General Tax Authority just issued a document guiding Personal Income Tax (PIT) finalization in 2011 as decided by a resolution of National Assembly approved by mid year of 2011. Accordingly, the authority will exempt PIT for those who earn averagely below VND 9 million a month in 2011 with taxable income of VND 5 million a month in case of no dependent relative.

 

However, an individual with taxable income averagely below VND 5 million a month (calculated from August 1 – the date when tax exemption is applicable, on) but if his/her whole-year average income is over VND 5 million a month then PIT is normally applied.

 

Previously, experts and enterprise representatives claimed that whole-year average income calculation would not be very meaningful in the face of economic difficulties. It is because that enterprises may pay higher to their employees due to bonus and then the payments are lower for the rest of the year.

 

Under this new direction, payments for lunch not exceeding VND 620,000 a month will not be included in PIT. Under current regulations of Ministry of Labor, Invalids and Social Affairs, such payments are taxable if the amount exceed VND 620,000 a month.

 

Taxable income is calculated at the moment employees receiving their payments. In the event that December 2010 wage is paid on January 2011, such payment is included in taxable income of the year 2011.

 

As guided, the submission of tax finalization will be within 90 days at the latest from the ending date of the year 2011, which is March 31.

According to Binh Duong Newspaper - Translated by Vi Bao