Which PIT Progressive Schedule Applies to December 2025 Salary Paid in January 2026: Old 7-Bracket or New 5-Bracket?
The Bac Ninh Provincial Tax Authority answered a question about which progressive tax schedule to apply when a company pays December 2025 salary in January 2026 and files a PIT declaration for January 2026. Under the Personal Income Tax Law No. 109/2025/QH15, provisions relating to employment income for resident individuals apply from the 2026 tax year. The monthly PIT period is determined by the date of payment, not the date the income accrued. Therefore, December 2025 salary paid in January 2026 falls within the January 2026 (i.e., 2026 tax year) period. Conclusion: December 2025 salary paid in January 2026 is subject to the NEW 5-bracket progressive schedule under Law No. 109/2025/QH15, not the old 7-bracket schedule.
Consolidated Document No. 03/VBHN-BTC: Decree Detailing Implementation of the VAT Law
This is Consolidated Document No. 03/VBHN-BTC issued by the Ministry of Finance, merging Decree No. 181/2025/ND-CP (effective from July 1, 2025) with amending Decree No. 359/2025/ND-CP (effective from January 1, 2026) - both of which detail implementation of VAT Law No. 48/2024/QH15. The consolidated text does not replace the two original decrees but lets businesses look up the full current set of VAT rules in one document. The content covers nearly every operational aspect of VAT that SMEs need to know: who counts as a taxpayer (including foreign suppliers selling through digital platforms and e-commerce marketplaces); which goods and services are non-taxable (lightly processed farm produce, land-use-right transfers, banking and securities services, education, books, and more); how to determine the taxable price for different transaction types (sales, imports, asset leasing, real estate, commission agency); when the tax point arises; and the three VAT rates - 0 percent, 5 percent, and 10 percent - with their conditions. The section most relevant to company accountants covers input VAT credit rules: the conditions for using the deduction method (annual revenue of 1 billion VND or more, or voluntary registration), how to allocate input tax when a business sells both taxable and non-taxable goods, and cases where input VAT cannot be credited (assets for national defense and security, assets of credit institutions, insurers, and securities firms, and aircraft or yachts not used for transport or tourism business).
5% VAT Rate on Specialized Machinery and Equipment for Livestock and Poultry Farming
Tax Sub-department No. 15 of Hanoi provides guidance to Gia Linh Manufacturing and Services Co., Ltd. (TIN 0101873635) on applying the 5% VAT rate to specialized machinery and equipment for livestock (pigs) and poultry (chickens, ducks, poultry egg incubation) farming. Pursuant to Clause 6, Article 19 of Decree No. 181/2025/ND-CP dated 01 July 2025 and Clause 3, Article 9 of VAT Law No. 48/2024/QH15, specialized machinery and equipment for agricultural production (including livestock farming) are subject to 5% VAT, effective 01 July 2025. The confirmed list includes: automatic feed and water dispensers, specialized housing structures, waste treatment equipment, ventilation and cooling systems, egg collection equipment, conveyors, and other specialized machinery. The company is permitted to apply 5% VAT when issuing sales invoices for these items, subject to self-assessment of actual production and business operations against applicable regulations.
3-Year CIT Exemption for SMEs: Eligibility When Enterprise Grows Large or Changes Business Type
The Ministry of Finance answered two questions about the 3-year Corporate Income Tax (CIT) exemption for Small and Medium-sized Enterprises (SMEs) under Resolution 198/2025/QH15 and Decree 20/2025/ND-CP. For the first question: if during the 3-year exemption period the enterprise grows beyond SME criteria and becomes a large enterprise, it continues to enjoy the CIT exemption for the remainder of the 3-year period counted from the date of first business registration. The incentive is not terminated when the enterprise outgrows SME thresholds. For the second question: the exclusion from incentives applies only to enterprises newly established through merger, consolidation, division, separation, ownership transfer, or type conversion from enterprises that existed BEFORE Resolution 198 took effect. Enterprises established after NQ198 became effective that subsequently change their business type (e.g., from single-member LLC to multi-member LLC or joint stock company) retain their exemption.
