DEDUCTIONS WHEN CALCULATING TAXABLE INCOME FROM WAGES, REMUNERATIONS.


Source: finexhr.com

Personal income tax is: The amount is required to pay a portion of your salary or from other sources of income to the state budget. At the same time, depending on the nature of the personal income, income is divided into two categories: regular income and irregular income.

Income from salaries and wages is one of the regular income of the individual and to taxable. However, the state also minds of the standard of living and the needs, goals essential to make deductions when calculating PIT.

1) Personal deduction:
Personal deduction is the amount of money deducted from the taxable income before calculating tax on incomes from wages earned by the resident taxpayer.

Deduction for the taxpayer: 9 million VND/month, 108 million VND/year.

Deduction for each dependant: 3.6 million VND/month.

Dependants include:

- Children, legitimate adopted children, illegitimate children, stepchildren, in particula: Children under 18 years of age; Children from 18 years of age and over that are disabled and incapable of work; Children studying in Vietnam or overseas in universities, college, vocational schools, including children from 18 years of age and over in high schools (including the period awaiting university enrolment result from June to September in 12th grade) that have no income or the average monthly income in the year from all sources ≤ 1,000,000 VND..

- Other dependants that the taxpayer has to provide for; The taxpayer’s parents, parents-in-law, stepparents, legitimate adoptive parents that meet the conditions in Point dd Clause 1 of  Article 9 Circular 111/2013/TT-BTC.

2) Deductions for insurance premiums and contributions to the voluntary pension fund

Insurance premiums include premiums for social insurance, health insurance, unemployment insurance and professional liability insurance, which is compulsory for some professions.

3) Deductible charitable donations

The charitable donations shall be deducted from the taxable income from wages before calculating the tax incurred by a resident taxpayer, in particular.

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