Insights

Vietnam Personal Income Tax 2026: The New Five-Bracket Table and What Staff Take Home

By Nguyễn Quốc Trung — Deputy General Director · Updated 2026-09-02

From the 2026 tax period Vietnam's personal income tax runs on a new five-bracket table: 5% up to VND 10 million of monthly taxable income, 10% on 10–30 million, 20% on 30–60 million, 30% on 60–100 million and 35% above 100 million (Law on Personal Income Tax No. 109/2025/QH15). Deductions also rose to VND 15,500,000 a month for the taxpayer and VND 6,200,000 per dependant (Resolution 110/2025/UBTVQH15).

For a foreign company employing people in Vietnam, this changes what your staff take home and how much tax you withhold each month. The sections below give the table, the deductions, the order of calculation, a worked example, and the employer's withholding and finalisation duties.

What is the five-bracket table for the 2026 tax period?

The five-bracket table is the progressive scale applied to an employee's monthly taxable income under the Personal Income Tax Law No. 109/2025/QH15, effective from the 2026 tax period. It replaces the previous scale, and it is progressive — each rate applies only to the slice of income that falls inside its band, not to the whole amount.

• Up to VND 10,000,000: 5%
• Over 10,000,000 to 30,000,000: 10%
• Over 30,000,000 to 60,000,000: 20%
• Over 60,000,000 to 100,000,000: 30%
• Over 100,000,000: 35%

"Monthly taxable income" here is the figure that remains *after* compulsory insurance and personal deductions have been subtracted — not gross salary. That distinction is where most manual calculations go wrong, so the order of steps below matters.

What are the new personal deductions?

The personal (family-circumstance) deductions are the fixed amounts subtracted from income before the tax table is applied, set by Resolution 110/2025/UBTVQH15 for the 2026 tax period:

• VND 15,500,000 per month for the taxpayer
• VND 6,200,000 per month for each registered dependant

A dependant must be registered with the tax authority before the deduction can be claimed. A resident employee with one registered dependant therefore deducts VND 15,500,000 + VND 6,200,000 = VND 21,700,000 a month before tax is calculated, on top of the compulsory insurance already removed. These higher figures lift the point at which tax begins and reduce the tax due at every salary level.

What is the order of calculation, from gross to tax?

Personal income tax is not a flat percentage of gross pay. It is the last step in a sequence, and each step feeds the next:

• Start from gross salary — the total stated in the labour contract.
• Subtract the employee's compulsory insurance of 10.5% (social insurance 8% + health insurance 1.5% + unemployment insurance 1%), calculated on the salary that serves as the contribution base and subject to the statutory caps.
• Subtract the personal deductions — VND 15,500,000 for the taxpayer plus VND 6,200,000 for each registered dependant.
• The result is taxable income. Apply the five progressive brackets to it to get the monthly tax.

Because deductions and insurance come out first, an employee only starts paying tax once income clears the combined shield of insurance plus the VND 15,500,000 personal deduction. Rather than quote a single threshold, the worked example below shows exactly where the line falls for one salary. You can test any figure of your own in the free Vietnam salary calculator, which applies the caps and the 2026 brackets automatically.

How does a gross offer become take-home pay? A worked example

Take a resident employee in Region I, gross salary VND 30,000,000 a month, no dependants, for a pay period from 1 July 2026.

• Gross: VND 30,000,000.
• Compulsory insurance (employee 10.5%): the contribution base is VND 30,000,000, below the social- and health-insurance cap of VND 50,600,000 (Decree 161/2026/NĐ-CP), so 10.5% = VND 3,150,000.
• Income after insurance: 30,000,000 − 3,150,000 = VND 26,850,000.
• Personal deduction: VND 15,500,000 for the taxpayer, no dependants.
• Taxable income: 26,850,000 − 15,500,000 = VND 11,350,000.
• Tax, applied progressively: 5% on the first VND 10,000,000 = 500,000; 10% on the remaining VND 1,350,000 = 135,000; total tax = VND 635,000.
• Take-home pay: 30,000,000 − 3,150,000 − 635,000 = VND 26,215,000.

For the same person, the employer's true total cost is VND 37,050,000 a month — gross plus the statutory add-on (Region I, no dependants, from 1 July 2026). The take-home the employee sees and the total the employer pays are two different numbers, and both matter when you make an offer.

What is tax-free, and what is not?

A few items sit outside taxable income, and one common item that is not deductible often causes confusion.

• Meal allowance: tax-free up to VND 730,000 per month. A cash meal allowance within this ceiling is not added to taxable income; anything above it is.
• Trade-union membership dues (0.5% of the insurance base, capped at VND 253,000 a month, Decision 61/QĐ-TLĐ from 1 July 2025): these are paid only by union members and are NOT deductible for personal income tax. They reduce the cash the employee receives but do not reduce taxable income.

Do not confuse the union dues with the union fee. The 2% trade-union fee (Trade Union Law 2024, No. 50/2024/QH15) is an employer cost, mandatory even where no grassroots union exists, calculated on the same salary base as social insurance. It never touches the employee's payslip and has no bearing on their personal income tax.

What must the employer do — monthly withholding and annual finalisation?

The employer is the withholding agent. Each month, you deduct the calculated personal income tax from the employee's pay and remit it to the tax authority, alongside the compulsory insurance contributions. The employee receives the net figure; you hold and pass on the tax.

After the calendar year closes, the employer runs an annual finalisation for resident employees who authorise it — reconciling the tax withheld across the year against the tax actually due on total annual income and registered deductions, so that any over- or under-withholding is settled. Employees with income from more than one source, or who do not authorise the employer, finalise their own tax directly.

For a foreign company without a Vietnamese entity, both duties — monthly withholding and year-end finalisation — must still be carried out by an in-country employer. This is one of the functions an Employer of Record or a payroll outsourcing arrangement performs: Nhan Kiet signs the employment contract, withholds and remits the tax each month, and files the annual finalisation.

Q&A

Does the new table mean my staff pay more or less tax?
It is charged on taxable income only, not gross. Under the 2026 table the rate is 10% on income over VND 10–30 million and 20% over VND 30–60 million, and the personal deduction is VND 15,500,000 a month plus VND 6,200,000 per registered dependant (Resolution 110/2025/UBTVQH15). The worked example above shows the exact tax for a VND 30,000,000 salary.

Is personal income tax charged on gross salary?
No. It is charged on taxable income — gross minus the employee's 10.5% compulsory insurance minus the personal deductions. Only that remaining amount enters the five-bracket table.

Are trade-union dues deductible from my taxable income?
No. Membership dues of 0.5% (capped at VND 253,000 a month, Decision 61/QĐ-TLĐ) are paid only by union members and are not deductible for personal income tax.

Is the meal allowance taxable?
It is tax-free up to VND 730,000 a month. Any cash meal allowance above that ceiling is added to taxable income.

How do I get an exact figure for a specific salary?
Use the free Vietnam salary calculator, which applies the 2026 brackets, the new deductions and the insurance caps, and shows both the employee's take-home pay and the employer's true total cost. For a quote on a named headcount and salary, call +84 908 636 108 (Nguyen Quoc Trung, Deputy General Director) or email [email protected].

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