Personal Income Tax 2025 is having many notable changes, directly affecting employees, business households and income-paying enterprises. Adjustments to family deductions, progressive tax tables and new tax calculation methods are issued to ensure fairness and suitability with socio-economic fluctuations. The following article will help you understand the latest changes and guide you on how to apply personal income tax 2025 to declare and pay taxes accurately and effectively.
Personal income tax overview
Personal Income Tax 2025 is an important part of the tax system in Vietnam, applicable to resident and non-resident individuals with taxable income. Mastering the regulations on personal income tax 2025 not only helps taxpayers fulfill their legal obligations but also optimizes costs and reduces the risk of being penalized by tax authorities.
Personal Income Tax 2025 is updated based on the latest circulars, decrees, adjustments to tax schedules, family deductions, tax exemptions and tax calculation methods for each subject.
What is personal income tax?
Personal Income Tax 2025 is a direct tax, levied on the income of individuals arising during the tax period. This Personal Income Tax 2025 applies to individuals with income from salaries, business, real estate transfer, capital investment and other sources of income as prescribed.
Taxable income is calculated based on total income minus legal deductions such as family allowances, social insurance, health insurance and other contributions as prescribed.
The role of personal income tax
Personal Income Tax 2025 plays an important role in the economy:
- Revenue for the state budget: Personal Income Tax 2025 contributes to ensuring financial resources for public activities, infrastructure and social security.
- Adjusting personal income: Helps reduce income inequality, promoting social equity.
- Increasing financial transparency: The personal income tax declaration and payment 2025 in accordance with regulations helps tax authorities control revenue sources and prevent revenue loss.
- Support for businesses and individuals: Understanding personal income tax 2025 helps businesses and individuals plan their finances properly.
Legal basis related to personal income tax
Implementing personal income tax 2025 in accordance with regulations requires individuals and businesses to have a firm grasp of basic legal documents. These documents determine taxable subjects, tax schedules, methods of calculation, declaration and settlement of taxes, and help avoid legal risks when performing tax obligations. Below are important legal documents related to personal income tax 2025:
| Legal documents | Main content | Role in Personal Income Tax 2025 |
| Personal Income Tax Law (Law No. 04/2007/QH12, modified) | Determine tax base, taxable and non-taxable income, applicable subjects. | Is the basic legal basis for all regulations. |
| Law No. 56/2024/QH15 (Amending some Laws) | Amending and supplementing a number of articles of the Law on Personal Income Tax and other Laws. | Update the latest regulations of the National Assembly, especially related to tax management and responsibilities of the parties. |
| Resolution of the National Assembly Standing Committee (On new GTGC level) | Decision to adjust family deduction level to 15.5 million VND and 6.2 million VND. | Basis for applying new family deductions from tax period 2026. |
| Decree 65/2013/ND-CP (and amended Decree) | Detailed instructions on the implementation of the Personal Income Tax Law on tax calculation methods, tax declaration and payment deadlines. | Detailed instructions on the Law, helping to fulfill tax obligations in accordance with administrative procedures. |
| Decree 126/2020/ND-CP | Detailed regulations on tax administration, including dossiers, deadlines for submitting tax declarations (PIT) and places of submission. | Prescribe important administrative procedures (time limits, documents) in declaration and settlement. |
| Circular 111/2013/TT-BTC (and Circular amending and supplementing) | Specific instructions on how to prepare, declare, pay personal income tax, finalize tax, details on tax deductions and exemptions. | Is the most detailed guide on tax declaration and settlement. |
| Circular 80/2021/TT-BTC | Detailed instructions on Decree 126/2020/ND-CP on tax administration, including forms and regulations on settlement authorization. | Detailed instructions on administrative procedures and tax filing forms. |
Important changes in personal income tax 2025
The Vietnamese Government has officially approved a Resolution adjusting the personal income tax deduction for 2025, a major change aimed at reducing the financial burden on workers amid rising living costs. The Resolution stipulates that the new deduction will be applied from the 2026 tax period.
