NEW TAX RATES APPLIED TO BUSINESS HOUSEHOLDS IN 2022

Create at: 15/02/2022 15:37

💢 Business-license tax

🔆 Pursuant to Decree No. 139/2016/ND-CP, Decree No. 22/2020/ND-CP, and Circular No. 65/2020/TT-BTC, the license fee rate for business households is calculated based on: by average annual revenue. As follows:

▪️ Individuals, groups of individuals, and households engaged in production and business activities with an annual turnover of VND 100 million or less will be exempt from license tax.

▪️ Individuals, groups of individuals, and households engaged in production and business activities with an annual turnover of VND 100 million or more will have the following license tax rates:

Revenue	License tax to be paid
From 100 million VND to 300 million VND/year	300,000 VND/year
From 300 million VND to 500 million VND/year	500,000 VND/year
Over 500 million VND/year	1,000,000 VND/year

The following cases will be exempt from license tax:

⏺️ Individuals, groups of individuals, and households engaged in irregular production and business activities; do not have a fixed location according to the guidance of the Ministry of Finance.

⏺️ Individuals, groups of individuals, and households produce salt.

⏺️ Organizations, individuals, groups of individuals, households farming, fishing, seafood, and fishery logistics services.

⏺️ Commune cultural post office; press agencies (print press, audio press, video press, electronic press).

⏺️ Branches, representative offices, and business locations of cooperatives provide technical services directly in service of agricultural production.

⏺️ Commune People's Credit Fund; cooperatives specializing in providing services for agricultural production; branches, representative offices, business locations of cooperatives and of private enterprises doing business in mountainous areas. Mountainous areas are determined according to the regulations of the Committee for Ethnic Minorities.

💢 Value-added tax (VAT) and personal income tax (PIT):

Tax formula:

VAT payable amount = Taxable turnover x VAT rate

PIT payable amount = PIT taxable turnover x PIT rate

In which, taxable revenue is determined as follows:

▪️ Revenue subject to VAT and revenue subject to PIT is the tax-inclusive revenue (in the case of taxable) of all sales, processing fees, commissions, and service provider fees incurred in the tax accounting period from the production and trading of goods and services.

▪️ In case flat taxpayers use invoices of tax authorities, the taxable revenue is based on the flat revenue and the revenue on the invoice.

▪️ In case of business individuals cannot determine flat taxable revenue or determine that it is not realistic, the tax authority is competent to determine flat taxable revenue according to the provisions of the law on tax administration.

List of occupations for calculating VAT and PIT:

Number	List of occupations	% VAT calculation rate	PIT rate
1	Distribution and supply of goods: Wholesale and retail activities of all kinds of goods (except for the value of goods sold by agents at the right price to enjoy commission).	1%	0.5%
2	Services, construction excluding raw materials: - Accommodation services include: Provision of short-term accommodation facilities for tourists and other visitors; the activity of providing long-term accommodation for students, workers...; activities that provide accommodation, foodservice, and/or recreational facilities. Accommodation activities do not include: Activities of providing long-term accommodation facilities that are considered permanent establishments such as monthly or annual apartment rentals are classified in the real estate industry according to the provisions of the law on the economic system of Vietnam. -Loading and unloading services and other supporting services related to transportation such as yard business, ticketing, vehicle maintenance. -Postal services, delivery of letters and parcels. -Brokerage services, auctions, and agency commissions. -Legal consulting services, financial consulting, accounting, auditing; tax and customs administrative services. -Data processing services, portal rental, information technology, and telecommunications equipment. -Office support services and other business support services. Services of sauna, massage, karaoke, discotheque, billiards, internet, games. -Tailoring and laundry services; Haircut, hair wash. -Other repair services include: repair of computers and household appliances. -Consulting services, design, supervision of basic construction. -Other services. -Construction and installation do not include bidding for materials (including installation of industrial machinery and equipment).	5%	2%
	The rental property includes: Rental of houses, land, shops, factories, warehouses, except accommodation services. Leasing means of transport, machinery, and equipment without an operator. Lease other property without service.	5%	5%
	Acting as a lottery agent, insurance agent, multi-level sales	-	5%
3	Production, transportation, services associated with goods, construction including raw materials: -Producing, processing goods. -Mining and processing of minerals. - Transport of goods, transport of passengers. -Services associated with the sale of goods such as training, maintenance, technology transfer, and product sales. -Food Service. -Repair and maintenance services for machinery, equipment, means of transport, cars, motorbikes, and other motor vehicles. -Construction, installation including raw materials (including installation of industrial machinery and equipment).	3%	1.5%
4	Other business activities: The production of products is subject to VAT calculation by the credit method with a VAT rate of 5%. The provision of services is subject to VAT calculation by the credit method with a VAT rate of 5%. Other activities are not listed in groups 1, 2, 3 above. 2% 1%	2%	1%
4	Other services are not subject to VAT.	-	1%