Individuals who are subject to personal income tax (PIT) in Vietnam are divided into two types: residents and non-residents. Residents are defined as individuals who have been in Vietnam for 183 days or more, or who have a habitual residence in Vietnam. Non-residents, on the other hand, are individuals who do not meet these criteria.
Personal incomes that are subject to PIT include salaries, wages, and other types of income such as income from business, capital investment, real estate assignment, inheritance, and more.
For residents, the taxable income from salaries and wages is calculated after deducting insurance premiums and reductions. The reduction value for a taxpayer and each of their dependents is VND 11 million and VND 4.4 million per month, respectively. The PIT rate for residents is partially progressive, with the lowest tax rate being 5% and the highest tax rate being 35%.
In the case of non-residents, the tax rate of 20% is applied to the total income from salaries and wages, regardless of the amount.
For other types of income, tax rates ranging from 0.1% to 20% are applied based on the specific type of income.