Official Document 1296/CT-NVT Issued by the Tax Department on March 4, 2026, this document is a key guideline aimed at unifying the declaration and settlement of personal income tax (PIT) for the 2025 tax year and subsequent tax periods from 2026 onwards. This document specifies the regulations at Personal Income Tax Law No. 109/2025/QH15 and Resolution 110/2025/UBTVQH15 Regarding adjustments to the personal allowance as well as the new progressive tax rate schedule.
Understanding the content of Circular 1296/CT-NVT helps businesses and individuals avoid legal errors, optimize tax payments, and expedite the automatic tax refund process. For accounting and auditing professionals, this is a crucial legal basis for providing accurate tax reporting advice and services. Let's analyze the new points in detail in the article below, brought to you by MAN – Master Accountant Network.
Determining income from salaries and wages according to Official Letter 1296/CT-NVT
Official document 1296/CT-NVT is based on the Personal Income Tax Law 2025 to determine taxable income. This helps taxpayers accurately classify their annual income to fulfill their tax obligations correctly.
Income subject to personal income tax
According to the guidelines, income from salaries and wages includes: salaries, wages, and equivalent payments. In addition, fees, monetary or non-monetary benefits, and allowances (excluding preferential treatment for meritorious individuals, hazardous work allowances, and social insurance benefits) are also subject to tax.
Time of determining taxable income
Official document 1296/CT-NVT clarifies the time of determining taxable income for resident individuals. This is the time when the organization pays the income or the time when the taxpayer actually receives the income. Accurately determining this time helps avoid errors when allocating income to different tax periods.
New points regarding personal deductions according to Official Letter 1296/CT-NVT
The change in personal deductions is the core issue addressed in Official Letter 1296/CT-NVT. The document clearly distinguishes between the 2025 tax year (applying the old regulations) and the 2026 tax year (applying the new regulations) to ensure taxpayers comply accurately.
Personal deductions applicable to the 2025 tax year.
In the 2025 tax year, Official Letter 1296/CT-NVT confirms the continued application of Resolution No. 954/2020/UBTVQH14. This deduction is based on the previous economic context. Specifically, the deduction for the taxpayer themselves is 11 million VND/month (132 million VND/year) and for each dependent is 4.4 million VND/month.
Adjustment of personal allowance deductions starting in 2026.
Entering 2026, Official Document 1296/CT-NVT emphasizes the implementation of Resolution No. 110/2025/UBTVQH15. This is an effort by the Government to support people facing the pressure of rising living costs. The new deduction for the individual is VND 15.5 million/month (VND 186 million/year) and for each dependent is VND 6.2 million/month.
The application of the new deductions as guided by Circular 1296/CT-NVT will help millions of workers increase their real income. At the same time, this policy helps reduce the administrative burden on tax authorities by raising the tax threshold, in line with current fluctuations in average income.
Changes to the progressive tariff schedule as per Official Letter 1296/CT-NVT
Besides the tax reduction, Circular 1296/CT-NVT also clarifies the change in the tax bracket structure. From 2026, the tax schedule will be streamlined from 7 brackets to 5 brackets to simplify the calculation and management process.
Below is a comparison table based on data from Official Letter 1296/CT-NVT to help taxpayers visualize the differences between the two tax periods:
| Tax rates | Taxable income/month (Period 2025) | Tax rate | Taxable income/month (Period 2026) | Tax rate |
| 1 | Up to 5 million VND | 5% | Up to 10 million VND | 5% |
| 2 | Over 5 to 10 million VND | 10% | Between 10 and 30 million VND | 10% |
| 3 | Between 10 and 18 million VND | 15% | Between 30 and 60 million VND | 20% |
| 4 | Between 18 and 32 million VND | 20% | Over 60 to 100 million VND | 30% |
| 5 | Between 32 and 52 million VND | 25% | Over 100 million VND | 35% |
| 6 | Between 52 and 80 million VND | 30% | – | – |
| 7 | Over 80 million VND | 35% | – | – |
Data from Official Letter 1296/CT-NVT shows that the lowest tax bracket (5%) has had its income threshold doubled. This brings direct and practical benefits to the group of low- and middle-income workers in society.
Individuals required to file personal income tax returns according to Official Letter 1296/CT-NVT
Identifying the correct taxpaying entity is the first step in complying with tax laws. Circular 1296/CT-NVT divides entities into two main groups: organizations paying income and individuals receiving income from salaries and wages.
For organizations and individuals paying income
According to Official Letter 1296/CT-NVT, organizations paying salaries must file tax returns regardless of whether deductions are made or not. This helps the tax authorities have complete data for verification. If the business is dissolved or reorganized, the tax return must be completed at the time of cessation of operations.
