Latest Dependent Deduction Levels for Personal Income Tax: Who are Considered Dependents under the Latest Regulations?
Latest Dependent Personal Exemption Amounts?
Based on Article 1 of Resolution 954/2020/UBTVQH14, the dependent personal exemption amounts are stipulated as follows:
Dependent Personal Exemption Amount
Adjustment to the personal exemption amount stipulated in Clause 1, Article 19 of the Personal Income Tax Law No. 04/2007/QH12, which has been amended and supplemented by Law No. 26/2012/QH13, as follows:
1. The exemption amount for taxpayers is VND 11 million/month (VND 132 million/year);
2. The exemption amount for each dependent is VND 4.4 million/month.
The exemption amount for taxpayers is VND 11 million/month (VND 132 million/year) and the exemption amount for each dependent is VND 4.4 million/month.
Latest personal exemption amounts for dependents? Who are considered dependents under the latest regulations?
Who are considered dependents?
Based on Point d, Clause 1, Article 9 of Circular 111/2013/TT-BTC, dependents include the following individuals:
Children: Biological children, legally adopted children, illegitimate children, stepchildren.
- Children under 18 years old (calculated by month).
- Children from 18 years old and over with disabilities, incapable of working.
- Children studying in Vietnam or abroad at the university, college, vocational school level, including children from 18 years old and over still in high school (including the period waiting for university results from June to September of the 12th grade) with no income or an average monthly income from all sources not exceeding VND 1 million.
Spouse of the taxpayer.
- For individuals within the working age, they must concurrently meet the following conditions:
+ Disabled, incapable of working.
+ No income or an average monthly income from all sources not exceeding VND 1 million.
- For individuals outside the working age, they must have no income or an average monthly income from all sources not exceeding VND 1 million.
Biological parents, parents-in-law (or parents of the spouse), stepparents, legally adoptive parents.
- For individuals within the working age, they must concurrently meet the following conditions:
+ Disabled, incapable of working.
+ No income or an average monthly income from all sources not exceeding VND 1 million.
- For individuals outside the working age, they must have no income or an average monthly income from all sources not exceeding VND 1 million.
Other individuals include:
- Siblings of the taxpayer.
- Grandparents; uncles or aunts of the taxpayer.
- Nephews/nieces of the taxpayer including: children of siblings.
- Other dependents as per law regulations.
How many dependents can a taxpayer claim for personal exemption?
Based on Point c, Clause 1, Article 9 of Circular 111/2013/TT-BTC, it stipulates:
Exemption Categories
1. Personal exemptions
...
c) Principles for claiming personal exemptions
c.2) Exemption for dependents
c.2.1) The taxpayer is eligible to claim an exemption for dependents if they have registered the taxpayer and been granted a tax identification number.
c.2.2) Upon registration for exemptions for dependents, the tax office will grant a tax identification number for the dependents and temporarily calculate the personal exemption in the year of registration. For dependents registered prior to the effective date of this Circular, the personal exemption continues until they receive a tax identification number.
c.2.3) If the taxpayer has not claimed an exemption for dependents during the tax year, they may claim it from the month when the obligation arises when filing the final tax return and registering the exemption for dependents. For other dependents per the guidance in Subsection d.4, Point d, Clause 1 of this Article, the latest deadline for registration is December 31 of the tax year. Missing this deadline will forfeit the right for that tax year.
c.2.4) Each dependent only qualifies for an exemption from one taxpayer in a tax year. If multiple taxpayers share dependents, they must agree on which taxpayer claims the exemption.
Each dependent may only qualify for an exemption from one taxpayer in a tax year.
If multiple taxpayers share dependents, they must agree on which taxpayer claims the exemption.
This regulation only addresses that each dependent can only be claimed as a personal exemption by one taxpayer. Therefore, a taxpayer may be eligible to claim personal exemptions for multiple dependents.
LawNet