Tax Treatment of Collection-and-Payment-on-Behalf of Foreign Immigration Service Fees by a Law Firm
The tax authority provided guidance to Sophia Law Firm LLC (TIN: 0315746296) on the tax treatment of a scenario where the firm collects US immigration service fees from its clients and remits them to a US-based immigration service company under the EB-3 employment-based immigration program. The collection-and-payment-on-behalf amount is confirmed as excluded from the law firm's taxable revenue if supported by adequate documentation: legal service contract, agency/authorization agreement for collection on behalf, payment receipts, outbound remittance documents, and documents from the foreign immigration company (emails with attached contracts are acceptable even when US companies do not use official seals). Regarding foreign contractor tax (FCT): the immigration service fees remitted to the foreign company are subject to FCT and must be withheld and remitted by the Vietnamese party. For invoicing, the legal service fee portion and the collection-on-behalf portion must be shown separately on the invoice.
CIT Exemption Eligibility for Newly Established SMEs: Where the Largest Capital Contributor Is Already Legal Representative of Another Enterprise
Tax Sub-department 25 of Ho Chi Minh City responded to a query from Ms. Nguyen Thi Loan regarding eligibility for the 3-year CIT exemption for newly established enterprises under Resolution 198/2025/QH15. The authority clarified that the enterprise must qualify as a small and medium enterprise (per Article 5, Decree 80/2021/ND-CP) and must satisfy the conditions in Clause 3, Article 7 of Decree 20/2026/ND-CP. Among the disqualifying conditions: the exemption does not apply if the legal representative, general partner, or highest capital contributor of the new enterprise has held an equivalent role in another enterprise that is currently operating or was dissolved less than 12 months prior. The tax authority did not issue a definitive conclusion for the taxpayer's specific situation, instead instructing Ms. Loan to apply the cited regulations to her own facts to determine eligibility.
Consolidated Document No. 18/VBHN-VPQH: Labor Code (Consolidating Amendments Through 2025)
Consolidated Document No. 18/VBHN-VPQH (Official Gazette No. 131, dated February 28, 2026) consolidates the Labor Code No. 45/2019/QH14 (effective January 1, 2021) with amendments from three laws: Law on Digital Technology Industry No. 71/2025/QH15 (effective January 1, 2026), Population Law No. 113/2025/QH15 (effective July 1, 2026), and Law on Vocational Education No. 124/2025/QH15 (effective January 1, 2026). The Code governs labor standards; rights, obligations, and responsibilities of employees, employers, employee representative organizations, and employer representative organizations; and state management of labor. Its scope of application covers: employees, apprentices, trainees, workers without labor relations, employers, foreign workers in Vietnam, and other agencies/organizations/individuals directly related to labor relations. This is a technical consolidation reflecting the current legal status of the Labor Code. The PDF text is truncated at Article 16 of Chapter III (employment contracts), but the Code comprehensively regulates: employment and recruitment, employment contracts, wages, working hours and rest periods, occupational safety and hygiene, social insurance, resolution of labor disputes, and strikes.
Consolidated Document No. 19/VBHN-VPQH: Social Insurance Law (Consolidating Amendments Through 2025)
This is a consolidated document issued by the National Assembly Office, published in Official Gazette No. 133 on 28 February 2026, merging Social Insurance Law No. 41/2024/QH15 (effective from 1 July 2025) with four subsequent laws that amended parts of it during 2025: the Law on Teachers No. 73/2025/QH15 (effective 1 January 2026), the Law on Inspection No. 84/2025/QH15 (effective 1 July 2025, which removed the social insurance agency's specialized inspection function), the Population Law No. 113/2025/QH15 (effective 1 July 2026), and the Law on Rehabilitation and Bankruptcy No. 142/2025/QH15 (effective 1 March 2026). A consolidated document creates no new rules; it simply compiles all currently effective provisions into one text for easy reference. Coverage includes: who must participate in mandatory social insurance (Vietnamese employees with contracts of one month or more, civil servants, armed forces personnel, registered household business owners, and enterprise/cooperative managers, plus foreign employees on contracts of 12 months or more); contribution rates (employees pay 8% of their salary into the retirement and death-benefit fund; employers pay 3% into the sickness and maternity fund plus 14% into the retirement and death-benefit fund, a combined 17%, while employers of armed forces personnel pay 22%); prohibited acts such as late or evaded payment and document fraud; and specific benefit regimes such as maternity and sickness leave. For business owners and accountants, this consolidated text is the most complete official reference for correctly identifying who must be enrolled in mandatory social insurance (notably, registered household business owners and foreign staff on contracts of 12 months or longer are both covered), calculating the correct contribution rates, and avoiding reliance on provisions that have since been amended or repealed. Late payment or evasion of mandatory social insurance contributions is a prohibited act and can trigger penalties.
