If I inherit capital contribution of a limited liability company from my husband, will I be exempt from personal income tax in Vietnam?

If I inherit capital contribution of a limited liability company from my husband, will I be exempt from personal income tax in Vietnam?

Pursuant to Clause 4, Article 4 of the 2007 Personal Income Tax Law, it is stipulated that tax-exempt incomes is as follows:

4. Incomes from receipt of inheritances or gifts that are real estate between spouses, parents and their children; adoptive parents and their adopted children; fathers-in-law or mothers-in-law and daughters-in-law or sons-in-law; grandparents and their grandchildren; or among blood siblings.

In addition, Clause 9, Article 2, Circular 111/2013/TT-BTC stipulates taxable amounts as follows:

9. Incomes from inheritance

Incomes from inheritance are the incomes the person receives under a will or in accordance with regulations of law on inheritance. To be specific:

a) Inherited securities: shares, call options on shares, bonds, treasury bills, fund certificates, and other securities according to the Law on Securities; shares of the person in the joint-stock company according to the Law on Enterprises.

b) Inherited capital in economic organizations and businesses: capital contribution to limited liability companies, cooperatives, partnerships, business cooperation contracts; capital in private enterprises and businesses of the person; capital in associations and funds established within the law, or the entire business if the private enterprise or business is under the ownership of the person.

c) Inherited real estate: rights to use land, rights to use land and property thereon; ownership of houses, including future houses, infrastructure and constructions on land, including off-the-plan constructions; rights to rent land or water surface; other incomes from inheritance being real estate in any shape or form, except for incomes from the inherited real estate mentioned in Point d Clause 1 Article 3 of this Circular.

d) The ownership and use rights of other inherited assets (cars, motorbikes, ships, barges, speedboats, towboats, yachts, airplanes, hunting guns, sporting guns) must be registered with state agencies.

According to current regulations in Vietnam, your income is not exempt from personal income tax but is subject to personal income tax.

If I inherit capital contribution of a limited liability company from my husband, will I be exempt from personal income tax in Vietnam? (Image from the Internet)

What is calculation of tax period from inheritance in Vietnam?

Pursuant to Article 7 of the 2007 Personal Income Tax Law amended by Clause 3, Article 1 of the Personal Income Tax Law amended 2012, the tax period is as follows:

1. For residents, tax period is specified as follows:

a/ Annual tax period, which is applicable to incomes from business, salaries and wages.

b/ Tax period upon each time of income generation, which is applicable to incomes from capital investment; incomes from capital transfer, except for incomes from securities transfer; incomes from real estate transfer; incomes from prizes; incomes from copyright; incomes from commercial franchising; incomes from inheritances; and gifts.

c. Tax period upon each transfer or annual tax period, which is applicable to Incomes from transfer of securities.

2. For non-residents, the tax period counted upon each time of income generation is applicable to all their taxable incomes.

Thus, the income tax period for individuals on income from inheritance will be calculated for each time the income is generated in Vietnam.

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