Are step children considered dependant for personal exemption when calculating personal income tax in Vietnam?

Are step children considered dependant for personal exemption when calculating personal income tax in Vietnam?

Based on the provisions at point d, clause 1, Article 9 of Circular 111/2013/TT-BTC (The contents related to personal income tax for individuals doing business in this Article are abolished by clause 6, Article 25 of Circular 92/2015/TT-BTC) which provides for personal exemptions as follows:

Deductions

The deductions guided in this Article are amounts subtracted from an individual's taxable income before determining taxable income from salary, wages, and business. Specifically:

1. personal exemptions

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d) Dependants include:

d.1) Children: biological children, legally adopted children, extramarital children, stepchildren of the wife, stepchildren of the husband, specifically including:

d.1.1) Children under 18 years old (calculated in full months).

Example 10: Mr. H's child born on July 25, 2014, is considered a dependant from July 2014.

d.1.2) Children aged 18 years or older who are disabled, unable to work.

d.1.3) Children who are studying in Vietnam or abroad at university, college, vocational schools, including those over 18 years old still pursuing high school education (including waiting for university exam results from June to September of the 12th grade) without income or have an average monthly income of all sources not exceeding 1,000,000 VND.

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Thus, registering a stepchild of the husband/wife as a dependant for family deduction in personal income tax calculations can be conducted in the following cases:

[1] Children under 18 years old (calculated in full months).

[2] Children aged 18 years or older who are disabled, unable to work.

[3] Children studying in Vietnam or abroad at university, college, vocational schools, including those over 18 years old still pursuing high school education (including waiting for university exam results from June to September of the 12th grade) without income or having an average monthly income of all sources not exceeding 1,000,000 VND.

Are step children considered dependant for personal exemption when calculating personal income tax in Vietnam? (Image from the Internet)

What documents are required to register a stepchild as a dependant for personal income tax calculation in Vietnam?

Based on the provisions at point g, clause 1, Article 9 of Circular 111/2013/TT-BTC, as amended by Article 1 Circular 79/2022/TT-BTC regarding the proof of dependants to deduct family circumstances when calculating personal income tax as follows:

[1] Children under 18 years old (calculated in full months).

Proof documents include:

- Photocopy of Birth Certificate;

- Photocopy of Identity Card or Citizen Identification (if any).

[2] Children over 18 years old who are disabled, unable to work

Proof documents include:

+ Photocopy of Birth Certificate and photocopy of Identity Card or Citizen Identification (if any).

+ Photocopy of Disability Certificate as regulated by the law on disabled persons.

[2] Children studying in Vietnam or abroad at university, college, vocational schools, including those over 18 years old still pursuing high school education (including waiting for university exam results from June to September of the 12th grade) without income or having an average monthly income of all sources not exceeding 1,000,000 VND.

Proof documents include:

+ Photocopy of Birth Certificate.

+ Photocopy of Student Card or a declaration with confirmation from the school or other documents proving enrollment at universities, colleges, vocational schools, high schools, or vocational training.

Note: In the case of a stepchild, besides the documents for each case mentioned above, proof documents need additional documentation to establish the relationship such as a photocopy of the decision on adoption, the recognition of child, father, mother from a competent government agency.

What is the personal exemption level in Vietnam in 2024?

Based on the provisions in Article 19 of the Personal Income Tax Law 2007, as amended by clause 4, Article 1 of the Amended Personal Income Tax Law 2012, Article 1 of Resolution 954/2020/UBTVQH14 (Regulations related to tax determination for business individuals in clause 1 of this Article are repealed by clause 4, Article 6 of the Law Amending Tax Laws 2014), the personal exemption is the amount subtracted from taxable income before tax calculation for income from business, wages, and salaries of tax-resident individuals.

The personal exemption includes:

- A deduction of 11 million VND/month (132 million VND/year) for the taxpayer themselves;

- A deduction of 4.4 million VND/month for each dependant of the taxpayer.