Consolidated Document No. 20/VBHN-VPQH: Law on Digital Technology Industry (Consolidating Amendments Through 2025)
Consolidated Document No. 20/VBHN-VPQH, issued by the National Assembly Office on February 12, 2026, combines the Law on Digital Technology Industry (No. 71/2025/QH15, effective January 1, 2026) with amendments made by the Law on Cybersecurity (No. 116/2025/QH15, effective July 1, 2026) and the Law on Artificial Intelligence (No. 134/2025/QH15, effective March 1, 2026). It is Vietnam's first comprehensive legal framework for the digital technology industry, the semiconductor industry, and digital assets. The law sets out a wide range of tax and investment incentives that SMEs, foreign investors, and tech workers should know about. Businesses can claim an increased deduction for digital tech research and development spending when calculating corporate income tax (CIT). Production of key digital products and services, semiconductor chips, artificial intelligence systems, and AI data centers qualifies as a special investment incentive sector, unlocking CIT, land, and customs benefits. Export processing enterprises in the semiconductor supply chain get on-spot import and export procedures and protection against double taxation. Most notably, salaries and wages of high-quality digital tech personnel are exempt from personal income tax for 5 years from the first employment contract, if they work in a concentrated digital technology zone or on key chip or AI projects. The law also establishes Vietnam's first legal framework for digital assets (virtual assets and crypto assets), and automatically converts existing concentrated IT zones into concentrated digital technology zones eligible for incentives equivalent to areas with especially difficult socioeconomic conditions. The financing and investment-incentive provisions (Articles 11, 28, 29) already took effect on July 1, 2025; the rest of the law took effect January 1, 2026.
Decision 288/QD-TTg: Establishment of Hai Phong Special Economic Zone (5,300 ha)
On 12/02/2026, Deputy Prime Minister Tran Hong Ha signed Decision 288/QD-TTg establishing the Hai Phong Special Economic Zone covering 5,300 hectares across 6 communes. The zone includes industrial parks, industrial clusters, a general trade and services area, a free trade zone, logistics service zones, a logistics center, and an innovation center. The goal is to develop high-tech, environmentally friendly industries, targeting 3-4% contribution to Hai Phong's GRDP by 2030 and over 5% after 2030. Development is phased: planning completion (2025-2026), construction and initial operations (2026-2030), and fully integrated infrastructure (2031-2035). The decision takes effect from its signing date (12/02/2026), with the Hai Phong People's Committee responsible for implementation.
Meal Allowances and Overtime Pay Under Product-Based Pay Schemes: PIT Treatment and CIT Deductibility
The Ministry of Finance provided guidance on PIT and CIT treatment for meal allowances and overtime pay where employees are remunerated under a product-based (lump-sum output) pay scheme. From 01/7/2025, meal allowances that do not exceed the limit prescribed by labor law are not counted as taxable PIT income. Reasonable, documented meal allowance payments are deductible for CIT purposes. For overtime pay, the incremental portion of income paid above the normal working day rate is PIT-exempt. Product-based overtime pay is deductible for CIT if supported by full documentation (labor contracts, task assignment decisions, timesheets, payslips, payment vouchers). This guidance is based on Circular 40/2021/TT-BTC and applicable tax regulations effective from 2025.