To help taxpayers, businesses and accountants easily grasp, below is a detailed summary table comparing the current deduction levels (in 2025) with the new levels that will take effect from 2026, along with the estimated income levels that must start paying tax under the new regulations:
| Content changes | Current Level (2025) | Applicable from 2026 | Important notes |
| Personal deduction | 11 million VND/month | 15.5 million VND/month (186 million VND/year) | The increase is 4.5 million VND/month compared to the current level, adjusted according to the Resolution of the National Assembly Standing Committee. |
| Family deduction for each dependent | 4.4 million VND/month | 6.2 million VND/month | The increase is 1.8 million VND/month compared to the current level. |
| Time of application | Income from 01/07/2020 | From tax period 2026 (Income arising from 01/01/2026) |
Personal income tax payers
Personal income tax is applied to individuals with income arising in Vietnam. The determination personal income tax payers based on residency criteria, income range and taxable income types as prescribed in the Personal Income Tax Law. The table below summarizes the details:
| Object | Criteria (Clause 1, Article 2 of the Law on Personal Income Tax) | Taxable scope | Typical examples of taxable income |
| Resident Individual | Individuals who are present in Vietnam for 183 days or more in a calendar year or for 12 consecutive months from the first day of presence in Vietnam. Individuals who have a permanent residence in Vietnam, including a registered permanent residence or a rented house for 183 days or more in a tax year. | All income arising in and outside Vietnam (Global Tax Principles). | Salaries, wages, income from business, capital investment, capital transfer, real estate transfer, copyright, winnings, gifts, inheritance. |
| Non-resident individual | Does not meet the criteria for individual residency. | Only income arising in Vietnam (Territorial Tax Principle). | Salaries and wages received from work in Vietnam; income from capital/real estate transfer in Vietnam; royalties paid by Vietnamese organizations/individuals. |
| Taxable income | Applies to both resident and non-resident individuals (with respective taxable scope). | Income received that is not subject to tax exemption. | Income from business, wages, salaries, capital investments, capital transfers, real estate transfers, prizes, copyrights, franchises, inheritances, and gifts. |
| Tax-free/reduced income | According to specific provisions in Article 4 of the Law on Personal Income Tax and guiding documents. | Not included in taxable income or tax deductible. | Allowances and benefits according to law; insurance contract compensation, compensation for damages; income from remittances; income from interest on deposits at credit institutions; higher wages paid for overtime and night work. |
Instructions for applying personal income tax 2025 for individuals
To properly fulfill tax obligations in 2025, individuals need to clearly understand the steps of applying personal income tax from determining taxable subjects, taxable income to applying the corresponding tax rates and tax declaration and payment. Understanding each step not only helps individuals declare taxes accurately but also optimizes deductions, avoids errors and violations of the law.
In this guide, we will go from basic to detailed, clearly explaining about resident and non-resident individuals, types of taxable income, applicable tax rates and how to declare and pay taxes according to the latest regulations in 2025.
Identify taxable entities
First of all, individuals need to determine whether they are subject to personal income tax in 2025.
- Resident individuals: Are those who are present in Vietnam for 183 days or more in a year or have a permanent residence in Vietnam (registered permanent residence or rented house for 183 days or more). Resident individuals are subject to tax on all income generated within and outside the territory of Vietnam, applying global tax principles.
- Non-resident individuals: Are individuals who do not meet the above criteria. These individuals are only subject to tax on income arising in Vietnam, according to the territorial tax principle.
Determining taxable income
Individuals need to know which income is taxable to calculate the amount of tax payable:
- Income from salaries and wages:
Taxable income is calculated by subtracting actual income from deductions such as: personal deduction, dependent deduction, compulsory insurance contributions, and legal voluntary pension funds. This is an important step in determining the actual taxable income. - Other income: Includes income from business, real estate transfer, securities, capital investment, winnings, copyright, franchise...
For these amounts, no family deductions apply. The entire amount actually received will be taxable income, and the corresponding tax rate will apply according to the type of income.
Applicable tax rate
After determining taxable income, the next step is to apply the tax rate corresponding to each type of income to calculate the 2025 personal income tax payable.
- For income from salaries and wages of resident individuals, a progressive tax schedule is applied, meaning the tax rate increases gradually according to income level, to ensure fairness between individuals with different incomes.
