Expatriate tax ebook - Vietnam

Facts and figures

Pre arrival procedures
Employment visas
Tax year
Tax returns and compliance
Income tax rates
Sample income tax calculation

Pre arrival procedures
An expatriate who requires a work permit must apply for this before taking up employment in Vietnam.

Employment visas

Generally, all expatriates working in Vietnam must secure a work permit except those specifically exempted.

Recent regulations have removed the 3% limit on the number of foreign expatriate working for Vietnamese enterprises.

If the expatriate's spouse and dependents also relocate to work in Vietnam, they will also be required to obtain work permits.

Tax year
For the first year the tax year is the first 12 months from the date of first arrival in Vietnam. For following years, the tax year will be the calendar year, i.e. 1 January to 31 December.

Tax returns and compliance
For salaries and wages, the tax procedures must be performed by the employer or its authorised tax agent following the withholding method.

Residents with income from overseas must register, declare, pay and finalise their tax liability directly at the local tax office.

Generally, personal income tax is required to be declared and paid monthly by the employer or by the employee declaring directly with the tax office and finalized on an annual basis.

The monthly declaration dossier must be submitted not later than the 20^th day of the following month. The deadline for the submission of the annual tax finalization dossier is the 90^th day from the end of the calendar year.

In case of expiration of contract, the deadline for the submission of the tax finalization dossier is the 45^th day from the date of expiration.

In case of income subject to tax on each occasion the income arises, the tax must be paid not later than 10 days from the date the income arose.

Income tax rates
Tax residents

Personal and dependents deduction are available for residents.

Non-residents
Salaries and wages of non-residents shall be subject to tax at the rate of 20%.

Other types of income shall be subject to the following rates:

* 20% applies if the taxpayer has registered this option by the end of the previous year with the local tax office. The choice (tax on gain or sales proceeds) can be changed every year.

**0.1% applies if the taxpayer has not registered to pay tax in accordance with the rate at 20%.

***2% applies if the purchase price cannot be determined.

Sample income tax calculation

Information about Vietnam: