KEY HIGHLIGHTS OF THE PERSONAL INCOME TAX LAW 2025: NEW PROGRESSIVE TAX TARIFF AND REGULATIONS FOR HOUSEHOLD BUSINESSES, AND TAXATION OF DIGITAL ASSETS

On 10 December 2025, the National Assembly officially passed the Personal Income Tax Law 2025, replacing the Personal Income Tax Law of 2007. The new Law consists of 4 Chapters and 30 Articles and is considered the most comprehensive overhaul of Vietnam’s personal income tax policy in the past decade, with far-reaching impacts on household businesses, salaried employees, and investors. Below is a detailed overview of the key new regulations to be implemented under the Law.

1. Comprehensive Reform of the Progressive Tax Schedule (Income from salaries and wages)

The Personal Income Tax Law 2025 introduces significant adjustments to the progressive tax schedule with the aim of reducing the tax burden on employees and ensuring greater fairness across income levels. Key changes include:

• Reduction in the number of tax brackets: from 7 brackets to 5 brackets.
• Maximum tax rate: maintained at 35%, applicable only to the portion of monthly taxable income exceeding VND 100 million.

New progressive tax schedule (comparison with the current regulations):

2. New Regulations for Household and Individual Businesses

The Personal Income Tax Law 2025 introduces a more detailed classification of household businesses and fundamentally revises the tax calculation methods, with a strong focus on easing the burden for small- and medium-scale businesses.

• Increase in the revenue threshold subject to tax and VAT exemption

• Household businesses with annual revenue of VND 500 million or less are NOT subject to Personal Income Tax or VAT.
• The VND 500 million threshold may be deducted from revenue before calculating personal income tax based on revenue ratios.

• Tax calculation methods based on revenue scale

A new tax calculation method based on income (Revenue – Expenses) is introduced to enhance fairness, as follows:

• Group 1 (Annual revenue over VND 500 million to VND 3 billion): Subject to 15% tax on income, similar to the corporate income tax rate applied to small enterprises. Household and individual businesses may choose between taxation based on revenue ratios or taxation based on income
• Group 2 (Annual revenue over VND 3 billion to VND 50 billion): Mandatory taxation based on income, with a 17% tax rate
• Group 3 (Annual revenue exceeding VND 50 billion): Mandatory taxation based on income, with a 20% tax rate.

For real estate leasing activities (excluding accommodation services) with annual revenue exceeding VND 500 million, only the revenue-based taxation method applies. In such cases, individuals are not required to determine expenses, offset income from multiple properties, or conduct annual tax finalization.

3. Taxation of Capital Investment, Capital Transfers, and Securities

The Law clarifies tax treatment for various forms of financial investment, including:

• Securities transfers: Tax calculation method remains unchanged at 0.1% of the transfer price per transaction.
• Capital transfers: Tax rate of 20% on taxable income (Selling price – Purchase price – Related expenses). Where purchase price or expenses cannot be determined, a 2% tax rate on the transfer price applies.
• Capital investment income (dividends and profit distributions): Subject to a 5% tax rate per occurrence.

4. Introduction of New Taxable Assets: Digital Assets and Gold Bullion

For the first time, the Personal Income Tax Law 2025 formally introduces taxation on certain special assets in line with market developments:

• Digital assets: Income from the transfer of digital assets is subject to a 0.1% tax rate on the transfer price.
• Gold bullion: Subject to a 0.1% tax rate on the transfer price per transaction. Note: The Government will issue detailed regulations on taxable thresholds and implementation roadmaps in line with gold market management requirements.

5. Effective Date

• The Personal Income Tax Law 2025 takes effect from 01 July 2026.
• Provisions relating to business income and income from salaries and wages of resident individuals will apply from the 2026 tax period.

Contact Information

Mr. Nguyen Bao Anh
Deputy General Director in charge of Tax, Transfer Pricing & Outsourcing Services
Email: anh.nb@a-c.com.vn

Ms. Nguyen Thi Thu Thao
Senior Manager – Tax and Accounting Services
Email: thao.ntt@a-c.com.vn