares in TBC JSC, free of charge.
- Cashing share award: A nominal award of 500,000 special shares in TBC

JSC, with no right to a dividend or votes, nor any other right given to holders
of ordinary shares. On 31 December 2019, TBC JSC paid Ha cash equal
to the difference between the share price at 31 December 2019 and the
share price at 31 December 2018.
- Share options: Options to purchase 500,000 ordinary shares at nominal

value. The options are exercisable wholly or partly at any time from 1
January 2019.
Ha held no shares in TBC JSC before these awards were made. The
nominal value of one ordinary share is VND 10,000.
In February 2019, Ha decided to sell 50,000 shares when the share price
was VND 30,000 per share, and used the entire proceeds (after personal
income tax (PIT) on transfer of securities) to exercise a part of the share
options. These were the only shares sold by Ha during the fiscal year
2019.
In March 2019, TBC JSC paid a dividend of VND 5,000 per share in cash
to all investors who held shares on 1 March 2019, and offered all existing
investors a bonus of one share for every four shares held.
On 31 December 2018, the price of one share in TBC JSC was VND
25,000. On 31 December 2019, the price of one share in TBC JSC was
VND 28,000.
The local tax authorities instructed TBC JSC that, for personal income tax
(PIT) purposes, the taxable employment income of the actual share award
(upon any sales of the company's shares by the receiving employee after
the award) would be the market value of the shares on the date of the
award, on the basis that this would be the amount the recipient would earn
from employment if they were to sell the shares immediately upon the
shares being awarded.
Base salary for 2019 is VND29.8 million.
Required:
(a) Calculate the personal income tax (PIT) liability on the transfer of
securities and investment income (in VND million, rounded to two
decimals) of Mr Ha Nguyen in the calendar year 2019. (5 marks)
(b) Calculate the personal income tax (PIT) liability from employment
income (in VND million, rounded to one decimal) of Mr Ha Nguyen in
the fiscal year 2019. (5 marks)
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December 2017
Mr Tony Phu, a 40-year-old Vietnamese citizen, is married with two

children, a ten-year-old daughter and a six-year-old son. In 2016 Tony was
promoted to become the general director of GIV JSC, a Vietnamese joint
stock company with diversified operations in various sectors in Vietnam,
including retail outlets and education. Tony's gross-of-tax remuneration
package for 2016, as stated in the labour contract, is as follows:
- Salary: VND580 million per month, with two additional monthly salaries
to be received in February and December.
- Incentive bonus: an award of 100,000 shares of GIV JSC if he

successfully achieves the corporate performance as set out at the
beginning of 2016. Tony can choose to receive either the shares or cash
equivalent to the market share price as at 31 December 2016. In both
cases the award will be made in June 2017
- Car rental for transporting Tony from home to office and office to home:
VND30 million per month to be paid directly to the lessor by GIV JSC
- Medical insurance fee (non-accumulative): VND180 million per year in

total for the six persons in Tony's family (himself, his wife, his two children
and his parents). An equal fee is payable for each person. The insurance
covers medical expenses up to VND1 billion per year for each insured
person.
- Membership fee for golf club: VND 160 million per year. The membership
card is issued specifically to Tony.
- Share options to purchase 50,000 shares of GIV JSC at the nominal

value of VND10,000 per share at the beginning of 2016. These options had
to be mandatorily exercised on 4 January 2016 (i.e. Tony had to purchase
the shares on that date), and the purchase cost of VND 500 million was to
be deducted from the additional salary he received in February 2016. The
shares were sold on 31 December 2016 at their market price and the
proceeds paid in cash to Tony on the same date.
As a standard benefit offered to all management positions, Tony's children

