On the morning of December 10, the National Assembly voted to pass the amended Law on Personal Income Tax (PIT) with 438/443 delegates present in favor, reaching 92.6% of the total number of delegates.
The Law consists of 30 articles, effective from July 1, 2026, fully regulating taxpayers and individuals' taxable incomes such as income from business, wages, wages, capital investment, capital transfer, real estate transfer, winning prizes, patents, commercial franchises, inheritance, gifts of securities, capital and other incomes such as digital asset transfers, gold bars.
Many income items are exempt from tax
According to the new law, many income items are exempt from personal income tax. Including income from transfer, inheritance, or gift-giving of real estate; transfer of housing, land use rights and assets attached to residential land in cases where individuals have only one house or land; income from the value of land use rights of individuals allocated by the State.
The income of households and individuals directly producing agricultural products such as crops, forests, livestock, aquaculture, unprocessed or only pre-processed seafood fishing; salt production; conversion of agricultural land allocated by the State... are all subject to tax exemption. The law also stipulates tax exemption for interest from government bonds, local government bonds, interest on bank deposits;ants; wages for night work, overtime; pensions; scholarships.
Notably, the law has specifically regulated personal income tax on business income of households and individuals.
Business households with revenue under VND500 million/year are exempt from tax
The new law clearly states: Households and individuals with a revenue of VND500 million/year or less will not have to pay personal income tax. With this regulation, most small households will not have to pay taxes.
For households and individuals with a revenue of over VND500 million to VND3 billion/year, the applicable tax rate is 15%. In cases with revenue of over VND3 billion to VND50 billion/year, a tax rate of 17% will be applied, while revenue over VND50 billion/year is subject to a tax rate of 20%.
Before the Law was passed, Minister of Finance Nguyen Van Thang said that the drafting agency had received the opinions of National Assembly deputies and adjusted the non-taxable revenue of households and individuals doing business from 200 million VND/year to 500 million VND/year; at the same time, allowed this level to be deducted before calculating tax according to the ratio on revenue. The revenue not subject to value added tax will also be adjusted to VND500 million/year.
The Law adds a method of calculating tax on income (revenue minus expenses) for households and individuals doing business with a revenue of over VND500 million/year to VND3 billion/year, applying a tax rate of 15% - similar to the corporate income tax rate for enterprises with a revenue of less than VND3 billion/year.
Households and individuals doing business in this group can choose between the method of calculating tax based on income or calculating based on the ratio on revenue, depending on actual conditions.
