Is the income of an individual being a ship owner subject to personal income tax in Vietnam?

Is the income of an individual being a ship owner subject to personal income tax in Vietnam?

According to Article 4 of the Law on Personal Income Tax 2007, supplemented by Clause 3, Article 2 of the Law amending and supplementing tax-related laws 2014, specifies the income exempt from personal income tax as follows:

Tax-Exempt Income

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15. Income from salaries and wages of Vietnamese crew members working for foreign shipping companies or Vietnamese companies engaged in international transport.

16. Income of individuals who are ship owners, individuals with the right to use ships, and individuals working on ships from activities providing goods and services directly serving offshore fishing and exploitation activities.

Thus, according to the above provisions, the income of an individual who is a ship owner is exempt from personal income tax.

Is the income of an individual being a ship owner subject to personal income tax in Vietnam? (Image from the Internet)

What income is exempt from personal income tax in Vietnam?

According to Article 4 of the Law on Personal Income Tax 2007, supplemented by Clause 3, Article 2 of the Law amending and supplementing tax-related laws 2014 and amended by Clause 2, Article 1 of the Amended Law on Personal Income Tax 2012, the following individual incomes are exempt from personal income tax:

- Income from real estate transfers between spouses; biological parents and children; adoptive parents and adopted children; parents-in-law and daughters-in-law; parents-in-law and sons-in-law; paternal grandparents and grandchildren; maternal grandparents and grandchildren; siblings.

- Income from the transfer of residential houses, rights to use homestead land, and assets attached to homestead land in cases where an individual has only one residential house or homestead land.

- Income from the value of land use rights allocated by the State to individuals.

- Income from inheritance or gifts as real estate transferred between spouses; biological parents and children; adoptive parents and adopted children; parents-in-law and daughters-in-law; parents-in-law and sons-in-law; paternal grandparents and grandchildren; maternal grandparents and grandchildren; siblings.

- Income of households and individuals directly engaged in agricultural, forestry production, salt making, aquaculture, fishing, not yet processed into other products or only by ordinary preliminary processing.

- Income from the conversion of agricultural land granted by the State for production for households and individuals.

- Income from interest on deposits at credit institutions, interest from life insurance contracts.

- Income from overseas remittances.

- The portion of night-shift or overtime salary paid higher than regular day-time or regular working hours as prescribed by law.

- Retirement pensions paid by the Social Insurance Fund; monthly pensions paid by voluntary pension funds.

- Income from scholarships, including:

+ Scholarships received from the state budget;

+ Scholarships received from domestic and foreign organizations under their programs supporting education incentives.

- Income from compensation for life and non-life insurance contracts, compensation for occupational accident, state compensation, and other compensation as prescribed by law.

- Income received from charity funds established or recognized by competent state agencies, operating for charitable, humanitarian purposes, not for profit.

- Income received from foreign aid for charitable, humanitarian purposes under the form of government and non-government organizations approved by competent state agencies.

- Income from salaries and wages of Vietnamese crew members working for foreign shipping companies or Vietnamese companies engaged in international transport.

- Income of individuals who are ship owners, individuals with the right to use ships, and individuals working on ships from activities providing goods and services directly serving offshore fishing and exploitation activities.

What is the personal income tax period in Vietnam?

According to Article 7 of the Law on Personal Income Tax 2007, amended by Clause 3, Article 1 of the Amended Law on Personal Income Tax 2012, the personal income tax period is defined as follows:

- The tax period for resident individuals is regulated as follows:

+ The annual tax period applies to income from business; income from salaries and wages;

+ The tax period per occurrence of income applies to income from capital investment; income from capital transfers, except for income from securities transfers; income from real estate transfers; income from winnings; income from royalties; income from franchising; income from inheritance; income from gifts;

+ The tax period per occurrence of transfers or annually applies to income from securities transfers.

- The tax period for non-resident individuals is calculated per occurrence of income, applicable to all taxable income.