Is a TIN required for dependants to be eligible for personal exemption in Vietnam?

Is a TIN required for dependants to be eligible for personal exemption in Vietnam?

Pursuant to subsection c.2, point c, clause 1, Article 9 of Circular 111/2013/TT-BTC, the principles for calculating personal exemption for dependants of personal income taxpayers are stipulated as follows:

Deductions

1. Personal exemption

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c) Principles for calculating personal exemption

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c.2) personal exemption for dependants

c.2.1) Taxpayers are eligible to calculate personal exemption for dependants if they have registered and been issued a taxpayer identification number.

c.2.2) When a taxpayer registers for personal exemption for a dependant, the tax authority will issue a TIN for the dependant, and the temporary personal exemption can be applied throughout the year from the time of registration. For dependants already registered for personal exemption before this Circular came into effect, deductions will continue until a TIN is issued.

c.2.3) If a taxpayer has not applied for personal exemption for a dependant in the tax year, deduction can be applied from the month the obligation to provide support arises, once the taxpayer finalizes tax obligations and registers for personal exemption for the dependant. Specifically, for other dependants guided in subsection d.4, point d, clause 1 of this Article, the latest registration deadline for personal exemption is December 31 of the tax year; If this deadline is exceeded, the deduction will not apply for that tax year.

c.2.4) Each dependant is only eligible for deduction once through one taxpayer in the tax year. If multiple taxpayers share a dependant, they must mutually agree to register the personal exemption under one taxpayer.

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Simultaneously, based on clause 1, Article 29 of Circular 111/2013/TT-BTC regarding enforcement effectiveness:

Effectiveness

1. This Circular comes into effect from October 1, 2013.

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Therefore, personal income taxpayers are still eligible for personal exemptions even if dependants do not yet have a TIN, provided that dependants were registered for deduction before October 1, 2013, and deductions will continue until a TIN is issued.

Is a TIN required for dependants to be eligible for personal exemption in Vietnam? (Image from Internet)

Who are considered dependants of personal income taxpayers in Vietnam?

According to point d, clause 1, Article 9 of Circular 111/2013/TT-BTC, dependants of personal income taxpayers are defined as follows:

- Children: biological children, legally adopted children, illegitimate children, stepchildren of the wife or husband, specifically including:

+ Children under 18 years old (calculated by month).

+ Children aged 18 or older with disabilities, unable to work.

+ Children studying in Vietnam or abroad at universities, colleges, vocational schools, including those aged 18 or older still in high school (including the period awaiting university results from June to September of 12th grade) without income or with a monthly average income from all sources not exceeding 1,000,000 VND.

- Spouse of the taxpayer meeting conditions at point đ, clause 1, Article 9 of Circular 111/2013/TT-BTC.

- Biological parents; parents-in-law (or father-in-law, mother-in-law); stepparents; legally adoptive parents of the taxpayer meeting conditions at point đ, clause 1, Article 9 of Circular 111/2013/TT-BTC.

- Other individuals without caretakers whom the taxpayer is directly supporting, meeting conditions at point đ, clause 1, Article 9 of Circular 111/2013/TT-BTC including:

+ Siblings of the taxpayer.

+ Grandparents, aunts, uncles, or paternal/maternal relatives of the taxpayer.

+ Nephews/nieces of the taxpayer, including children of siblings.

+ Other individuals whom the taxpayer must directly support as per legal provisions.

Simultaneously, pursuant to point đ, clause 1, Article 9 of Circular 111/2013/TT-BTC concerning conditions for identifying dependants of a personal income taxpayer in cases of spouse, biological parents, in-laws, stepparents, legally adoptive parents, or individuals requiring direct support:

- For individuals of working age, they must simultaneously meet the following conditions:

+ Having a disability, unable to work.

+ Having no income or an average monthly income from all sources not exceeding 1,000,000 VND.

- For individuals beyond working age, they must have no income or an average monthly income from all sources not exceeding 1,000,000 VND.

May multiple personal income taxpayers register the same dependant in Vietnam?

According to subsection c.2.4, point c, clause 1, Article 9 of Circular 111/2013/TT-BTC regarding principles for calculating personal exemption:

Deductions

1. personal exemption

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c) Principles for calculating personal exemption

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c.2.4) Each dependant can be registered for deduction only once per year by one taxpayer. If multiple taxpayers share the responsibility of a dependant, they must mutually agree to designate the deduction registration under one taxpayer.

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Thus, each dependant can only be counted once for personal exemption under one personal income taxpayer. If multiple taxpayers share a dependant, they must agree to register the personal exemption under one taxpayer.