05 KEY CHANGES PERSONAL INCOME TAX 2026

Vietnam’s Personal Income Tax (PIT) policy for 2026 introduces significant updates under the 2025 Personal Income Tax Law, applicable from the 2026 tax year.
1. Increased Family Circumstance Deduction (Effective 01 January 2026)

• Personal relief: VND 15.5 million/month (VND 186 million/year).
• Dependent relief: VND 6.2 million/month.

This represents an increase of over 40% compared to 2025.
2. Application for a 5-Tier Progressive Tax Schedule
Employment income is subject to a 5-tier progressive tax structure:

Compared to 2025, the number of tax brackets is reduced from seven to five with adjusted thresholds.

3. Simplified Dependent Registration Procedure

From 14 February 2026, the registration of dependents for family circumstance relief applicable to individuals earning income from salaries and wages will be carried out together with the initial tax registration procedure, instead of requiring a separate filing.

4. Tax Finalization at the Location of Highest Income

Resident individuals earning income from multiple employers must finalize PIT with the tax authority managing the highest total income source in the year.

• If multiple highest income sources are equal, the taxpayer may choose the filing authority.
• Incorrect submissions will be administratively transferred to the competent tax authority.

What Should Businesses Prepare?

• These regulatory updates may directly impact salary structures, payroll systems, and annual tax finalization processes starting in 2026.
• For a comprehensive review of payroll systems and PIT compliance or consultancy on new regulatory changes, our advisory teams are ready to support.

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