Vietnam: What is Sub-entry 1001?

Vietnam: What is Sub-entry 1001?

According to point b, clause 1, Article 4 of Circular 324/2016/TT-BTC, a Sub-entry (also known as an Economic Content Code - NDKT) is a detailed classification of Items, used to classify state budget revenue and expenditure in detail according to management objects within each Item.

Based on Appendix 3, the list of Sub-entries issued together with Circular 324/2016/TT-BTC, supplemented by Clause 5, Article 1 of Circular 93/2019/TT-BTC, which stipulates personal income tax Sub-entry 2024, Sub-entry 1001 is defined as follows:

Sub-entry 1001 is personal income tax from salary and wages.

Vietnam: What is Sub-entry 1001? (Image from the Internet)

Who are personal income taxpayers in Vietnam?

According to Article 2 of the Personal Income Tax Law 2007, taxpayers include:

- Taxpayers are resident individuals with taxable income specified in Article 3 of the Personal Income Tax Law 2007, which arises both inside and outside the territory of Vietnam, and non-resident individuals with taxable income specified in Article 3 of the Personal Income Tax Law 2007, which arises within the territory of Vietnam.

- A resident individual is someone who meets one of the following conditions:

+ Being present in Vietnam for 183 days or more within a calendar year or 12 consecutive months from the first day of arrival in Vietnam;

+ Having a regular place of residence in Vietnam, including having a registered permanent residence or a rented house to stay in Vietnam per a rental contract.

- A non-resident individual is someone who does not meet the conditions specified in clause 2, Article 2 of the Personal Income Tax Law 2007.

What types of income are subject to personal income tax in Vietnam?

According to Article 3 of the Personal Income Tax Law 2007, amended by clause 2, Article 2 of the Law Amending Tax Laws 2014, clause 1, Article 1 of the Amended Personal Income Tax Law 2012, taxable personal income includes the following types of income, except for tax-exempt income specified in Article 4 of the Personal Income Tax Law 2007:

(1) Income from business, including:

- Income from the production and business of goods and services;

- Income from independent professional activities of individuals with licenses or practicing certificates as prescribed by law.

Business income specified in this clause does not include the income of individuals with business revenue of 100 million VND/year or less.

(2) Income from salary, wages, including:

- Salary, wages, and amounts of similar nature;

- Allowances and subsidies, excluding:

Allowances and subsidies as prescribed by law on preferential treatment for people with meritorious services; defense and security allowances; hazard and danger allowances for occupations or jobs performed at places with hazardous and dangerous elements; attraction allowances, regional allowances as prescribed by law; unexpected difficulty allowances, labor accident allowances, occupational disease allowances, lump-sum maternity or adoption allowances, incapacity allowances, pension allowances, monthly pension, and other subsidies as prescribed by social insurance law; severance and job-loss allowances as prescribed by the Labor Code 2019; social protection allowances and other allowances and subsidies of similar nature as prescribed by the Government of Vietnam.

(3) Income from capital investment, including:

- Loan interest;

- Dividend;

- Income from other forms of capital investment, excluding Government of Vietnam bond interest income.

(4) Income from the transfer of capital, including:

- Income from the transfer of capital in economic organizations;

- Income from the transfer of securities;

- Income from other forms of capital transfer.

(5) Income from the transfer of real estate, including:

- Income from the transfer of land use rights and assets attached to the land;

- Income from the transfer of ownership or use rights of houses;

- Income from the transfer of land lease rights, water surface lease rights;

- Other income obtained from the transfer of real estate in any form.

(6) Income from winnings, including:

- Lottery winnings;

- Promotional winnings;

- Betting winnings;

- Winnings from games, contests, and other forms of winnings.

(7) Income from royalties, including:

- Income from the transfer and granting of the right to use objects of intellectual property rights;

- Income from technology transfer.

(8) Income from franchising.

(9) Income from inheritance, including securities, capital portions in economic organizations, business establishments, real estate, and other assets requiring registration of ownership or use rights.

(10) Income from gifts, including securities, capital portions in economic organizations, business establishments, real estate, and other assets requiring registration of ownership or use rights.