Machine-Dried Agricultural Products: Are They VAT-Exempt as Minimally Processed Goods?
The Ministry of Finance provided guidance on VAT treatment of agricultural products dried using machinery. Under Article 5, Clause 1 of VAT Law No. 48/2024/QH15 (as amended by Law No. 149/2025/QH15) and Article 4, Clause 1 of Decree 181/2025/ND-CP, agricultural products that have only undergone normal minimal processing - explicitly including sun-drying and machine-drying - are VAT-exempt when sold by the producer. Machine-drying (solely to reduce moisture, with no additives or flavorings) therefore qualifies as normal minimal processing and is VAT-exempt at the production stage. However, Article 9, Clause 2(d) of the VAT Law imposes a 5% rate on the same category of minimally processed agricultural products when they fall outside the VAT-exempt scope of Article 5, Clause 1 (i.e., sold outside the enterprise/cooperative chain). A 10% rate applies to goods and services not covered by Clauses 1 or 2 of Article 9. Where the degree of processing cannot be determined, the Ministry of Agriculture and Environment is responsible for classification.
Decree 54/2026/ND-CP: Amendments to Regulations on Housing and Real Estate Business
Decree 54/2026/ND-CP, dated February 9, 2026, amends a broad set of provisions across four decrees implementing the Housing Law and the Real Estate Business Law (Decrees 96/2024, 95/2024, 98/2024, and 100/2024), plus two Ministry of Construction decentralization decrees (140/2025 and 144/2025). It is a major administrative-procedure reform for the housing and real estate sector, effective from its signing date. On general principles, applications can now be filed in person, online, or by post; many pieces of personal information will be replaced by the personal identification number once the national population database is operational, and results can be issued electronically with the same legal value as paper documents. Several processing deadlines are cut significantly - for example from 15 to 10 days, from 30 to 20 days, or from 15 days down to just 5 working days for condominium renovation and reconstruction procedures. For foreign investors, the decree shortens to 7 days the time the Ministry of National Defense and Ministry of Public Security have to give an opinion on national defense and security zones when a developer wants to sell off-plan housing to foreign organizations or individuals. Office and premises requirements for real estate brokerage firms are simplified in line with enterprise law, and termination or suspension of trading floors and brokerage firms now follows general enterprise-law procedures instead of a separate process. The decree adds a pricing formula (including value-added tax) for state-built resettlement housing sale, lease, and lease-purchase prices, revises the registration process for buying, renting, or lease-purchasing social housing and housing for the armed forces, and reassigns management authority over state-owned housing to match the two-tier local government model. Real estate developers, project owners, trading floors, brokerage firms, and foreign investors should update their internal processes promptly to meet the new deadlines and procedures.
Distinction Between VAT Percentage Rate on Revenue and VAT Tax Rate for Foreign Contractors Under Circular 103/2014/TT-BTC
The Da Nang Tax Authority (Sub-department 3) clarified the distinction between the "percentage rate to calculate VAT on revenue" and the standard VAT tax rate applicable to foreign contractors. Under Circular 103/2014/TT-BTC, the percentage rate is a deemed rate used to calculate VAT payable under the direct method (taxable revenue multiplied by the percentage), which differs from standard VAT rates (0%, 5%, 8%, 10%). Circular 103/2014/TT-BTC remains in force and specifies percentage rates by industry: 5% for services, equipment leasing, and insurance; 3% for construction and installation; 2% for transport, manufacturing, and other activities; 1% for distribution and supply of goods. The authority also referenced Circular 40/2021/TT-BTC for related individual business provisions. The foreign contractor tax calculation method using deemed rates on revenue is separate from the standard VAT rate framework under the VAT Law applicable to Vietnamese parties.
Household Businesses Distributing Animal Feed: VAT-Exempt or 1% Rate?
The Can Tho City Tax Department confirmed that animal feed is VAT-exempt under Article 5, Clause 3 of the VAT Law No. 48/2024/QH15. Household businesses using the declaration method that distribute animal feed are not subject to VAT. However, household businesses must still file VAT declarations as required. Additionally, those with annual revenue exceeding VND 300 million must file and pay personal income tax in accordance with the law.
