Vietnam reformed its PIT structure in 2026 (Law 109/2025/QH15, effective January 1, 2026), simplifying from 7 brackets to 5 brackets (5%–35%). The 15% and 25% bands were eliminated and all thresholds were raised. The top rate of 35% now kicks in at VND 1,200 million/year (~$45,800 USD) — up from VND 960 million under the old law. The personal deduction also increased from VND 11M to VND 15.5M/month (VND 186M/year, per Resolution 110/2025/UBTVQH15), meaning a single person with no dependents pays no PIT until monthly income exceeds VND 15.5 million (~$592/month). Dependent deduction: VND 6.2M/month per registered dependent (up from VND 4.4M). Social insurance adds 10.5%: 8% BHXH pension, 1.5% BHYT health, 1% BHTN unemployment — all capped at VND 561.6M/year (20 × VND 2,340,000 base salary × 12). Foreign contractors can choose 5% withholding on gross revenue or register for regular progressive taxation. Vietnam has no capital gains tax on stocks (only 0.1% transaction tax on sale value). The 183-day rule determines tax residency. Non-residents pay a flat 20% on Vietnam-sourced employment income. Filing deadline: March 31 (last day of Q1 following the tax year).
Note: These are marginal rates — you only pay the higher rate on income within each bracket.
Source: General Department of Taxation
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Vietnam reformed its PIT from 7 to 5 brackets effective January 1, 2026 (Law 109/2025/QH15). The 2026 structure on annual taxable income: 5% on VND 0–120 million (0–10M/month), 10% on VND 120–360 million (10–30M/month), 20% on VND 360–720 million (30–60M/month), 30% on VND 720–1,200 million (60–100M/month), and 35% above VND 1,200 million (above 100M/month). The old 15% and 25% bands were eliminated and all thresholds were raised. The top 35% rate now starts at ~$45,800 USD, up from the old ~$38,000 under the 7-bracket structure. Taxable income is gross income minus the personal deduction (VND 15.5M/month) and any registered dependent deductions.
The main deduction is the personal family circumstance deduction, updated for 2026 (Resolution 110/2025/UBTVQH15): VND 15.5 million/month (VND 186 million/year) for the taxpayer themselves, up from VND 11M/month. Dependants: VND 6.2 million/month per registered dependent (up from VND 4.4M), requiring registration with tax authorities and supporting documents. A single person with no dependents pays no PIT on income up to VND 15.5M/month (~$592/month). Additional deductions: mandatory insurance contributions (BHXH, BHYT, BHTN — paid pre-tax), charitable donations to approved organisations, and voluntary pension fund contributions. No broad itemised deductions like Western systems.
Vietnamese employees pay 10.5% total social contributions: 8% BHXH social insurance (bảo hiểm xã hội, pension/sickness), 1.5% BHYT health insurance (bảo hiểm y tế), and 1% BHTN unemployment insurance (bảo hiểm thất nghiệp). All three are capped at 20× the reference base salary: VND 2,340,000/month × 20 = VND 46,800,000/month ceiling = VND 561,600,000/year (per Law on Social Insurance 41/2024/QH15, effective July 2025). Maximum annual employee social contribution: ~VND 58,968,000 (10.5% × 561.6M). Employers pay 21.5% (17.5% SI + 3% HI + 1% UI). Foreign employees in Vietnam also contribute to all three schemes but can claim a lump-sum SI refund upon departure.
Foreign contractors (companies or individuals) providing services in Vietnam can choose: (1) Flat 5% withholding on gross revenue (simple, common for short-term work), or (2) Register with tax authorities and pay regular progressive rates on net profit. Most foreign freelancers use the 5% deemed method. Vietnamese clients must withhold and remit.
Stock trading incurs only 0.1% transaction tax on sale value—no capital gains tax. Property transfers pay 2% on declared value. Securities transfer by non-listed companies: 0.1% or 20% on gains. Crypto taxation is unclear but treated as 'other income' at 2% of transfer value when enforced. Vietnam's low investment taxes attract regional traders.
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Last Updated: May 2026