Not yet reached the tax threshold, do I need to self-settle personal income tax?

In response to this question, the Tax Department said: At Point d.3, Clause 6, Article 8 of Decree No. 126/2020/ND-CP, resident individuals with income from salaries and wages must directly declare and settle personal income tax with the tax authority in the following cases:

Individuals with additional tax payable or overpaid tax may request a refund or offset in the next tax declaration period, except for individuals with additional tax payable after the final settlement of each year of VND 50,000 or less.

Individuals whose tax payable is less than the tax provisionally paid without requesting a tax refund or offset to the next tax return.

Not yet reached the tax threshold, do I need to self-settle personal income tax?

Individuals with income from salaries and wages who sign labor contracts of 3 months or more at a unit, and have irregular income from other places with an average monthly income of no more than 10 million VND in the year and have had personal income tax deducted at a rate of 10%, if not requested, do not have to finalize tax on this income.

Based on the above provisions, in the case where, during the tax year, an individual has salary or wage income at a place that signs a labor contract for 3 months or more, he/she is authorized to authorize the organization that pays the income to settle the tax on his/her behalf without having to directly settle the tax, including the case where the taxable income threshold is reached or not reached.

In the case where, during the tax year, an individual has salary and wage income at a place with a labor contract of 3 months or more, and at the same time has irregular income at other places with an average monthly income of no more than 10 million VND in the year and has had personal income tax deducted at a rate of 10%, if there is no request for tax settlement for this income, he/she can authorize the income-paying organization to settle the tax on his/her behalf without having to directly settle the tax.

This regulation applies to both cases where the place of signing the labor contract for 3 months or more has income that reaches the tax threshold or not yet reached the tax threshold.

In case an individual has 2 or more sources of income in the tax year but the total income in the year does not reach the tax threshold, he/she is not authorized to make final settlement and does not have to make final settlement of personal income tax himself/herself.

However, if this individual has had personal income tax deducted by the organization paying income during the year (i.e. the individual has overpaid tax), if the individual does not request a refund or does not request to offset in the next tax declaration period, he/she does not have to self-declare and finalize personal income tax.

Hieu Nguyen

Source: https://vtcnews.vn/chua-den-nguong-phai-nop-thue-co-can-phai-tu-quyet-toan-thue-thu-nhap-ca-nhan-ar985660.html