What is the purpose of registration of TINs for dependents in Vietnam?

What is the purpose of registration of TINs for dependents in Vietnam?

Under Clause 3, Article 30 of the Law on Tax Administration 2019:

Applying for taxpayer registration and TIN issuance

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3. Issuance of TINs:

a) Each enterprise, business organization or other organization is issued with 01 unique TIN to use throughout its entire operation, from the date of taxpayer registration to the date of TIN deactivation. A taxpayer’s branches, representative offices and/or dependent units that pay their own tax shall be issued with separate TINs. In case an enterprise, organization, branch, representative office or dependent unit combines taxpayer registration via the interlinked single-window system with business registration, the number of the certificate of enterprise registration, cooperative registration and/or business registration (hereinafter referred to as “business registration certificate”) is also the TIN; 

b) Each individual is issued 01 unique TIN to use throughout their whole life. Any dependant of that individual shall be issued with a TIN for the purpose of claiming personal exemption for personal income taxpayers. The TIN issued to the dependant is also his/her personal TIN, which is used when paying his/her tax;

c) Enterprises, organizations and individuals responsible for deducting and paying tax on behalf of taxpayers shall be issued with separate TINs for use when deducting tax;

d) Issued TINs shall not be reissued to another taxpayer;

dd) TINs of enterprises, business organizations and other organizations shall remain unchanged after they are converted, sold, gifted or inherited;

e) TIN issued to a household, household business or individual business is issued to the individual representing the household, household business or individual business

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Registration of TINs for dependents is to serve the personal deduction.

The TINs issued to dependents are also the individual's TIN when the dependent incurs obligations to the state budget.

What is the purpose of registration of TINs for dependents in Vietnam? (Image from the Internet)

Who do dependents registered for personal deduction when PIT calculation in Vietnam include?

Pursuant to Article 9 of the Circular 111/2013/TT-BTC, employees are allowed to apply for personal deduction for the following dependents:

- Children, legitimate adopted children, illegitimate children, stepchildren. To be specific:

+ Children under 18 years of age.

+ Children from 18 years of age and over that are disabled and incapable of work.

+ Children studying in Vietnam or overseas in universities, college, vocational schools, including children from 18 years of age and over in high schools (including the period awaiting university enrolment result from June to September in 12th grade) that have no income or have the average monthly income of ≤ 1.000.000 VND in the year from all sources.

- The taxpayer's spouse that meets the conditions in Point dd Clause 1 of Article 9 of Circular 111/2013/TT-BTC.

- The taxpayer’s parents, parents-in-law, stepparents, legitimate adoptive parents that meet the conditions in Point dd Clause 1 of Article 9 of Circular 111/2013/TT-BTC.

- Other dependants that the taxpayer has to provide for, who meet the conditions in Point dd Clause 1 of Article 9 of the Circular 111/2013/TT-BTC, including:

+ The taxpayer’s brothers and sisters.

+ The taxpayer’s grandparents, aunts, uncles.

+ The taxpayer’s nieces and nephews.

+ Other people to provide for as prescribed by law.

- A person that meets the conditions below shall be considered a dependant mentioned in Point d.2, d.3, d.4 Clause 1 of Article 9 of the Circular 111/2013/TT-BTC:

+ The person of working age must meet all conditions below:

++ The person is disabled and incapable of work.

++ The person has no income or his average monthly income from all sources does not exceed 1,000,000 VND.

+ The people outside working age shall have no income or their average monthly income from all sources shall not exceed 1,000,000 VND.

What is the current deduction for each dependent upon personal deduction in Vietnam?

Pursuant to Article 1 of Resolution 954/2020/UBTVQH14:

Deductions

Adjust the Deductions stipulated in Clause 1, Article 19 of the Personal Income Tax Law No. 04/2007/QH12, as 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 dependent is 4.4 million VND/month.

The current deduction for each dependent is 4.4 million VND/month.