What are some points to note when registering for personal exemption in Vietnam in 2025?

What are some points to note when registering for personal exemption in Vietnam in 2025?

Based on sub-section 3, Section IV of Official Dispatch 154/CTSTR-KK 2025 from the Soc Trang Provincial Tax Department Download which provides guidance on some points to note when registering for personal exemption as follows:

- In cases where resident individuals have not yet calculated personal exemptions for themselves, or have not calculated it for the full 12 months within the tax assessment period, they shall be entitled to a full 12-month calculation if they settle taxes according to the regulations.

- To be eligible for deductions for dependants, the taxpayer must register for deductions for dependants in accordance with the regulations. If the taxpayer has not calculated personal exemptions for dependants in the tax year, they will be eligible for deductions from the month the nurturing obligation arises, when the taxpayer completes settlement and registers the deduction for dependants.

- For taxpayers authorized to settle taxes who have not yet calculated deductions for dependants in the tax year, they also may calculate deductions from the month the nurturing obligation arises, provided the taxpayer completes authorized settlement and registers the deduction through the income-paying organization.

- Each dependant can only be deducted once for one taxpayer in the tax year. If multiple taxpayers support a common dependant, they must mutually agree to register the deduction for one taxpayer.

- Employees working at a subsidiary, business location, or receiving income from wages from a head office in another province may register deductions for dependants at the tax authority managing the head office or the subsidiary, business location. If employees register deductions for dependants at a subsidiary, business location, the subsidiary, or business location is responsible for forwarding the proof of dependency documentation to the head office. The head office is accountable for reviewing, storing the proof documents as required, and presenting them during tax audits and inspections.

- In cases where an individual changes workplaces, they must register and submit proof of dependency documentation as instructed in sub-point h.2.1.1.1, point h, clause 1, Article 9 of Circular 111/2013/TT-BTC dated August 15, 2013, by the Minister of Finance.

- For dependants that fall under the categories defined in sub-sections d.2, d.3, d.4, point d, clause 1, Article 9 of Circular 111/2013/TT-BTC dated August 15, 2013, it's necessary to reference the labor age criteria regulated by the current Labor Code when submitting documentation for dependant deductions. For other dependants as guided in sub-section d.4, point d, clause 1, Article 9 of the Circular 111/2013/TT-BTC, proceed according to guidance in Official Dispatch No. 1351/CTSTR-KK dated November 19, 2024, by the Soc Trang Provincial Tax Department.

What are some points to note when registering for personal exemption in Vietnam in 2025? (Image from the Internet)

What is the current personal exemption rate in Vietnam?

Based on Article 1 of Resolution 954/2020/UBTVQH14 stipulating the personal exemption level as follows:

personal exemption Level

Adjust the personal exemption level stipulated in clause 1, Article 19 of the Law on Personal Income Tax No. 04/2007/QH12, amended and supplemented by Law No. 26/2012/QH13 as follows:

1. The deduction level for taxpayers is 11 million VND/month (132 million VND/year);

2. The deduction level for each dependant is 4.4 million VND/month.

The current personal exemption for taxpayers is 11 million VND/month (132 million VND/year) and for each dependant is 4.4 million VND/month.

What is the principle of personal exemption for dependants in Vietnam?

The principle for calculating personal exemptions for taxpayers is determined according to sub-section c.2, point c, clause 1, Article 9 of Circular 111/2013/TT-BTC (Relevant contents regarding personal income tax for individuals doing business in this Article are abolished by clause 6, Article 25 of Circular 92/2015/TT-BTC) as follows:

- Taxpayers are entitled to personal exemptions for dependants if the taxpayer has been registered and issued a tax code.

- When a taxpayer registers for personal exemptions for dependants, the tax authority will issue a tax code for the dependants, and temporary deductions may be calculated in the year from the time of registration. For dependants registered for deductions before October 1, 2013, they will continue to receive deductions until a tax code is issued.

- If the taxpayer has not calculated personal exemptions for dependants during the tax year, deductions may be calculated from the month the nurturing obligation arises when the taxpayer completes tax settlement and registers for deductions for dependants.

For other dependants following the guidance in sub-point d.4, point d, clause 1, Article 9 of Circular 111/2013/TT-BTC, the deadline for registering deductions is December 31 of the tax year; beyond this date, deductions will not be applicable for that tax year.

- Each dependant can only have the deduction applied once to one taxpayer in the tax year. In cases where multiple taxpayers share a common dependant, they must mutually agree to register the deduction to one taxpayer.