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Personal Income Tax

Household Business with 2026 Revenue Below VND 3 Billion: Which PIT Calculation Method Applies?

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Based on:Nghị định số 68/2026/NĐ-CP, Điều 4 khoản 5; Luật Thuế TNCN số 99/2025/QH15, Điều 10 khoản 1 - Ministry of Finance

This explanation was generated by AI and checked by an automated AI review, not by a human expert. It is not legal, tax or accounting advice and may contain errors. Check the official document before you rely on it.

The Dong Nai Tax Department advised: a household business that has been applying the flat-rate method (tax rate x revenue) since July 2025, with 2025 revenue above VND 3 billion but estimated 2026 revenue below VND 3 billion, must still apply the income-based PIT method (taxable income = revenue minus expenses) in 2026 - it cannot revert to the flat-rate method. Under Decree 68/2026/ND-CP: household businesses with revenue of VND 500 million or above must use the income-based method. Only if a household business self-determines 2026 revenue below VND 500 million may it use the flat-rate method. If actual 2026 year-end revenue reaches VND 3 billion or above, it must switch to the income-based calculation method.

Guidance from Dong Nai Provincial Tax Department

Question

A household business (HB) has been applying the flat-rate PIT method since July 2025. Its 2025 revenue exceeded VND 3 billion; it estimates 2026 revenue will be below VND 3 billion. Can it continue applying the flat-rate method?

  • Decree 68/2026/ND-CP (cited in the official response)
  • Article 4.5 of Decree 68/2026/ND-CP: household businesses with revenue of VND 500 million or above must pay PIT using the income-based method (taxable income x tax rate)

Specific Guidance

1. Flat-rate method (tax rate x revenue): Only available when the HB self-determines 2026 production/business/service revenue to be below VND 500 million

2. Mandatory income-based method: Applies when revenue is VND 500 million or above, per Article 4(a) of Decree 68/2026/ND-CP

3. End of 2026: If the HB determines revenue of VND 3 billion or above, it must switch to the income-based PIT calculation (taxable income x tax rate) as required by Article 10.1 of PIT Law 99/2025/QH15

Procedure: The HB must file and pay PIT in accordance with law and within deadlines specified in Article 10.1 of Law 99/2025/QH15.

Nghị định số 68/2026/NĐ-CP, Điều 4 khoản 5; Luật Thuế TNCN số 99/2025/QH15, Điều 10 khoản 1Effective: July 1, 2025

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