At a glancePersonal Income Tax (PIT)Confirmation from the Ministry of Finance for the deduction of the hypothetical tax
and the housing norm for the expatriate employee working in Vietnam.

Personal Income Tax

Official Letter No. 12495/BTC-TCT on Personal Income Tax (PIT) treatment for the
hypothetical tax and the housing norm for the expatriate employees
working in Vietnam.

Official Letter No. 12495/BTC-TCT on PIT
treatment for the hypothetical tax and the housing norm for the
expatriate employees working in Vietnam.

On 6 September 2014, The
Ministry of Finance (MoF) published Official Letter (OL) No.
12495/BTC-TCT to provide guideline on the treatment for the hypothetical
tax and housing norm for the expatriate employee in Vietnam.

In accordance with this OL, in case the employee is subject to tax
equalization and housing norm policy while on Vietnam assignment, the
hypothetical tax and housing norm are allowed to be deducted from income
before grossing up when calculating Vietnam tax. At the time of
reconciliation of the hypothetical tax withheld during the year, if
there is an amount due to/due from the employee, such amount is added
to/deducted from the income of the month of such reconciliation. There
are also the examples in the OL illustrated for the calculation methods.

Please click here for more information and here for Vietnamese version.