Draft Resolution on Adjusting the Family Deduction Level of Personal Income Tax is currently open for public comments, expected to take effect from the date of signing.
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This Resolution adjusts the dependent deduction level specified in Clause 1, Article 19 of the Personal Income Tax Law (amended and supplemented by Clause 4, Article 1 of the Amended Personal Income Tax Law 2012) as follows:
a) The deduction level for taxpayers is VND 11 million/month (VND 132 million/year);
b) The deduction level for each dependent is VND 4.4 million/month.
Thus, it can be observed that if the contents of the Draft Resolution are approved, the dependent deduction level for personal income tax will significantly increase in the near future. Specifically, the deduction level for taxpayers will be VND 11 million/month (an increase of VND 2 million/month), and the deduction level for each dependent will be VND 4.4 million/month (an increase of VND 0.8 million/month).
Currently, according to the regulations in Clause 1, Article 19 of the Personal Income Tax Law (amended and supplemented by Clause 4, Article 1 of the Amended Personal Income Tax Law 2012), the dependent deduction level is VND 9 million/month (VND 108 million/year) for taxpayers and VND 3.6 million/month for each dependent.
This Resolution is effective from the date of signing and applies to the tax calculation period of 2020.
Cases that have temporarily paid tax according to the deduction level specified in Clause 4, Article 1 of the Amended Personal Income Tax Law 2012 (VND 9 million/month for taxpayers and VND 3.6 million/month for each dependent) will have their personal income tax payable determined based on the new deduction levels in this Resolution when finalizing personal income tax for 2020.
Note: Dependent deduction is the amount deducted from taxable income before calculating tax on income from business, salary, and wages of resident taxpayers. Dependent deduction includes two parts: the deduction for taxpayers and the deduction for each dependent.
See detailed content of the Draft Resolution HERE.
Nguyen Trinh
