Tax Obligations for Individuals – Household Businesses – Small Enterprises

(Updated regulations effective from June 2025)

Comparison Table of Tax Obligations

Applicable in the case of real estate rental by individuals, household businesses, and small enterprises
(Criteria based on Article 5, Decree 80/2021/ND-CP on classification of small enterprises).

No.	Criteria	Individual	Household Business	Small Enterprise
1	Business Registration	Not required	Required	Required
2	VAT	5% if revenue > VND 100M/year (VND 200M from Jan 1, 2026)	5% if revenue > VND 100M/year (VND 200M from Jan 1, 2026)	10% (deductible method) Input VAT can be deducted if eligible
3	Personal / Corporate Income Tax	5% PIT if revenue > VND 100M/year	2% PIT if revenue > VND 100M/year	20% CIT on net profit (Exempt for first 3 years under Resolution 68)
4	License Fee	Applicable if revenue > VND 100M/year	Applicable if revenue > VND 100M/year	Based on charter capital
5	Tax Calculation Method	Per contract	Flat-rate or annual revenue declaration	Based on accounting records
6	Expense Deductibility	Not allowed	Limited	Allowed (if documents are valid)
7	Legal Recognition & Reputation	Low	Medium	High
8	Accounting Procedures	Simple	Moderate	Complex (requires accountant)
9	Suitable Business Model	Small-scale rental	Multiple property rental	Large-scale operations

📌 Tax Exemption Note

According to Clause 2, Article 4 of Circular 40/2021/TT-BTC: Individuals and household businesses with total annual revenue ≤ VND 100 million
are exempt from VAT and PIT. However, they must still declare tax accurately and on time, and bear responsibility for the accuracy of their declarations.

🔍 Example: Annual Revenue of VND 600 million

Entity Type	Revenue (million VND)	Taxes	Total Tax Payable
Individual	600	VAT: 5% = 30 PIT: 5% = 30 License fee: 0.5	60.5 million
Household Business	600	VAT: 5% = 30 PIT: 2% = 12 License fee: 1	43 million
Small Enterprise	600	VAT: 10% = 60 (deductible) CIT: 20% of profit (e.g. profit = 50 => CIT = 10) License fee: 2	72 million (Subject to change depending on input VAT and actual profit)

Note: When considering a business’s tax number, it is necessary to clearly plan the related costs to be able to visualize the most accurate tax number.

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