The progressive personal income tax schedule applies to income from wages and salaries with 7 tax brackets from 5% to 35%. Understanding how to calculate progressive personal income tax, understanding taxable income levels, deductions and methods of monthly or yearly declaration will help employees be proactive in declaring, avoiding incorrect or insufficient tax payment.
What is the progressive personal income tax schedule? Who does it apply to?
The progressive personal income tax is a method of calculating tax based on the principle that the higher the income, the higher the tax rate, in order to ensure fairness in budget contributions. This is the most common form of tax calculation, applied to income from salaries and wages - the type of income that accounts for the majority of workers.
According to Personal Income Tax Law Currently, there are two types of tax schedules applied: the fully progressive tax schedule and the partially progressive tax schedule. Of which, the partially progressive tax schedule is the standard calculation method applied to regular income such as monthly salary or annual settlement. This tax schedule divides total income into many parts and each part is taxed at different levels, from 5% to 35%.
The subjects applying the progressive personal income tax schedule include resident individuals with income from salaries, wages, labor contracts of 3 months or more or with irregular income but subject to self-declaration of tax. For non-resident individuals, a fixed tax rate will be applied instead of a progressive schedule.
How to calculate progressive personal income tax according to the 7-step tax table
The progressive personal income tax rate currently applied in Vietnam is divided into 7 levels with increasing tax rates from 5% to 35%. The calculation is divided by month or year depending on each specific case.
Latest monthly progressive tax schedule 2025
According to Article 22 of the Law on Personal Income Tax (amended), the monthly progressive tax schedule applies to people with regular income from salary. The taxable income is the remaining amount after deducting personal and dependent deductions. Specifically, the monthly tax schedule for 2025 is as follows:
| Level | Taxable income/month (million VND) | Applicable tax rate |
|---|---|---|
| 1 | Up to 5 | 5% |
| 2 | Over 5 to 10 | 10% |
| 3 | Over 10 to 18 | 15% |
| 4 | Over 18 to 32 | 20% |
| 5 | Over 32 to 52 | 25% |
| 6 | Over 52 to 80 | 30% |
| 7 | Over 80 | 35% |
Progressive Annual Tax Rate – When Should You Choose This Method?
The annual progressive tax schedule is applied to cases where tax is settled at the end of the year, or people with variable income (freelance, working in multiple places, receiving one-time bonuses, etc.). The total taxable income in the year will be divided according to the annual income threshold and the same tax rate as the monthly schedule will be applied, but multiplied by a factor of 12.
In the case of an individual with a total annual income of VND 300 million, after deductions, the remaining amount is VND 220 million, this part will be divided into levels according to the progressive tax table each year to calculate personal income tax. This tax table is especially important in the year-end tax settlement, which usually takes place in March of the following year.
Instructions on how to calculate personal income tax according to the progressive tax schedule
Standard progressive personal income tax calculation formula according to the General Department of Taxation
The standard formula used to calculate personal income tax under the progressive tax schedule is:
| Personal income tax payable = Total tax of all levels calculated according to the progressive tax table |
Before applying the tariff, you need to determine:
-
Total taxable income: total salary, bonus, allowance (if taxable)
-
Deductions: include personal deduction (11 million/month), dependent deduction (4.4 million/person/month) and mandatory insurance contributions, charity...
For example: An individual has an income of 25 million/month, no dependents, after deducting 11 million, the remaining taxable income is 14 million. This amount will be divided into:
-
The first 5 million will be charged 5% = 250,000
-
The next 5 million will be subject to 10% = 500,000
-
The remaining 4 million is 15% = 600,000
Total personal income tax = 250,000 + 500,000 + 600,000 = 1,350,000 VND/month
Latest 2025 Tax Rates and Deductions
There will be no change in family deductions in 2025. Specifically:
-
Personal deduction: 11 million VND/month (132 million VND/year)
-
Dependent deduction: 4.4 million VND/person/month (52.8 million VND/year)
In addition, taxpayers are also entitled to deduct contributions to compulsory social insurance, health insurance, unemployment insurance and certain charitable contributions if they can be properly proven.
Calculate Progressive Tax Online: Fast and Accurate Solution for Individuals
With the development of technology, workers can now quickly calculate progressive taxes online through tools such as:
-
Official website of the General Department of Taxation: provides income input tool - automatic tax calculation according to 7-level table.
-
Accounting software such as MISA, Fast: for businesses but also has versions for individuals.
-
Automated Excel tool for progressive tax rates: many accountants use it to review payroll.
Regardless of which tool you use, you still need to double-check that the deductions have been applied correctly. Especially for those with young children or elderly dependents, correct declaration will significantly reduce the amount of tax payable.
Important notes when applying the progressive personal income tax schedule
Some cases where employees are likely to make mistakes when calculating personal income tax:
-
Salary received from many places: you still have to summarize all income to settle, not calculate each place separately according to the tax table.
-
Tet bonus or irregular income: although not fixed monthly, it must still be added to total income and calculated according to a progressive scale.
-
Failure to claim dependents on time: You may not be able to claim deductions for previous months if you do not file on time.
Although the personal income tax schedule is divided into steps and progressive in each part, if you understand how it works, you can completely control your tax obligations and even minimize the amount of tax payable while still complying with the law.
Conclusion and recommendations
The progressive personal income tax is an important tool to ensure equitable tax distribution according to income. Understanding how to apply the progressive tax rate on a monthly or annual basis not only helps employees be financially proactive, but also avoids errors in the tax settlement process.
If you are a worker, have multiple sources of income or are wondering about finalizing personal income tax at the end of the year, do not hesitate to contact us. MAN – Master Accountant Network for expert advice and support.
Contact MAN – Master Accountant Network now
- Address: No. 19A, Street 43, Tan Thuan Ward, Ho Chi Minh City
- Mobile/Zalo: 0903 963 163 – 0903 428 622
- E-mail: man@man.net.vn
