📢 [HOT UPDATE] – New Tax Management Model for Household & Individual Businesses
Decision 3389/QĐ-BTC (2025) introduces a revenue-threshold tax model to replace the previous “fixed-rate” tax. The new model applies to household and individual businesses from 01/01/2026.
Overview
Under the new framework the tax treatment and compliance requirements are based on annual revenue bands. The objective: transparency, fairness and full digital tax management for household and individual businesses.
Revenue Groups & Key Rules
Group 1 Annual revenue ≤ VND 200 million
- Exempt from VAT and Personal Income Tax (PIT).
- No mandatory bank account or accounting books required.
- Eligible for free accounting software and encouraged to use e-invoices.
Group 2 Annual revenue > VND 200 million and ≤ VND 3 billion
- VAT: pay by the direct method (percentage on revenue) or voluntarily use credit method if eligible.
- PIT: calculated as a percentage of revenue depending on industry.
- Tax filing: quarterly declaration and annual finalization.
- Mandatory separate bank account and use of e-invoices.
- Support: free accounting software and legal advisory assistance.
Group 3 Annual revenue > VND 3 billion
- Mandatory application of the VAT credit method.
- PIT: taxable income × 17%.
- Tax filing: quarterly or monthly (monthly if revenue > VND 50 billion).
- Required: e-invoices, standard SMB accounting books.
- Encouraged to convert to a company entity to access incentives under Resolutions 68 & 198.
Principles of the New Tax Calculation
- Businesses with annual revenue ≤ VND 200 million are exempt from VAT & PIT.
- All taxpayers must file honestly, keep complete records and submit documents on time.
- The model aims for 100% digital tax administration, greater transparency and equitable treatment.
Quick Summary
- Small revenue — tax exemption and simplified procedures.
- Medium revenue — quarterly filing, better access to digital tools and support.
- Large revenue — treated like enterprises, eligible for input VAT credit & refund.
Practical notes & compliance tips
- Check your annualized revenue to determine the applicable group before 01/01/2026.
- Open a dedicated bank account if required for your group to avoid non-compliance.
- Migrate to e-invoicing and consider free/assisted accounting software offered under the policy.
- Consider formal conversion to a company if your revenue grows beyond thresholds to access enterprise incentives.
Legal reference
Decision 3389/QĐ-BTC (2025) — framework establishing the revenue-threshold based model; implementation effective 01/01/2026. Please consult the official text for full legal requirements and transitional provisions.
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