Is the total of sales subject to personal income tax in Vietnam?

Is the total of sales subject to personal income tax in Vietnam?

Pursuant to Clause 2, Article 10 of the Law on Personal Income Tax 2007, as amended by Clause 4, Article 2 of the Law Amending Tax Laws 2014, specific provisions regarding taxes for 💧individuals doing business are as follows:

Tax on Individuals Doing Business

1. Individuals doing business shall pay personal income tax based on the turnover rate for each field, industry of production, and business.

2. Turnover comprises the total of sales, processing fees, commissions, and service provisions incurred during the tax calculation period from business activities, production of goods, and provision of services.

In the event that an individual doing business cannot determine their turnover, the tax authority with appropriate jurisdiction shall determine turnover as regulated by the law on tax ad💝ministration.

3. Tax rates:

a) Distribution, supply of goods: 0.5%;

b) Services, construꦉction without including material costs: 2%.

Particularly for activities such as asset lꩲeasing, insurance agency, lottery agency, and multi-lev🎐el sales agency: 5%;

c) Manufacturing, transportation, services associ🦩ated with good🤡s, construction that includes material costs: 1.5%;

d) Other business activities: 1%.

Thus, according to the above regulation, ꦚtotal of sales is subject to person𒐪al income tax.

What are regulations on personal income tax calculation period in Vietnam?

Based on Article 7 of the Law on Personal Income Tax 2007, as amended by Clause 3, Article 1 of the Amended Law on Personal Income Tax 2012, specific regulations on tax perio🧸ds are as follows:

[1] The tax calculation period for residen﷽🗹t individuals is regulated as follows:

- Annual tax calculation period applies to income from busine♈ss activities; income from wages and salaries;

- Tax calculation period based on each time income arises applies to income from capital investment; income from capital transfers, except income from securities transfers; income from real estate tra♛nsfers; income from winnings; income from copyright; income from franchising;🌌 income from inheritance; income from gifts;

- Tax calculation period based on each securities transfer or annually applies to income from securities▨ transfers.

[2] The tax calculation period for non-resident individuals is calculated for e🍷ach time income arises from all taxable income.

What Income is exempt from personal income tax in Vietnam?

According to Article 4 of the Law on Personal Income Tax 2007, supplemented by Clause 3, Article 2 of the Law Amending Tax Laws 2014 and amended by Clause 2, Article 1 of the Amended Law on Personal Income Tax 2012, the ജexempt income from ꦉpersonal income tax includes:

- Income from real estate transfers be🧸tween spouses; biologicꦗal parents and children; adoptive parents and adopted children; parents-in-law and daughters-in-law; parents-in-law and sons-in-law; grandparents and grandchildren; siblings.

- Income from the transfer of residential housing, residential land use rights, and assets attached to residential land of 🌳individuals who possess ✱only one house or residential land.

- Inco📖me from the value of land use rights allocated by the State.

- Income from inheritance, gifts that are real estate, between spouses🅺; biological parents and children; adoptive parents and adopted children; parents-in-law and daughters-in-law; parents-in-law and sons-in-law; grandparents and grandchildren; siblings.

- Income of households and individuals directly producing agriculture, forestr𓂃y, salt making, aquaculture, and fisheries not yet processed into other products or only through preliminary processing.

- Income from the conversion of agricultural land by households and individuals 🥂grꦰanted by the State for production.

- Income from interest on deposits at credit in⭕stitutions, interest from life insurance contracts.

- Income from remittances.

- Wag🧔es paid for night shifts, overtime, paid higher than day shifts, and work time as prescribed by law.

- Retirement pensions paid by the Social Insurance Fund; voluntary pension paid mo꧑n🍨thly.

- Income from scholarships, including:

+ Scholarships from the state budget;

+ Scholarships from domestic and foreign organizations under training sup🌌port programꦦs.

- Income from compensation from life and non-life insurance contracts, work accident compensation, state compensation, and otherꦍ compensations as prescribed by law.

- Income received from charitable funds established or recognized by state agencies with authority, operating for charitable, humanitarian pu꧃rposes, not for profit.

- Income received from foreign aid for charitable, humanitar♓ian purposes in government and non-government forms approved by competent state agencies.

- Income from wages and salaries of Vietnamese crew me⛄mbers working for foreign ships or Vietnamese ships engaged in international transport.

- Income of individuals who are ship owners, individuals with ship use rights, and individuals workin💖g on ships from🅰 activities directly providing goods and services for offshore fishing, exploitation activities.