Guidance on personal income tax (PIT) Finalization in 2016 and the issuance of dependent’s tax code




In aim to guide PIT finalization in 2016, Hanoi Tax Department promulgated two official dispatches No. 5286/CT-TNCN dated  February 16th 2017 and No. 6046/CT-TNCN dated February 21st 2017. Whereby: The cases on duty of PIT finalization in 2016:

- Organizations paying income from wages and salaries  are responsible for declaring PIT finalization and finalize PIT on the behalf of  authorized employees regardless of whether tax deduction arises or not. In case an organization or an individual doesn’t incur income payment, It/ he doesn’t have to declare PIT finalization.

- Individuals arising income from wages, salaries directly finalize their personal income tax with tax authority: Residents arising income from wages, salaries are responsible for declaring PIT finalization  if there are additional payable tax amounts or overpaid amounts requested for refunding or offsetting in the following tax calculation period.

The cases on authorizing PIT finalization in 2016, some remarkable points as follow:

- Individual arising income from wages, salaries signed at least 3 month labor contract at an income payment organization and is actually working there at the PIT finalization authorization point of time, including those working incompletely 12 months in the year, as well as arising current income in other organizations with monthly average income of not exceeding 10 million dong ,withheld 10% of monthly income by those organizations without any request for finalization in relation to these income. If individuals have any request for finalization in relation to current income, they directly finalize with tax authority.

- In term of family deduction, the guidance stipulates that dependents who have registered and have complete documentation to prove dependents as defined in point G clause 1 article 9 of the Circular No. 111/2013/TT-BTC are allowed calculating family deduction in 2016, including dependents who haven’t been granted tax code by appropriate authority.

In relation to dependent’s tax code issuance: if there are any changes related to tax code issuance ( including personal identification and information on birth certificate),  income payment organizations gather sample 20/DK-TCT (the Circular No. 95/2016/TT-BTC dated 28/06/2016 by Ministry of Finance) from individuals, then submit them to direct management authority (the tax authority update each dependent’s changed information on TMS application).