- For other income, including business, transfer, capital investment, prize winnings, copyrights, etc., a separate fixed tax rate is applied to each type of income according to the law.
| Income type | Tax rate (%) | Note |
| Income from wages and salaries (resident individuals) | Apply progressive tax schedule |
Tax rates increase gradually according to income levels to ensure fairness. |
| Business income | 0.5 – 5 | According to the form of declaration or contract, depending on the industry |
| Real estate transfer | 2 | Calculated on transfer price or tax price according to regulations |
| Securities transfer | 0,1 | Calculated on transfer price |
| Winning, copyright, franchise | 10 | Calculated on total actual income received |
| Capital investment (dividends, profits…) |
5 |
Calculated on total realized profit |
Tax declaration and payment
After calculating income and tax rate:
- Individuals can declare taxes directly to the tax authority or through income-paying organizations (such as companies and businesses).
- Resident individuals are entitled to family deductions when declaring payroll taxes.
- Non-resident individuals pay flat tax at the prescribed rate without any deductions.
- It is necessary to comply with the tax payment deadline as prescribed by the tax authorities in 2025 to avoid late payment penalties.
Instructions for applying personal income tax 2025 for businesses
Enterprises are organizations that pay income, are responsible for deducting, declaring and paying personal income tax 2025 on behalf of employees. Correct application of regulations helps enterprises comply with the law and avoid tax risks.
Identify taxable entities
When paying income, businesses must determine whether the recipient is a resident or non-resident individual, because the tax calculation is different:
- Resident individuals: businesses deduct tax based on taxable income minus prescribed deductions.
- Non-resident individuals: businesses deduct tax at a flat rate without applying any deductions.
Determining taxable income
Businesses need to clearly identify all income that must be deducted from tax:
- Income from wages and salaries: total income actually paid to an individual after calculating legal deductions.
- Other income (bonuses, dividends, transfers, royalties, etc.): the total amount paid by the enterprise is taxable income, without family deductions.
Tax deduction and payment at source
When paying income to individuals, businesses do not simply pay salaries or bonuses, but are also responsible for withholding and paying personal income tax 2025 on behalf of employees. This helps ensure that individuals pay taxes in full and businesses comply with the law.
Determine the amount of tax to be deducted
When paying income to employees or other individuals, businesses not only pay money but also have to deduct and pay personal income tax at source. This ensures that individuals pay taxes in full and businesses comply with the law. The following section guides how to apply personal income tax 2025 according to each type of income.
- Income from salaries and wages: apply progressive tax schedule for resident individuals, deducted immediately upon salary payment.
- Other income (business, transfer, investment, prize winnings, etc.): applies a fixed tax rate according to the type of income, calculated on the total amount paid, without family deductions.
| Income type | Tax rate (%) |
| Income from wages and salaries | Progressive tax schedule |
| Business | 0.5 – 5 |
| Real estate transfer | 2 |
| Winning, copyright, franchise | 10 |
| Capital investment (dividends, profits…) | 5 |
Deduction at source
Once the taxable income and applicable tax rate have been determined, the next step for businesses is to deduct 2025 personal income tax at source. This is an important step to ensure that taxes are paid correctly, promptly and in compliance with the law.
- Businesses deduct tax immediately upon paying income, before individuals receive the money.
- The deducted tax amount will be the amount the enterprise must pay to the state budget.
- Correct and timely deductions help businesses avoid the risk of violating the law and late payment penalties.
Records and documents to be kept
To ensure that the deduction and payment of personal income tax 2025 is carried out accurately, businesses need to keep complete records and related documents. These documents not only help with internal management but also serve the inspection and audit of tax authorities.
- Payroll, labor contract, income payment documents.
- Tax calculation minutes, monthly or quarterly personal income tax declaration.
- Documents related to other income (bonuses, transfers, investments…).
Tax declaration and payment
Enterprises are responsible for declaring and paying personal income tax 2025 on behalf of individuals according to regulations of tax authorities.
- Tax declaration: Enterprises prepare personal income tax declarations 2025 monthly or quarterly, based on the amount of tax deducted at source from the income of employees and individuals receiving income.
- Tax payment: The deducted tax must be paid to the state budget on time to avoid late payment penalties.
Enterprises need to carefully check data, applicable tax rates and keep all relevant documents, contracts, payrolls and invoices to ensure compliance with the law and facilitate future inspections and audits.
