On June 30, 2026, the Government issued Decree No. 253/2026/ND-CP detailing some provisions and measures to organize and guide the implementation of the Personal Income Tax Law.
This Decree introduces quite a few changes to personal income tax (PIT) policy, notably including the following changes:
1. Detailed regulations regarding “Resident Individuals” and “Non-Resident Individuals”:
Duration of Residence: Specifically defines the criterion as 183 days or more, including the calendar year and 12 consecutive months. It clearly specifies how to calculate arrival and departure dates, and entry/exit dates on the same day.
Permanent Residence: Expands and clarifies two cases for determining permanent residence:
Permanent Residence Registration: Specific regulations apply to both Vietnamese citizens and foreigners (via Permanent Residence Card or declaration when issuing Temporary Residence Card).
Rental Property: Clearly defines the rental contract term as 183 days or more in the tax year. Specifically, it includes accommodation in hotels, guesthouses, motels, lodging houses, workplaces, office buildings, and even cases of renting multiple properties.
Special Cases: Clearly defines that an individual with a permanent residence but actually present in Vietnam for less than 183 days, without being able to prove residence in another country, is considered to be residing in Vietnam.
2. Expanding and Clarifying Taxable Income:
Income from Business Activities: Adding e-commerce and digital-based businesses to the list of taxable income.
Income from Salaries and Wages:
Excess Expenses: Adding a regulation that the portion of expenses for stationery, travel expenses, telephone, and clothing exceeding the prescribed limit will be included in taxable income.
Housing, Electricity, and Water Expenses: Clearly defining that if an employee benefits from housing built by the employer, it will not be included in taxable income. Conversely, rent, electricity, and water expenses paid by the employer will be included in taxable income, but with a limit (not exceeding 15% of total taxable income).
Bonuses: Adding bonuses in the form of securities to the list of taxable income.
Other benefits: Clarifying that expenses for consulting services, tax processing services, hiring domestic helpers, drivers, etc., paid by employers to employees are all included in taxable income.
Allowances, subsidies, and other income: Adding some subsidies that are not included in taxable income, for example, one-time allowances for individuals transferring to areas with particularly difficult socio-economic conditions, support for officials working on maritime sovereignty, etc.
Income not in the nature of salaries or wages not included in taxable income: Adding many cases such as airfare for foreigners returning home on leave, tuition fees for children of foreign workers studying in Vietnam, non-mandatory insurance products and those without accumulated insurance premiums.
Income from capital investments: Income from dividends paid in shares, and shares issued from equity capital to existing shareholders, is now included in the taxable income category.
3. Expanding the scope of tax exemptions and reductions:
Tax exemption for income from the transfer, inheritance, or gift of real estate: Expanding the tax exemption to include siblings.
Tax exemption for the transfer of a single house or land: Specifying more detailed conditions for tax exemption, such as a minimum ownership period of 183 days and the transfer of the entire property.
Tax exemption for income from the value of land use rights granted to individuals by the State: Clarifying cases where land transfer is exempted/reduced from land use fees and requires tax declaration and payment.
Tax exemption for income of households and individuals directly engaged in agriculture, forestry, livestock, aquaculture, and salt production: Clearly define conditions regarding land use rights, land lease, local residence, and cases of subleasing land.
Tax exemption for income from dividends of cooperative members and individuals participating in “Large-Scale Farming,” afforestation, and aquaculture: Add specific conditions.
Personal income tax exemption for a period of 5 years for income from salaries and wages of individuals who are high-quality digital technology and high-tech personnel: This is a new and important point, aimed at attracting and retaining talent in technology fields.
Tax exemption for the transfer of open-ended fund certificates: A minimum holding period of 2 years is required.
50% reduction in personal income tax for 5 years on investor dividends from securities investment funds and real estate investment funds.
Several new tax exemptions have been added: such as income from salaries and wages of Vietnamese crew members working on foreign/Vietnamese international transport vessels, income from the provision of goods and services directly serving offshore fisheries, income from the transfer of emission reduction certificates, carbon credits, green bonds, income from copyright of scientific, technological and innovative projects, income of individual investors/experts from innovative startup projects, income from salaries of foreign experts working in ODA/non-governmental projects, Vietnamese individuals working at UN representative offices, individuals participating in UN peacekeeping forces, and income of private business owners/single-member limited liability companies after fulfilling corporate income tax obligations.
