Chapter II
TAX BASES FOR RESIDENTS
Section 1. DETERMINATION OF TAXABLE INCOMES AND TAXED INCOMES
Article 10. Taxable incomes from business
1. A taxable income from business is determined to be equal to turnover minus reasonable expenses related to the generation of the taxable income from business in a tax period.
2. Turnover means the total of sales, processing remuneration, commissions, goods or service provision charges generated in a tax period from goods production and trading or service provision.
The time of determination of turnover is the time of transfer of ownership of goods or completion of services or the time of making goods sale or service provision invoices.
3. Reasonable expenses related to the generation of taxable incomes from business in a tax period include:
a/ Salaries, wages, remuneration and other payments to laborers;
b/ Expenses for raw materials, fuels, materials, energy and goods used for production or business, charges for services purchased from outside;
c/ Expenses for depreciation, regular repair and maintenance of fixed assets used for production or business;
d/ Paid interests;
e/ Management expenses;
f/ Taxes, charges and fees payable under law and allowed to be accounted as expenses;
g/ Other expenses related to the generation of incomes.
4. The determination of turnover and expenses is based on accounting norms, standards, regulations, documents and books prescribed by law.
5. If many persons jointly conduct business activities under the same business registration, taxable income of each of them is determined according to one of the following principles:
a/ In proportion to their capital contributions stated in the business registration;
b/ Under their agreement stated in the business registration;
c/ According to the average per-capita income in case the business registration neither states their capital contributions nor contains any agreement on income division among them.
6. For business individuals who fail to strictly comply with regulations on accounting, invoices and documents and cannot measure turnover, expenses and taxable income, competent tax offices shall predetermine turnover and the ratio of taxable income in order to determine taxable income suitable to each industry or business line under the law on tax administration.
Article 11. Taxable incomes from salaries or wages
1. A taxable income from salary or wage is determined to be equal to the total of incomes specified in Clause 2, Article 3 of this Law and earned by a taxpayer in a tax period.
2. Time of determination of a taxable income from salary or wage is the time when an organization or individual pays income to a taxpayer or when a taxpayer receives income.
Article 12. Taxable incomes from capital investment
1. A taxable income from capital investment is the total of incomes from capital investment specified in Clause 3, Article 3 of this Law and earned by a taxpayer in a tax period.
2. Time of determination of a taxable income from capital investment is the time when an organization or individual pays income to a taxpayer or when a taxpayer receives income.
Article 13. Taxable incomes from capital transfer
1. A taxable income from capital transfer is determined to be equal to the selling price minus the buying price and reasonable expenses related to the generation of income from capital transfer.
2. If the buying price and expenses related to the securities transfer are unidentifiable, taxable income is determined to be the selling price of securities.
3. Time of determination of a taxable income from capital transfer is the time when the capital transfer transaction is completed in accordance with law.
The Government shall detail and guide the implementation of this Article.
Article 14. Taxable incomes from real estate transfer
1. A taxable income from real estate transfer is determined to be equal to the real estate transfer price upon the transfer minus the real estate buying price and related expenses, specifically as follows:
a/ Real estate transfer price is the contractual price at the time of transfer;
b/ Real estate buying price is the contractual price at the time of purchase;
c/ Related expenses to be subtracted are those recorded in vouchers and invoices lawfully, including charges and fees related to land use rights as prescribed by law; expenses for land revamp, house renovation, ground leveling; expenses for investment in building residential houses, infrastructures and architectures on land; and other expenses related to the real estate transfer.
2. If the buying price and expenses related to the transfer of a real estate are unidentifiable, the taxable income is determined to be the real estate transfer price.
3. The Government shall stipulate principles and methods of determination of real estate transfer prices in case transfer prices are unidentifiable or land use rights transfer prices stated in contracts are lower than land prices promulgated by provincial-level People’s Committees and effective at the time of transfer.
4. Time of determination of a taxable income from real estate transfer is the time when the transfer contract becomes effective in accordance with law.
Article 15. Taxable incomes from won prizes
1. A taxable income from won prize is the prize value in excess of VND 10 million received by a taxpayer upon each time of winning.
2. Time of determination of a taxable income from won prize is the time when an organization or individual pays income to a taxpayer.
Article 16. Taxable incomes from copyright
1. A taxable income from copyright is an income in excess of VND 10 million earned by a taxpayer when assigning or licensing an intellectual property object or transferring a technology under a contract.
2. Time of determination of a taxable income from copyright is the time when an organization or individual pays income to a taxpayer.
Article 17. Taxable incomes from commercial franchising
1. A taxable income from commercial franchising is an income in excess of VND 10 million earned by a taxpayer under a commercial franchising contract.
2. Time of determination of a taxable from commercial franchising is the time when an organization or individual pays income to a taxpayer.
Article 18. Taxable incomes from inheritances or gifts
1. A taxable income from inheritance or gift is the value of an inherited asset or a gift in excess of VND 10 million received by a taxpayer upon each time of inheritance or gift receipt.
