How to calculate the personal income tax refund in 2025?

What are the conditions for personal income tax refund in Vietnam in 2025?

Based on Article 28 of Circular 111/2013/TT-BTC which stipulates the conditions for personal income tax refund, as follows:

Tax Refund

1. Personal income tax refund applies to individuals who have registered and have a tax code at the time of filing the tax finalization dossier.

2. For individuals who have authorized tax finalization to the organization or individual that pays the income to finalize on their behalf, the tax refund is carried out through the income-paying organization or individual. The income-paying organization or individual executes the balancing of overpaid and underpaid taxes of the individuals. After balancing, if there are overpaid taxes, they will be offset into the next period or refunded if a refund is requested.

3. For individuals who directly declare with the tax authority, they may choose to refund or offset into the next period at the same tax authority.

4. In cases where individuals have a personal income tax refund arising but are late in submitting the tax finalization declaration as prescribed, no penalty will be applied for administrative violations of late tax finalization submission.

In addition, based on Clause 2, Article 8 of the Personal Income Tax Law 2007 which regulates tax management and tax refund, as follows:

Tax administration and Refund

1. Taxpayer registration, declaration, deduction, payment, finalization, refund, handling of tax-related legal violations, and tax management measures are implemented as per the provisions of tax management law.

2. Individuals are eligible for tax refunds in the following cases:

a) The amount of tax paid is greater than the amount of tax payable;

b) Individuals have paid taxes but have taxable income below the taxable threshold;

c) Other cases as decided by competent state authorities.

Therefore, based on the above regulations, the conditions for a personal income tax refund in 2025 are specifically as follows:

- Individuals who have paid more personal income tax than the payable amount;

- Individuals have paid taxes but have taxable income below the taxable threshold;

- The tax refund applies to individuals who have registered and have a tax identification number at the time of submitting the tax finalization dossier.

Note:

- For individuals who have authorized tax finalization to the organization or individual that pays the income to finalize on their behalf, the tax refund is carried out through that organization or individual.

- The income-paying organization or individual executes the balancing of overpaid and underpaid taxes of the individuals.

- After balancing, if there are overpaid taxes, they will be offset into the next period or refunded if a refund is requested.

- Individuals who declare directly to tax authorities may choose to refund or offset into the next period at the same tax authority.

- In cases where individuals have a personal income tax refund arising but are late in submitting the tax finalization declaration as prescribed, no penalty will be applied for administrative violations of late tax finalization submission.

How to calculate the personal income tax refund in Vietnam in 2025?

Based on the regulations in the Personal Income Tax Law 2007 and the content of Form No. 02/QTT-TNCN issued together with Circular 80/2021/TT-BTC, the overpaid personal income tax is calculated as follows:

Where:

+ Paid Personal Income Tax Amount: is the amount that the individual has been deducted and paid into the state budget.

+ Payable Personal Income Tax Amount according to the tax finalization = (Total taxable income – Total deductions) x Tax rate

This is the amount of tax that the individual must pay according to the tax finalization. This tax amount is calculated based on legal regulations on taxable income, deductions, and tax rates.

To calculate the refundable personal income tax amount, you must know the exact amount of tax temporarily paid and the payable tax amount.

How to calculate the personal income tax refund in 2025? (Image from the Internet)

What is the processing time for personal income tax refund claims in Vietnam in 2025?

Based on Article 75 of the Tax Administration Law 2019 (some contents are annulled by Clause 13, Article 6 of the Law amending the Laws on Securities, Accounting, Independent Auditing, State Budget, Management and Use of Public Assets, Tax Administration, Personal Income Tax, National Reserve, Handling Administrative Violations 2024), which regulates the processing time for tax refund claims as follows:

Processing Time for Tax refund claims

1. For dossiers eligible for a pre-refund, no later than 06 working days from the date the tax administration authority has a notice of acceptance of the dossier and the processing time for the tax refund claim, the tax administration authority must decide to refund the tax to the taxpayer or notify the conversion of the taxpayer’s dossier to pre-refund inspection if it falls under the case prescribed in Clause 2, Article 73 of this Law or notify no refund to the taxpayer if the dossier does not meet the refund conditions.

If the information declared on the tax refund claim differs from the management information of the tax administration authority, the tax administration authority notifies the taxpayer in writing to explain and supplement information. The time for explanation and supplementing information is not counted in the processing time for the tax refund claim.

2. For dossiers subject to pre-refund inspection, no later than 40 days from the date the tax administration authority has a written notice of acceptance of the dossier and the processing time for the tax refund claim, the tax administration authority must decide to refund the tax to the taxpayer or not refund the tax to the taxpayer if the dossier does not meet the refund conditions.

Depending on each type of tax refund claim, there will be different processing times for the personal income tax refund, specifically:

(1) For dossiers eligible for pre-refund:

- The processing time for personal income tax refunds is no later than 06 working days from the date the tax administration authority has a notice of acceptance of the dossier and the processing time for the tax refund claim.

- The tax administration authority decides to refund the tax to the taxpayer or notify the conversion of the taxpayer’s dossier to pre-refund inspection if the dossier does not meet the refund conditions.

(2) For dossiers subject to pre-refund inspection:

- The processing time for personal income tax refunds is no later than 40 days from the date the tax administration authority has a written notice of acceptance of the dossier and the processing time for the tax refund claim.

- The tax administration authority either refunds the tax to the taxpayer or does not refund the tax if the dossier does not meet the refund conditions.

Note:

- The processing time for personal income tax refunds is calculated in working days, excluding holidays, Tet, and weekly days off.

- In cases where the personal income tax refund claim does not meet the refund conditions, the tax administration authority must notify the taxpayer and explain the reasons.

- In the event the tax administration authority does not process the personal income tax refund within the prescribed time, it is considered a delay in processing the tax refund claim.