4. Changes to regulations regarding deductions:
Personal Deductions:
• Clarifying cases where children aged 18 and above are still eligible for deductions (due to lack of civil capacity, disability, or inability to work).
• Adding cases where children attending university, college, vocational school, or high school are still eligible for deductions if they meet income requirements.
• Clarifying cases where other individuals without means of support are considered dependents.
• Defining individuals as those with a disability rate of 81% or higher as inability to work.
• Taxpayers are responsible for registering and verifying the accuracy of their dependent registration.
Deductions for charitable and humanitarian contributions and medical and educational expenses:
Deduction limits for medical and educational expenses: Specifying a maximum limit for each item (medical: 23 million VND/year, education: 24 million VND/year).
Conditions for deductible expenses: Requires legal invoices or supporting documents showing taxpayer/dependent information, and must not be paid from other sources.
Transfer of expenses: Expenses for healthcare and education that are deductible in a given year must be claimed as deductions in that year and cannot be carried over to the following year.
5. Changes to regulations regarding tax deductions:
10% deduction for income of VND 5 million or more per payment: The rate remains at 10%, but the minimum income payment threshold for mandatory deduction is raised from VND 2 million to VND 5 million per payment.
Increased deduction for supplementary retirement insurance, voluntary insurance, and life insurance: The maximum deduction is increased to no more than VND 3 million per month.
Detailed tax regulations for stock bonuses and ESOP shares:
Bonus shares: Tax is not calculated upon receipt of shares; personal income tax on salary and wages is payable upon transfer.
ESOP shares: Similarly, tax is not calculated upon receipt; personal income tax on salary and wages is payable upon transfer.
Regulations on life insurance (excluding supplementary and voluntary) with accumulation: Tax is not calculated upon receipt; a 10% tax deduction is applied to accumulated premiums exceeding the stipulated amount upon maturity.
Non-resident individuals working simultaneously in Vietnam and abroad: Provide a formula for separating income generated in Vietnam.
6. Changes to regulations regarding tax calculation and settlement:
Income from capital investments:
Stock dividends, shares issued from equity capital: Tax not yet paid upon receiving shares, personal income tax payable on capital investments and securities transfers upon transfer.
Capital gains: Tax not yet paid upon capital gains, personal income tax payable on capital investments and capital transfers upon transfer/withdrawal/dissolution.
Income from capital transfers: Clearly defines the method for calculating the purchase price, reasonable expenses, and specific cases.
Income from securities transfers: Maintains the 0.1% tax rate but clarifies how to determine the transfer price and the timing of determining taxable income.
Income from real estate transfers:
• Maintains the 2% tax rate.
• Detailed regulations on determining the transfer price in cases where the contract does not specify a price, the price is lower than the stipulated price, and the transfer of real estate under construction.
• Clarify cases involving co-ownership, authorization, mortgage, enforcement of judgments, and transfer of land and houses.
Income from lottery winnings, royalties, franchise fees, inheritance, gifts, and other income: Detailed regulations on how to calculate taxable income and the timing of determining taxable income, particularly clarifying cases of winning multiple prizes, receiving inheritances/gifts in the form of securities, capital contributions, or real estate.
Tax settlement: Clearly defines cases where tax settlement is not required and where tax settlement can be authorized on behalf of another party.
7. Other notable new features:
Effective Date: This Decree takes effect from July 1, 2026.
Replacement of Decree No. 65/2013/ND-CP: This Decree completely replaces Decree 65/2013/ND-CP.
Repealed: Article 3 of Decree No. 91/2014/ND-CP dated October 1, 2014; Article 2 of Decree No. 12/2015/ND-CP dated February 12, 2015.
Appendix to the list of industries and occupations subject to personal income tax on revenue: An appendix is added detailing the list of industries and occupations subject to personal income tax based on revenue for resident individuals with income from business activities.
