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blue-check Issues relating to PIT on probationary income

Dispatch No. 3611/CT-TTHT dated April 16th, 2019 of the Tax Department of Ho Chi Minh city regarding personal income tax
Posted: 9/8/2019 8:52:55 AM | Latest updated: 28/10/2022 9:38:04 AM (GMT+7) | LuatVietnam: 4777 | Vietlaw: 583
VietlawOnline

According to the regulations at point b, point i clause 1 Article 25 of Circular No. 111/2013/TT-BTCstatus2 , only individuals who sign labor contracts for 03 months or longer are entitled to tax calculation according to the progressive tax table. Those who do not have or have labor contracts for less than 03 months shall be subject to 10% tax.

Accordingly, in case a company signs a probationary employment contract before signing an official contract with an employee, the probationary income shall be subject to 10% tax. After the official contract is signed, the salary shall be calculated according to the progressive taxation table.

Applicable regulations of laws do not regulate re-calculation of PIT according to the progressive taxation table for probationary period of the person after he/she signs the official contract.

Regarding PIT finalization, if the employee is eligible to authorize the Company to make PIT finalization on his/her behalf, the Company shall declare all incomes paid to the employee in the Chart No. 05-1BK-QTT-TNCN.

In contrast, if the employee is not eligible to authorize the Company to make PIT finalization on his/her behalf or he/she has quit before the date of PIT finalization, the Company shall declare incomes already withheld according to the progressive taxation table in the Chart No. 05-1BK-QTT-TNCN, incomes already withheld at the 10% rate in the Chart No. 05-2BK-QTT-TNCN and issue documents evidencing PIT withholding so that these employees can carry out the PIT finalization procedures at their discretion.

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Published Vietlaw's Newsletter No. 583

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enflag pdficon CV3611-16042019CTHCM[EN].pdf

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Lương thử việcCập nhật đến: 8-Jan-2020

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