can study in a school established and operated by a subsidiary of GIV JSC,
with the tuition fees settled directly by GIV JSC to this subsidiary with valid
supporting documents. The fees quoted by the school for pupils at the
grades of Tony's daughter and son are VND 150 million and VND 100
million per annum, respectively. The school has a general policy
(applicable to everyone) to offer a 5% discount for the second child of a
family enrolled with the school.
The market price of the GIV JSC shares as at 4 January 2016 and 31
December 2016 was VND 45,000 and VND 48,000 respectively.
On 6 August 2016, GIV JSC paid a dividend of VND6,000 per share held
(including the shares received from the exercise of the share options)
GIV JSC has obtained guidance from the tax authorities instructing that the
share options are taxable in the year when the shares are sold, and that
the taxable employment income is the difference between the market price
at the time of exercise and the exercise price (i.e. the price which the
employee has to pay for the shares).
Tony is responsible for his personal income tax (PIT), as well as the
social, health and unemployment insurance contributions payable on his
part. Tony's wife and parents all have income in excess of an average of
VND1 million per month. Base salary for 2016 is VND 24.2 million.
Required:
(a) Determine (in VND millions) Mr Tony Phu's taxable income and
non-taxable income for the year 2016, and taxable income in future
years for personal income tax (PIT) purposes with respect to his
employment income.
Note: You should present your answer in tabular form with the headings
'Taxable in 2016,' 'Non- taxable in 2016' and 'Taxable in the future', listing
all of the relevant items referred to in the question in the appropriate
column. (8 marks)
(b) Calculate (in VND millions rounded to one decimal) Mr Tony Phu's
monthly taxable income and the total PIT liability in respect of his
employment income for the year 2016. (4 marks)
(c) Briefly explain the tax rates and timing of taxation in respect of the
following items of Mr Tony Phu's investment income for the year
2016:
- the sale of the shares received as an incentive bonus;
- the sale of the shares received from the exercise of the share
options; and
- the dividend from the shares.
Note: You are not required to calculate the tax payable in this part. (3
marks)
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June 2017
Mr Hung Duong and Ms Hien Duong are brother and sister. In 2013, they
inherited a piece of land of 500 square metres in the city downtown from
their parents, for which they have duly settled all personal income tax (PIT)
obligations for the inheritance. There was no specific indication as to the
ratio of ownership in their parents' will or any other documents.
At the beginning of 2016, they decided to sell the land, and entered into an
agreement with an individual buyer on 1 March 2016. The agreed
contractual price was VND 200 million per square metre (being the market
price at the time of transfer), and the seller was obliged to handle the tax
filing and payment. The contract was effective from 15 March 2016 and Mr
Hung Duong registered the change in ownership on 30 March 2016.
Payments were fully settled on 1 April 2016.
After the sale of the land, on 15 April 2016, Mr Hung Duong used all of the
cash received plus 500,000 shares of ABC Co, a listed company on the
HNX Stock Exchange, to contribute capital into HD Co, a limited liability
company. At the time of contribution, the market price of the ABC Co
shares was VND 15,000 per share. The value of the capital contribution
was agreed based on the actual cash contribution and this market value
for the ABC Co shares. On 1 September 2016, Mr Hung Duong sold the
capital contribution in HD Co to Mr Nam, a Vietnamese individual, for
VND68,000 million. The market price of the ABC Co shares was
unchanged.
Required:
(a) Determine the taxing date for personal income tax (PIT) purposes
of the land sale made by Mr Hung Duong and Ms Hien Duong,
according to Circular 92/2015. (2 marks)
(b) State the basis on which the taxable income on the land sale will
be allocated between Mr Hung Duong and Ms Hien Duong and
calculate (in VND millions) the PIT liability, if any, payable by Mr Hung
Duong. (3 marks)
(c) Briefly explain the tax treatment of the capital contribution made
to HD Co by Mr Hung Duong on 15 April 2016 and calculate (to the
nearest VND millions) the PIT liability incurred, if any. (2 marks)
(d) Calculate (to the nearest VND millions) the PIT liability incurred by
Mr Hung Duong, if any, in respect of the sale of the capital
contribution in HD Co on 1 September 2016. (3 marks)
(10 marks)
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Acca - F6 Pit

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Personal Income Tax (PIT) 1

Personal Income Tax (PIT) 2

1. The scope of personal income tax (PIT)

b) Explain how the tax residence of an individual is determined.

c) Recognise the difference in the tax treatment of a resident

d) Recognise the difference in the tax treatment of income sourced

e) Understand how a double taxation agreement can affect the

2. Income subject to PIT

b) Identify exempt income, allowances, benefits and receipts not

c) Distinguish between income which is subject to progressive PIT

d) Explain how the attribution of income is determined

e) Explain how the income of individuals in the capacity of producers,

f) Explain the treatment of business income, salary income, income

Excluded topics - Agricultural income of small scale producers

3. The comprehensive computation of monthly and

b) Compute other taxable income and distinguish its treatment from

d) Recognise the individual income of non-residents subject to

e) Compute the monthly and annual tax liabilities of residents and

f) Compute any available tax credit and double taxation relief in

4. The use of exemptions and reliefs in deferring and

b) Explain how alternative structuring of all types of income can result

Excluded topics - Detailed provisions of individual tax treaties

A. THE SCOPE OF PIT

The PIT law applies to individuals, who have taxable income,

IN THIS WORLD nothing is certain but DEATH TAXES

a. Tax Residents: individuals who meet one of the following

ü Regular place of resident in Vietnam:

- registered permanent residence place (Vietnamese: household

- leased residence in Vietnam with terms from 183 days

Evidence to prove tax resident status:

Matrix to determine residency status:

Having regular Tax resident (unless he is a tax

Not having regular

§ Day-count is based on calendar days (not working days)

§ Regardless the purpose of the visit (i.e. working/ holidays/visiting

Example: Determine number of days present in Vietnam for PIT purposes

Date come to Date leave Days present in Vietnam for PIT

1 Jan 2017 3 Jan 2017 ………………………………………………….

1 Jan 2017 2 Jan 2017 ………………………………………………….

1 Jan 2017 1 Jan 2017 ………………………………………………….

Tax residents subject to Vietnamese PIT on worldwide taxable

b. Tax non-residents: individuals NOT meeting the conditions for being

Tax non-residents subject to Vietnam PIT on the Vietnam

Example: Mr. Thomas is a tax resident in Singapore and does not

Which of the following is correct?

3. TAX YEAR (TAXABLE PERIOD)

ü Yearly tax declaration: employment income

§ Stay in Vietnam for 183 days or more in a calendar year since

ü One-off tax declaration: other types of income

b. Tax non-resident: One-off declaration

December 2015: Mr Tomaz is a Hong Kong citizen and tax resident. He

- From 21 April to 31 December 2014 130 days

Based solely on the above information, what is Mr Tomaz's tax residency

First year Second year

Example: Kobe Bryan is a foreigner who first comes to Vietnam on April

Please identify his residency status in 2 relevant tax years.

First year Second year

Type of income subject to PIT

1. Incomes from business