Do I have to pay tax on savings?

When individuals or organizations deposit money in a bank for a certain period of time to receive profits corresponding to the interest rate offered by that bank, this interest rate is called bank savings interest.

Saving money to earn interest is a method of keeping idle money that many people trust. (Illustration photo)

This is a safe investment channel not only for individuals but also for many businesses. According to regulations, whether or not savings deposits are subject to tax depends on whether the owner of the savings account is an individual or a business. Specifically as follows:

For individuals

Currently, individuals who deposit savings in banks will not be subject to personal income tax. This is regulated under Article 2 of Circular 111/2013/TT-BTC Guiding the Law on Personal Income Tax and Decree 65/2013/ND-CP issued by the Minister of Finance .

The reason is that the State wants to encourage the circulation of money in the market. In addition, this is also an important capital mobilization channel of the economy .

For business

According to Article 7 of Circular 78/2014/TT-BTC amended and supplemented by Article 5 of Circular 96/2015/TT-BTC, interest on bank deposits is considered other income subject to Corporate Income Tax. Specifically:

Other income is taxable income in the tax period that does not belong to the business lines and fields stated in the business registration of the enterprise. Other income includes income from deposit interest, loan interest including late payment interest, installment interest, credit guarantee fees and other fees in the loan contract.

In case the income from interest on deposits and interest on loans is higher than the interest payments on loans as prescribed, after offsetting, the remaining difference is included in other income when determining taxable income.

In case the income from interest on deposits and loans is lower than the interest payments on loans as prescribed, after offsetting, the remaining difference will be deducted from the main production and business income when determining taxable income.

Therefore, if a business has any income from bank interest, it will have to pay corporate income tax. Because this is also considered a source of income for the business.

Duc Thien (synthesis)

Source: https://vtc.vn/gui-tiet-kiem-co-phai-dong-thue-ar813446.html