VN's small business tax overhaul kicks off with 18,300 voluntary conversions

Contributing sentiments towards policy:

62% : Step 5: Update business registration and tax filing methods, either online or at the tax office.
61% : According to Mai Son, Deputy Director General of the General Department of Taxation (Ministry of Finance), this marks a pivotal reform in tax administration and a significant boost to the private sector.
60% : The Tax Department also rolled out a new user platform for household businesses to practice online declarations before full implementation.
59% : Choose an appropriate calculation method, accounting system, invoicing software, and tax filing tools.
58% : To implement the Ministry of Finance's "Proposal for Transitioning Household Business Taxation," the General Department of Taxation issued directives urging local leaders to coordinate the phase-out of the lump-sum tax and manage the transition.
58% : 60-day push and digital tools Local tax departments launched a "60-day transition campaign" to encourage voluntary compliance.
57% : Step 7: File taxes using the appropriate e-declaration form via eTax Mobile.
56% : More than 18,300 household businesses have voluntarily transitioned to a self-declaration tax model ahead of the official change on January 1, 2026.
56% : New tax calculation methods On December 10, the National Assembly passed the 2025 Law on Personal Income Tax, revising thresholds and procedures for small businesses.
55% : He emphasized that the change enhances transparency and fairness, allowing tax authorities to assess actual business capacity more accurately, while reinforcing the principle of self-reporting, self-payment, and self-responsibility.
54% : Key changes include: Tax-free income threshold raised from 200 million VND to 500 million VND per year (USD 20,600).
54% : For those earning above 500 million VND/year, tax obligations begin: VAT is calculated using a direct percentage on revenue, as per the new VAT Law (No. 48/2024/QH15).
54% : To avoid frequent changes in tax obligations, the chosen calculation method must remain unchanged for two years.
54% : If tax data shows actual revenue exceeds 3 billion VND for two consecutive years, the taxpayer must switch to the net income method.
54% : Transition steps for household businesses Step 1: Review 2025 revenue and project 2026 income to determine tax group.
52% : PIT is calculated based on net income (revenue minus costs), using tiered tax rates: For businesses earning 500 million-3 billion VND/year, taxpayers may choose between two calculation methods: Net income × tax rate Taxable revenue × tax rate, where taxable revenue equals revenue exceeding 500 million VND If a household has multiple business locations or sectors, they may choose where to apply the 500 million VND deduction - but only once, across all operations.
51% : Under the new system, household businesses must declare actual revenue and pay taxes accordingly.
51% : Households below this threshold are exempt from VAT and personal income tax (PIT) but must report actual revenue annually, no later than January 31.
50% : So far, over 18,300 lump-sum tax households have voluntarily switched to the self-declaration method, and more than 3,200 households have upgraded to formal enterprises.
49% : Vietnam is entering a new chapter in tax administration as it abolishes the lump-sum tax regime for household businesses.
47% : Voluntary shift from flat tax Resolution No.
45% : 68-NQ/TW of the Politburo on private sector development sets a clear deadline to eliminate lump-sum taxation by 2026.

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