Instructions for declaring personal income tax for foreigners in Vietnam
Personal income tax (PIT) declaration means a very important thing for both employees and employers, especially when foreign workers recruited and worked in Vietnam. How to declare personal income tax for foreigners? How is the personal income tax payable by these individuals determined? In this article, LSX legal firm will inform you: “Instructions for declaring personal income tax for foreigners in Vietnam”
Legal ground
- Circular 111/2013/TT-BTC
The types of Personal Income Tax (PIT) for foreigners?
9 types of taxable income:
- Firstly, personal income tax for foreigners from business.
- Secondly, personal income tax from wages and salaries paid by the employer.
- Thirdly, personal income tax for foreigners from capital investment.
- Fourthly, personal income tax for foreigners from capital transfer.
- Fifthly, personal income tax for foreigners from real estate transfer.
- Also, personal income tax for foreigners from winning prizes.
- Personal income tax for foreigners from copyright.
- Personal income tax for foreigners from inheritance.
- Lastly, personal income tax for foreigners from receiving gifts.
Tax declaration for organizations and individuals paying income and deducting tax
Monthly and quarterly tax declaration
Organizations and individuals paying incomes subject to personal income tax and making tax deductions take responsible for declaring taxes and submitting declarations to tax authorities monthly or quarterly, specifically as follows:
- In case of deducting personal income tax on incomes from salaries and wages: submit a declaration using form No. 02/KK-TNCN attached to Circular 111/2013/TT-BTC.
- Personal income tax deduction for income from capital investment, securities transfer, copyright, commercial franchise, prize winning for individuals, and payment of business income for non-resident individuals; submit the declaration form No. 03/KK-TNCN attached to Circular 111/2013/TT-BTC.
- In case the establishment assigns an insurance agent to withhold personal income tax on the income of the insurance agent; submit the declaration form No. 01/KK-BH attached to Circular 111/2013/TT-BTC.
- In case lottery business organizations withhold personal income tax on the income of lottery agents, they shall submit a declaration using form No. 01/KK-XS attached to Circular 111/2013/TT-BTC.
Dossiers of tax declaration
The tax declaration dossiers include a tax declaration form and related documents as a basis for taxpayers to declare and calculate tax with tax authorities.
Taxpayers must use the correct tax declaration form and the appendix forms attached to the tax return prescribed by the Ministry of Finance; must not change the format, add, remove or change the position of any items in the tax declaration form. For a number of papers in the tax dossier, which the Ministry of Finance has not issued, the form shall comply with relevant laws.
Deadline for submission of tax declaration
- Firstly, the deadline for submitting monthly tax declaration dossiers: the twentieth day of the month following the month in which the tax liability arises.
- Secondly, the deadline for submitting quarterly tax declaration dossiers: the thirtieth day of the quarter following the quarter in which the tax liability arises.
- Thirdly, the deadline for submitting tax returns for the whole year: the thirtieth day of the first month of the calendar year or fiscal year.
- Fourthly, the deadline for submitting a tax return for each time a tax liability arises: the tenth day from the date of arising of the tax obligation.
- Lastly, time limit for submitting tax and other revenue-related declaration dossiers related to land use under the one-stop-shop mechanism; shall comply with the time limit specified in the inter-branch guiding document on such one-stop-shop mechanism.
Where to file tax returns
For income-paying units as production and business organizations as well as individuals, submit tax declaration dossiers at tax agencies directly managing production and business organizations and individuals.
For other cases:
- Central agencies, agencies under ministries, branches, provincial-level People’s Committees, and provincial-level agencies shall submit tax declaration dossiers at the Tax Department where the agency’s head office is located.
- Agencies directly under the district-level People’s Committees, and district-level agencies shall submit tax declaration dossiers at the Sub-department of Taxation where the agency’s head office is located.
- Diplomatic agencies, international organizations, representative offices of foreign organizations, etc. shall submit tax declaration dossiers at the Tax Department where the agency’s head office is located.
Tax declaration for individuals with income from wages, salaries and non-residents with business income
Monthly tax declaration
Cases must declare monthly tax:
- Individuals earn incomes from salaries and wages paid by organizations and individuals from abroad.
- Individuals earn incomes from salaries and wages paid by international organizations, Embassies, and Consulates in Vietnam but have not yet deducted tax.
- Non-resident individuals with business income.
In case the income-paying agency has deducted tax and paid tax on behalf of the individual; the Individual is not required to declare and pay tax monthly.
Monthly tax return file
Personal income tax return, made according to form No. 07/KK-TNCN attached to Circular 111/2013/TT-BTC
Where to file monthly tax returns
For income from salary and wages: the Tax Department where the individual works.
For income from business: the Tax Department where the individual does business.
Legal service of LSX Legal Firm
LSX legal firm provides legal services to clients in various legal areas. To make your case convenient, LSX will perform:
- Legal advice related to new regulations in business suspension;
- Representing in drafting and editing documents;
- We commit the papers to be valid, and legal for use in all cases;
- Represent to submit documents, receive results, and hand them over to customers.
With a team of experienced, reputable, and professional consultants; The firm is always ready to support and work with clients to solve legal difficulties.
Furthermore, using our service, you do not need to do the paperwork yourself, We guarantee to help you prepare documents effectively and legally.
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Related articles
- Service of business suspension for foreign company in Vietnam
- Who must pay personal income tax in Vietnam 2022?
- How to look up personal tax code in Vietnam
Related questions
Tax on income from salary or wage of a non-resident is determined to be equal to his/her income from salary or wage specified in Clause 2 of this Article multiplied by the tax rate of 20%.
Firstly, personal income tax is a direct tax.
Personal income tax subjects to each individual’s income.
Thirdly, personal income tax usually applied according to the principle of a partial progressive tax rate.
Fourthly, the stability of PIT is not high and complicated.
Lastly, sources of law governing the PIT relationship include national and international legal documents.
Currently, there is no precise and specific definition of personal income tax (PIT). However, based on the provisions of the law recorded in the Law on Personal Income Tax, Decrees and Circulars guiding, you can understand the PIT as follows:
PIT – a tax that the state uses to regulate a part of an individual’s income into the state budget for the purpose of generating revenue for the state budget and implementing social justice. PIT is a direct tax; calculated on the income of the taxpayer after deducting tax-free income as well as deductions for family circumstances.
Contact LSX
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