Converting Pond Land to Residential Use: Is There a Land Use Fee Exemption Under Resolution 254/2025/QH15?
The Ministry of Finance clarified that the land use fee exemption/reduction for converting pond land to residential use under Article 10, Clause 2(c) of Resolution 254/2025/QH15 only applies to pond land situated within the same plot as an existing residential parcel with a house. If the pond plot is a separate parcel and not part of an existing residential lot, the exemption does not apply. Consequently, a family whose pond was allocated in 1955 as a separate parcel (not within the same residential plot) would not qualify for the land use fee exemption when converting that pond to residential use.
E-Invoices from Cash Registers and VAT Rate for Metal Door Knobs (HS Code 259302)
The Dong Nai Tax Department responded to two company questions. First, on cash register e-invoices: a business that primarily serves enterprises under contracts and only occasionally has customers who do not want invoices is not required to use cash register-generated e-invoices. Second, on VAT rate for metal door knobs NEWNEO 5881 (HS-equivalent code 259302 - metal locks and hinges): the tax authority directed the company to check the list of goods not eligible for VAT reduction under Decree 174/2025/ND-CP. If the product is not in Annex 1 or Annex 2 of Decree 174/2025/ND-CP, it qualifies for the reduced 8% VAT rate. Businesses must cross-reference their product code against the annexes of Decree 174/2025/ND-CP and Resolution 43/2018/QH14 to determine the correct applicable rate. If product code 259302 is absent from Annexes 1 and 2, the VAT rate is reduced from 10% to 8%.
Decree 55/2026/ND-CP: Amending and Supplementing Certain Articles of Decree 62 (Official Gazette No. 121/2026)
Decree 55/2026/ND-CP was published in Official Gazette No. 121 dated 25/02/2026. However, the substantive content of the Decree was not extracted from the PDF source - the document only contains page headers (CONG BAO/So 121/Ngay 25-02-2026) for pages 25 through 46 without any actual text body, ending with the signature of Deputy Prime Minister Ho Duc Phoc. The specific amendments introduced by this Decree cannot be determined from the provided source text. The Decree was signed by Deputy Prime Minister Ho Duc Phoc and published in Official Gazette No. 121 dated 25/02/2026.
Decree 57/2026/ND-CP on Restructuring State Capital in Enterprises (Equitization)
On 12 February 2026, the Government issued Decree No. 57/2026/ND-CP setting out detailed rules for restructuring state capital in enterprises, implementing the Law on Management and Investment of State Capital in Enterprises No. 68/2025/QH15. The available content focuses on the equitization process - converting single-member limited liability companies wholly owned by the State (parent companies of economic groups, state corporations, or independent companies) into joint-stock companies. The Decree sets out equitization conditions and forms (keeping the state stake and issuing new shares, selling part or all of the state stake), and defines who may buy shares in the initial offering: domestic investors, foreign investors, and strategic investors. Strategic investors must meet financial-capacity and industry-experience thresholds and give binding commitments, such as keeping the brand and core business for at least 3 years, a 3-year lock-up on purchased shares, and a 20 percent deposit on the registered share value. The Decree also sets standards for valuation consulting firms, the pre-equitization financial process (asset inventory, tax finalization, handling of asset surpluses or shortfalls), tax-deductibility of equitization costs for corporate income tax purposes, and the new joint-stock company's obligation to assume employee rights and obligations. This Decree primarily affects state-owned enterprises slated for equitization, their owner-representative agencies, the auditing, valuation, and consulting firms involved in the process, and domestic or foreign investors seeking to buy shares in state enterprises. Accounting and legal teams at enterprises with state capital should track this to prepare financial records, tax finalizations, and asset disposals on time when their enterprise is designated for equitization. Note: the extracted content is cut off at the asset-method business valuation provisions (Article 29) and does not include the divestment (thoai von) chapter referenced in the document title, nor the effective-date clause.