How to calculate personal income tax in Vietnam 2025

Personal income tax is an amount of money that must be deducted and paid from part of the salary and other revenue sources of income generators paid to the tax agency for remittance into the state budget after it has been deducted. Personal income tax payment is the fact that an individual must deduct a salary or another income to be remitted into the state budget. In which, personal income tax is a direct tax, levied on some high-income individuals and this taxable rate will be clearly regulated by law. Here, Viet An tax agent will provide you with the latest updated personal income tax calculation method in 2025.

Personal income tax payable salary

Thus, according to the above regulations, employees with a salary of over 11 million VND/month or over 132 million VND/year (after deducting all exempted or reduced amounts such as social insurance, health insurance,…, etc.) must be obliged to pay personal income tax

In case the employee has dependents: must have a salary of over 15.4 million VND/month if there is 01 dependent; over 19.8 million VND/month if there are 02 dependents,…

How to calculate personal income tax in 2025 for income from salaries and wages

The method of calculating personal income tax in 2025 for income from salaries and wages is as follows:

How to calculate personal income tax in 2025 for resident individuals

• Resident individuals who are employees who do not sign or have labor contracts of less than 03 months
  • Pursuant to Point I, Clause 1, Article 25 of Circular 111/2013/TT-BTC, organizations and individuals that pay wages, remuneration and other expenses to resident individuals who have not signed labor contracts or have signed labor contracts for less than 03 months with a total income payment of two million VND/time or more must deduct tax at the rate of 10% of their income before paid to individuals
  • In case an individual has only one income subject to tax deduction at the above rate but the estimated total taxable income of the individual after deducting family circumstances is not enough to pay tax, the income earner shall make a commitment to send it to the income-paying organization for the income-paying organization to serve as a basis for temporarily not yet deducting tax personal income
  • Accordingly, if an employee does not sign a labor contract or signs a labor contract for less than 03 months but earns income from salary and wages each time receiving VND 2,000,000 million or more, he or she must pay tax at the rate of 10%, except for cases where the total taxable income after deducting family circumstances is not enough to pay tax. The specific calculation method is as follows: “PIT payable = 10% x Total income before payment”
• Resident individuals are employees who sign labor contracts for 03 months or more:
  • According to Article 7 of Circular 111/2013/TT-BTC, personal income tax for resident individuals who are employees who sign labor contracts for 03 months or more is calculated according to the following formula:

“Payable PIT = Taxable income x Tax rate”

• • In which: Taxable income = Taxable income – Deductible amounts. Taxable income is the total income from salaries, wages or other incomes: deductions for family circumstances, insurance premiums, voluntary pension funds, charitable, humanitarian contributions, study encouragement.
  • Tax rates are applied according to the Partial Progressive Tariff, specifically:

How to calculate personal income tax in 2025 for non-resident individuals

Personal income tax in 2025 for non-resident individuals is calculated based on the formula as prescribed in Article 18 of Circular 11/2013/TT-BTC as follows:

“Payable PIT = Taxable income x Tax rate of 20%”

In particular, taxable income from salaries and wages of non-resident individuals is determined by the total amount of salaries, wages, remuneration and other incomes of the nature of salaries and wages received by taxpayers in the tax period minus tax-exempt amounts.

The determination of personal income taxable income from salaries and wages in Vietnam in case an individual does not reside and works in Vietnam and abroad at the same time but cannot separate the income generated in Vietnam shall be carried out according to the following formula:

• Case 1: Foreigners who are not present in Vietnam

The formula for calculating personal income taxable income from salaries and wages for foreigners who are not present in Vietnam is calculated as follows:

• Case 2: Foreigners present in Vietnam. The calculation formula is as follows:

Other taxable incomes (before tax) arising in Vietnam mentioned above are other benefits in cash or non-cash that employees are entitled to in addition to salaries and wages paid by employers or paid on behalf of employees.

If you have any difficulties or questions related to how to calculate personal income tax in 2025, please contact Viet An Tax Agent for the most specific advice.