For individuals who directly settle accounts.
Individuals residing in Vietnam who have income from multiple sources or have additional tax payments exceeding VND 50,000 are required to file their tax returns in person. Circular 1296/CT-NVT also notes that foreigners whose contracts in Vietnam have ended must file their tax returns before departure to fulfill any outstanding tax obligations.
Using the eTax Mobile application, as recommended in Official Letter 1296/CT-NVT, helps individuals transparently check their income. The system will automatically notify those who need to submit tax returns, minimizing the risk of penalties for late payment or omission of tax obligations.
If the calculation process and documentation are causing you difficulties, MAN provide Comprehensive personal income tax settlement service, Professional. We help you optimize your tax payments, process tax refund applications quickly, and ensure absolute accuracy in accordance with Circular 1296/CT-NVT.
Cases exempt from tax finalization according to Official Letter 1296/CT-NVT
To streamline administrative procedures, Official Letter 1296/CT-NVT details the cases that do not require these procedures. personal income tax settlement. This helps citizens save time and allows tax authorities to focus their resources more effectively. Exempt cases include:
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The amount of additional tax payable after final settlement is 50,000 VND or less: Individuals are completely exempt from tax, determine the amount exempted themselves, and do not have to submit any tax return or exemption documents.
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There is an overpayment of tax that is not eligible for a refund or offset: In cases where the amount of tax payable is less than the amount of tax already paid provisionally, but the individual does not request a refund or offset against the next period.
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Has any current income been subject to deductions (10%): This applies to individuals with employment contracts exceeding 3 months at one place, with average monthly incidental income from other sources not exceeding 10 million VND after deducting 10% and having authorized tax settlement at the place where the main contract was signed.
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Income from accumulated insurance after deductions 10%: The premiums for life insurance (excluding voluntary retirement insurance) or other non-mandatory insurance with accumulated funds purchased by the employer have been deducted from personal income tax (10%).
Procedures and guidelines for automatic tax refunds according to Official Letter 1296/CT-NVT
A key highlight of Official Document 1296/CT-NVT is the guidance on the process. personal income tax refund Automatic. This technology helps individuals quickly receive refunds for overpaid taxes without having to go through complicated paperwork.
Conditions for automatic tax refund processing
For the application to be processed automatically, individuals need to ensure their tax identification number is accurate and their bank account number is updated. Circular 1296/CT-NVT requires that income data from paying entities must match the individual's tax return on the centralized tax management system.
Responsibilities of the tax authorities and support
The tax authorities are responsible for reviewing, supporting, and ensuring the smooth operation of the system. According to Official Letter 1296/CT-NVT, the management agency will accelerate the processing of tax refund applications through the electronic environment, helping to reduce waiting times and improve the quality of service for citizens.
Conclude
Circular 1296/CT-NVT serves as a guideline for personal income tax settlement in the 2025-2026 period. Understanding the new family allowance deductions and the simplified tax schedule helps businesses comply with the law and protect the rights of their employees. These updates are positive signals supporting workers in the new economic context.
If your company is facing difficulties in data extraction or is concerned about errors in records according to Official Letter 1296/CT-NVT, let MAN be your partner. We provide comprehensive solutions. auditing services, tax accounting, and tax consulting services, tax settlement and tax reporting. With our team of experts, MAN is committed to optimizing your tax obligations and helping you focus on your business.
Service contact information at MAN – Master Accountant Network
- Address: No. 19A, Street 43, Tan Thuan Ward, Ho Chi Minh City
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- Email: man@man.net.vn
Content production by: Mr. Le Hoang Tuyen – Founder & CEO MAN – Master Accountant Network, Vietnamese CPA Auditor with over 30 years of experience in Accounting, Auditing and Financial Consulting.
Frequently Asked Questions about Official Document 1296/CT-NVT
According to Official Letter 1296/CT-NVT, if your total income is below the taxable threshold after deductions, tax finalization is not mandatory. However, if you wish to claim a refund of the provisional tax payments, you still need to submit the necessary documents.
It's not necessary. Official document 1296/CT-NVT clearly states that organizations that do not generate income payments during the calendar year are not required to file personal income tax final settlement returns.
According to Official Letter 1296/CT-NVT, that is the time when the organization pays you the income or the time when you actually receive that income. I have income from two sources, but each source only pays 5 million VND per month. Do I need to file a tax return?
If a business does not pay any salaries during the year, is it still required to file a tax return?
When is taxable income from salary determined?
