What allowances, benefits, rewards are not subject to PIT in Vietnam?

Currently, what allowances, benefits, rewards are not subject to PIT in Vietnam? - Van Linh (Thai Nguyen, Vietnam)

What allowances, benefits, rewards are not subject to PIT in Vietnam? (Source: Internet)

1. Allowances and benefits without PIT in Vietnam

According to Point b, Clause 2, Article 2 of Circular 111/2013/TT-BTC (amended by Clause 1, Article 11 of Circular 92/2015/TT-BTC), the following allowances and benefits are not subject to PIT, including including:

- Monthly benefits, lump-sum benefits and allowances according to regulations of law on incentives for contributors.

- Monthly allowances and lump-sump allowances for the persons that participate in the resistance movements, national defense, fulfillment of international tasks, and discharged volunteers.

- Benefits for national defense and security; subsidies for the armed forces.

- Benefits for dangerous or harmful works.

- Benefits for employees in disadvantaged areas.

- Irregular allowances for difficulties, occupational accident benefits, occupational illness benefits, lump-sum allowances for childbirth or adoption, maternity leave benefits, post-maternity recovery benefits, benefits for reduction in work ability, lump-sum pension, monthly widow’s pension, severance pay, redundancy pay, unemployment benefits, and other benefits according to the Labor Code and the Law on Social insurance.

- Benefits for beneficiaries of social security.

- Benefits for senior officers.

- Lump-sum benefits for the persons reassigned to the areas facing extreme economic and social difficulties, lump-sum supports for officers working for sovereignty over sea and islands as prescribed by law. Lump-sum moving allowances for foreigners that move and reside in Vietnam and Vietnamese people that go to work abroad, and Vietnamese people that have long-term residence overseas then go back to work in Vietnam.

- Benefits for medical employees in villages.

- Occupational benefits.

2. Rewards not subject to PIT in Vietnam

Point e, Clause 2, Article 2 of Circular 111/2013/TT-BTC stipulating PIT calculation of bonuses in cash or non-cash in any form, including bonus in securities, except for the following bonuses:

- Prize money associated with the titles awarded by the State, including the prize money associated with honorary titles as prescribed by law:

+ Prize money associated with honorary titles awarded by Ministries, central and provincial agencies and associations, excellent employee titles.

+ Prize money associated with the awards.

+ Prize money associated with the titles awarded by the State.

+ Prize money associated with the awards presented by associations and organizations belonging to central and local political organizations, socio-political organizations, social organizations, social organizations that conforms with there charters and the Law on Emulation and commendation.

+ Prize money associated with the Ho Chi Minh Prize and National Prize.

+ Prize money associated with medals or badges.

+ Prize money associated with certificates of merit

- Prize money associated with national prizes and international prizes recognized by Vietnam.

- Rewards for technical innovations and inventions recognized by competent authorities.

- Rewards for reporting violations of law to competent authorities.

3. Other income not subject to PIT in Vietnam

Other income that are not subject to PIT specified at Point g, Clause 2, Article 2 of Circular 111/2013/TT-BTC (added by Clause 5, Article 11 of Circular 92/2015/TT-BTC), including:

- Supports provided by the employer for medical examination and treatment of fatal diseases suffered by employees and their families.

- The amount received according to regulations on using vehicles of state agencies, public service agencies, communist party’s organizations, and associations.

- The amount received according to the regulations on public housing.

- Other payments received, apart from wages, for participation in consultation, appraisal, and inspection of legislative documents, Resolutions, political reports, inspectorates, serving votes, citizens; for costumes and other tasks directly serving the operation of the Office of the National Assembly, the Ethnic Communities Council, committees of the National Assembly, the delegations of the National Assembly, the Central Office, the departments of the Communist Party, City/Province Committees and their departments.

- Payment for mid-shift meals, lunch of employees provided by employers that provide mid-shift meals, lunch for their employees in the form of cooking, buying catering services, giving luncheon vouchers.

If the employer pays cash for their employees’ meals instead of providing mid-shift meals or lunch, such money is not included in the taxable income if it is conformable with the guidance of the Ministry of Labor, War Invalids and Social Affairs. 

- The payment for round-trip air tickets made by the employer for foreign employees in Vietnam or Vietnamese employees overseas to go home once a year.

- The tuition fees for children of foreign employees in Vietnam to study in Vietnam, for children of Vietnamese employees overseas to study overseas from preschool to high school, which is paid by the employer on their behalf.

- The amounts received from sponsors are not included in the taxable income if the sponsorship beneficiary is a member of the sponsoring organization; the sponsorship is funded by government budget or managed in accordance with regulations of the State; from composting literary and artistic works, scientific research, accomplishment of political objectives of the State, or other activities that conforms with their charters.

- The payments paid by the employer for dispatching, reassigning foreign employees in Vietnam in accordance with labor contracts and international work schedules of some industries such as petroleum, mineral extraction.

- The amounts given by the income payer for employees’ family affairs shall comply with rules and regulations of the income payer and the guidance on determination of income subject to corporate income tax of instructional documents of the Law on Corporate income tax.

Nhu Mai


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