Is health insurance deductible when calculating personal income tax in Vietnam?

Is health insurance deductible when calculating personal income tax in Vietnam?

Based on Clause 2, Article 9 of Circular 111/2013/TT-BTC, specific regulations on deductible items are as follows:

Deductible Items

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2. Deductions for Insurance Contributions and Voluntary Pension Funds

a) Insurance contributions include: social insurance, health insurance, unemployment insurance, and compulsory professional liability insurance for certain occupations.

b) Contributions to Voluntary Pension Funds

The amount contributed to voluntary pension funds is deductible from taxable income according to actual amounts incurred but must not exceed one (01) million VND per month (12 million VND per year) for employees participating in voluntary pension products as guided by the Ministry of Finance, even when participating in multiple funds. The basis for determining deductible income is a copy of the money payment certificate (or fee submission) issued by the voluntary pension fund.

Example 11: Mr. Y contributes to the Voluntary Pension Fund through contracting insurance with insurers or enterprises approved to provide voluntary pension products. If these voluntary pension products comply with the regulations of the Ministry of Finance and are approved for implementation, Mr. Y will be able to deduct from his taxable income as follows:

- Assuming the employee contributes 800,000 VND per month to the voluntary pension fund, corresponding to 9,600,000 VND per year, the deductible amount from taxable income is 9,600,000 VND per year.

- Assuming the contribution to the voluntary pension fund is 2,000,000 VND per month, corresponding to 24,000,000 VND per year, the deductible amount is 12,000,000 VND per year.

c) Foreigners residing in Vietnam and Vietnamese residing and working abroad who contribute to compulsory insurance as per the regulations of their country of residence or similar to Vietnamese law, such as social insurance, health insurance, unemployment insurance, compulsory professional liability insurance, and other compulsory insurances (if any), can deduct these insurance fees from taxable income from business, salary, and wages when calculating personal income tax.

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Thus, according to the above regulation, health insurance is deductible when calculating PIT.

Is health insurance deductible when calculating personal income tax in Vietnam? (Image from the Internet)

When shall overpaid tax not be refunded in Vietnam?

As stipulated in Clause 3, Article 60 of the Law on Tax Administration 2019, regulations on excess paid PIT not refundable and the tax authority settling excess payment in accounting records and electronic data systems in the following cases:

- The tax authority has notified the taxpayer about the excess paid tax refundable, but the taxpayer refuses to reclaim the excess payment in writing.

- The taxpayer is not operating at the registered address with the tax authority, and the tax authority has announced the excess payment in the public media, but after one year from the announcement date, the taxpayer has not responded in writing to request a tax refund from the tax authority.

- The excess payment exceeds the 10-year period from the date of payment into the state budget, where the taxpayer neither offsets tax obligations nor requests a tax refund.

Where is the location for submitting PIT declaration dossiers in Vietnam?

According to Article 45 of the Law on Tax Administration 2019, specific regulations on locations for submitting tax declaration dossiers are as follows:

- Taxpayers submit tax declaration dossiers to the directly managing tax authority.

- In case of submitting tax declaration dossiers via a single-window interlink mechanism, the location for submission is in accordance with the regulations of that mechanism.

- The location for submitting tax declaration dossiers for exported and imported goods is prescribed by the Law on Customs.

- The Government of Vietnam prescribes the location for submitting tax declaration dossiers in the following cases:

+ Taxpayers with multiple production or business activities;

+ Taxpayers conducting business in multiple locations; taxpayers incurring tax obligations on taxes declared and paid per occurrence;

+ Taxpayers incurring tax obligations from land-related revenues; granting rights for exploitation of water resources and mineral resources;

+ Taxpayers incurring tax obligations for finalization of personal income tax;

+ Taxpayers submitting tax declarations via electronic transactions and other necessary cases.