THE MINISTRY OF FINANCE

Circular No. 111/2013/TT-BTC of August 15, 2013, guiding the Law on Personal Income Tax, the Law Amending and Supplementing a Number of Articles of the Law on Personal Income Tax and the Government’s Decree No. 65/2013/ND-CP detailing a number of articles of the Law on Personal Income Tax and the Law Amending and Supplementing a Number of Articles of the Law on Personal Income Tax

Pursuant to November 21, 2007 Law No. 04/2007/QH12 on Personal Income Tax;

Pursuant to November 22, 2012 Law No. 26/2012/QH13 Amending and Supplementing a Number of Articles of the Law on Personal Income Tax;

Pursuant to November 29, 2006 Law No. 78/2006/QH11 on Tax Administration;

Pursuant to November 20, 2012 Law No. 21/2012/QH13 Amending and Supplementing a Number of Articles of the Law on Tax Administration;

Pursuant to the Government’s Decree No. 65/2013/ND-CP of June 27, 2013, detailing a number of articles of the Law on Personal Income Tax and the Law Amending and Supplementing a Number of Articles of the Law on Personal Income Tax;

Pursuant to the Government’s Decree No. 83/2013/ND-CP of July 22, 2013, detailing a number of articles of the Law on Tax Administration and the Law Amending and Supplementing a Number of Articles of the Law on Tax Administration;

Pursuant to the Government’s Decree No. 118/2008/ND-CP of November 27, 2008, defining the functions, tasks, powers and organizational structure of the Ministry of Finance;

At the proposal of the General Director of Taxation;

The Minister of Finance guides a number of articles of the Law on Personal Income Tax, the Law Amending and Supplementing a Number of Articles of the Law on Personal Income Tax and the Government’s Decree No. 65/2013/ND-CP of June 27, 2013, detailing a number of articles of the Law on Personal Income Tax and the Law Amending and Supplementing a Number of Articles of the Law on Personal Income Tax, as follows:

Chapter I

GENERAL PROVISIONS

Article 1. Taxpayers

Taxpayers include resident and non-resident individuals specified in Article 2 of the Law on Personal Income Tax and Article 2 of the Government’s Decree No. 65/2013/ND-CP of June 27, 2013, detailing a number of articles of the Law on Personal Income Tax and the Law Amending and Supplementing a Number of Articles of the Law on Personal Income Tax (below referred to as Decree No. 65/2013/ND-CP), who earn taxable incomes specified in Article 3 of the Law on Personal Income Tax and Article 3 of Decree No. 65/2013/ND-CP.

Taxpayers’ taxable incomes are determined as follows:

Resident individuals’ taxable incomes are incomes earned inside and outside the Vietnamese territory, regardless of where the incomes are paid and received.

Non-resident individuals’ taxable incomes are incomes earned in Vietnam, regardless of where the incomes are paid and received.

1. A resident individual means a person who satisfies any of the following conditions:

a/ Being present in Vietnam for 183 days or more in a calendar year or 12 consecutive months counting from the first date of his/her presence in Vietnam, of which the date of arrival is counted as one (1) day and the date of departure is also counted as one (1) day. The date of arrival and date of departure are determined based on the immigration management agency’s certifications on his/her passport (or laissez-passer) upon his/her arrival at and departure from Vietnam. In case his/her entry and exit are on the same day, this day is counted as one day of residence.

An individual present in Vietnam under this Point means a person who is present in the Vietnamese territory.

b/ Having a place of habitual residence in Vietnam in either of the following cases:

b.1/ Having a place of habitual residence as prescribed by the law on residence:

b.1.1/ For Vietnamese citizens: The place of habitual residence means a fixed place where a person habitually and permanently resides for an indefinite time and for which he/she has made residence registration in accordance with the law on residence.

b/ For foreigners: The place of habitual residence of a foreigner means his/her place of permanent residence stated in his/her card of permanent residence or his/her place of temporary residence at the time of making registration for grant of a temporary residence card with a competent agency of the Ministry of Public Security.  

b.2/ Having rented a house for residence in Vietnam in accordance with the housing law under a rent contract with a term of 183 days or more in a tax year, specifically:

b.2.1/ An individual who has not yet found any or has no place of habitual residence as guided at Point b.1, Clause 1 of this Article, but has rented houses under rent contracts for 183 days or more in a tax year is also considered a resident individual, even in case he/she rents houses in several places.

b.2.2/ Houses rented for residence include hotels, guest houses, inns and working offices, regardless of whether such houses are rented by taxpayers themselves or by employers for their employees.

For an individual who has a place of habitual residence in Vietnam as prescribed in this Clause but is actually present in Vietnam for less than 183 days in a tax year, if he/she cannot prove the country of which he/she is a resident, he/she is a Vietnamese resident.

An individual will be proved to be a resident of another country based on his/her certificate of residence. Individuals who are residents of countries or territories which have signed tax agreements with Vietnam shall provide copies of their passports to prove the period of their residence, if such countries or territories do not provide for the issuance of certificates of residence.

2. A non-resident individual means a person who does not satisfy the conditions specified in Clause 1 of this Article.

3. Taxpayers in some specific cases are identified as follows:

a/ For individuals earning incomes from business activities

a.1/ In case only one person is named in the business registration certificate, he/she is a taxpayer.

a.2/ In case more than one person are named in the business registration certificate (a group of business individuals) and jointly conduct business activities, every member who is named in the business registration certificate is a taxpayer.

a.3/ In case many members of a household jointly conduct business activities but only one of them is named in the business registration certificate, the person who is named in the business registration certificate is a taxpayer.

a.4/ In case an individual or a household actually conducts business activities but does not have a business registration certificate (or practice certificate or license), the individual currently conducting business activities is a taxpayer.

 

a.5/ For lease of houses or rights to use land, water surface or other assets without business registration, house owners or holders of the right to use land, water surface or other assets are taxpayers. In case many individuals jointly own a house or jointly hold the rights to use land, water surface or other assets, every individual owning the house or holding the use rights is a taxpayer.

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