2. Time of determination of a taxable income is specified as follows:
a/ For an income from inheritance, it is the time when a taxpayer receives an inherited estate;
b/ For an income from gift, it is the time when an organization or individual presents a gift to a taxpayer or when a taxpayer receives the income.
Article 19. Reduction based on family circumstances
1. Reduction based on family circumstances means a sum of money deductible from pre-tax income from business, salary or wage of a resident taxpayer. Reduction based on family circumstances consists of the following two parts:
a/ Reduction for the taxpayer, which is VND 4 million/month (VND 48 million/year);
b/ Reduction for each dependant of the taxpayer, which is VND 1.6 million/month.
2. The level of reduction based on family circumstances applicable to dependants is determined on the principle that each dependant may be counted only once for tax reduction for a taxpayer.
3. Dependants of a taxpayer means persons a taxpayer is responsible for nurturing or taking care of, including:
a/ His/her minor children or disabled children who are incapable of working;
b/ Individuals who have no income or have incomes not exceeding the prescribed level, including adult children who are studying at a university, college, professional secondary school or job-training establishment; his/her spouse who is incapable of working; his/her parents who are beyond the working age or incapable of working; other supportless persons whom the taxpayer has to directly nurture.
The Government shall specify the income level and declaration for identification of dependants to be counted for reduction based on family circumstances.
Article 20. Reduction for charity or humanitarian donations
1. Charity or humanitarian donations are deductible from pre-tax income from business, salary or wage of a resident taxpayer, including:
a/ Donations to organizations or establishments that care for or nurture children in special plights, disabled people and supportless elderly people.
b/ Donations to charity funds, humanitarian funds or study promotion funds.
2. Organizations, establishments and funds specified at Points a and b, Clause 1 of this Article must be those licensed or recognized by competent state agencies and operating for charity, humanitarian, study promotion or non-profit purposes.
Article 21. Taxed incomes
1. A taxed income from business, salary or wage is the total of taxable incomes specified in Articles 10 and 11 of this Law minus premiums of social insurance, health insurance and professional liability insurance for some professions and jobs subject to compulsory insurance and reductions specified in Articles 19 and 20 of this Law.
2. Taxed incomes from capital investment, capital transfer, real estate transfer, won prizes, copyright royalties, commercial franchising, inheritances or gifts are taxable incomes specified in Articles 12, 13, 14, 15, 16, 17 and 18 of this Law.
Section 2. TARIFFS
Article 22. Partially progressive tariff
1. The partially progressive tariff applies to taxed incomes specified in Clause 1, Article 21 of this Law.
2. The partially progressive tariff is specified below:
|
Tax grade
|
Taxed income per year
(VND million)
|
Taxed income per month (VND million)
|
Tax rate (%)
|
|
1
|
Up to 60
|
Up to 5
|
5
|
|
2
|
Between over 60 and 120
|
Between over 5 and 10
|
10
|
|
3
|
Between over 120 and 216
|
Between over 10 and 18
|
15
|
|
4
|
Between over 216 and 384
|
Between over 18 and 32
|
20
|
|
5
|
Between over 384 and 624
|
Between over 32 and 52
|
25
|
|
6
|
Between over 624 and 960
|
Between over 52 and 80
|
30
|
|
7
|
Over 960
|
Over 80
|
35
|
Article 23. Whole income tariff
1. The whole income tariff applies to taxed incomes specified in Clause 2, Article 21 of this Law.
2. The whole income tariff is specified below:
|
Taxed incomes
|
Tax rate (%)
|
|
a/ Incomes from capital investment
|
5
|
|
b/ Incomes from copyright, commercial franchising
|
5
|
|
c/ Incomes from prizes
|
10
|
|
d/ Incomes from inheritances, gifts
|
10
|
|
e/ Incomes from capital transfer specified in Clause 1, Article 13 of this Law
|
20
|
|
Incomes from securities transfer specified in Clause 2, Article 13 of this Law
|
0.1
|
|
f/ Incomes from real estate transfer specified in Clause 1, Article 14 of this Law
|
25
|
|
Incomes from real estate transfer specified in Clause 2, Article 14 of this Law
|
2
|
Article 24. Responsibilities of income-paying organizations and individuals and responsibilities of resident taxpayers
1. Responsibility to make tax declaration, withholding, payment and finalization is specified as follows:
a/ Income-paying organizations and individuals shall make tax declaration, withhold and remit tax into the state budget, and make tax finalization for all kinds of taxable income they pay to taxpayers;
b/ Individuals who have taxable incomes shall make tax declaration, pay tax into the state budget and make tax finalization for all their incomes in accordance with the law on tax administration.
2. Income-paying organizations and individuals shall supply information on incomes and dependants of taxpayers under their management in accordance with law.
3. The Government shall specify tax withholding rates suitable to each kind of income specified at Point a, Clause 1 of this Article.
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Luật Thuế thu nhập cá nhân 2007 (Bản Word)