Important notes when applying personal income tax 2025
When applying personal income tax 2025, businesses and individuals need to pay attention to some important points to ensure proper declaration, deduction and payment of taxes. The table below summarizes basic notes to help make tax management simpler and more transparent.
| Criteria | Note |
| Identify taxable entities | Distinguish between resident and non-resident individuals; apply correct tax calculation, deductions and tax rates. |
| Income classification | Determine income from salaries, wages and other income (business, transfer, investment, prize winnings, etc.); other income is not subject to family deductions. |
| Apply tax rate | Income from wages: progressive tax schedule; other income: fixed tax rate according to type of income (e.g. business 0.5–5%, real estate transfer 2%, lottery winnings 10%, capital investment 5%). |
| Tax declaration and payment | Enterprises declare monthly/quarterly; individuals pay taxes directly if they have income other than salary; comply on time to avoid late payment penalties. |
| Keep records and documents | Contracts, payroll, payment documents, tax declarations; for management, inspection and auditing purposes. |
| Update new policy | Follow the announcement from the tax authorities on family deductions, tax schedules and tax exemptions and reductions to apply correctly in 2025. |
Frequently asked questions about personal income tax 2025
Personal income tax applies to all resident and non-resident individuals with income arising in Vietnam, including income from salaries, business, investment, transfer, winnings and other sources of income as prescribed by law.
Resident individuals are subject to tax on all income generated within and outside Vietnam, while non-resident individuals are subject to tax only on income generated in Vietnam.
Some income such as subsidies, legal allowances, insurance compensation, interest on deposits at credit institutions, remittances, etc. may be exempted or have tax reduced according to the provisions of the Law on Personal Income Tax and guiding documents.
Enterprises must deduct personal income tax at source, declare and pay tax on behalf of employees, and keep complete records and documents to comply with the law and serve future inspections.
Income from salaries and wages (resident individuals): apply progressive tax rates. Other income (business, transfer, investment, winnings, etc.): apply fixed tax rates according to each type of income, for example, business 0.5-5%, real estate transfer 2%, winnings 10%, capital investment 5%. Who is subject to personal income tax?
How do resident and non-resident individuals differ in taxation?
What income is exempt or reduced from tax?
What are the responsibilities of businesses when paying income to employees?
What tax rates apply to salaries, wages and other income?
Personal income tax support tools and consulting services 2025
To properly fulfill personal income tax obligations in 2025 and optimize tax management, individuals and businesses can use support tools and professional consulting services.
Tax declaration and calculation support tools
Electronic tax declaration software helps individuals and businesses to prepare declarations, calculate taxes automatically and pay taxes online. Using this software helps save time and reduce the risk of errors in the declaration process.
The 2025 Personal Income Tax Calculator in Excel format or automatic calculation software supports determining taxable income, applying progressive tax tables and fixed tax rates for each type of income. This is a simple but effective tool, especially when income has many different sources.
The legal regulations lookup tool on the official websites of the General Department of Taxation or the legal information portal helps individuals and businesses promptly update new policies, deduction levels, tax tables and regulations related to personal income tax 2025.
Personal income tax consulting services
Personal income tax consulting services 2025 help individuals and businesses understand legal regulations, apply correct tax rates and minimize risks when declaring and paying taxes. Tax experts support from determining taxable income, calculating tax obligations, to completing year-end settlement documents.
This service is especially necessary for those who have income from multiple sources such as business, investment, transfer or work in multiple places. With professional support, taxpayers will be guided in detail, ensuring compliance with regulations and optimizing legal rights.
At MAN – Master Accountant Network, our team of experienced tax consultants is ready to accompany you in all matters related to personal income tax 2025, from declaration, settlement to consulting on the latest policies in 2025.
Conclude
Personal Income Tax 2025 marks many important changes in personal income management policy, aiming for more fairness and transparency among taxpayer groups. Understanding the new regulations on family deductions, progressive tax schedules and tax calculation for each type of income will help individuals and businesses be more proactive in financial planning.
For individuals, declaring and paying taxes on time not only demonstrates civic duty but also helps avoid unnecessary violations and penalties. Enterprises also need to fully deduct, declare and keep documents to ensure compliance with the law and transparency in income payment activities.
If you need assistance in calculating, declaring or settling personal income tax 2025, please contact MAN – Master Accountant NetworkWith a team of experienced accounting and tax experts, MAN is ready to accompany you to optimize tax obligations, comply with regulations and save maximum time and costs.
Service contact information at MAN – Master Accountant Network
- Address: No. 19A, Street 43, Tan Thuan Ward, Ho Chi Minh City
- Mobile/Zalo: 0903 963 163 – 0903 428 622
- Email: man@man.net.vn
