blue-check Increase of family circumstance – based deductions means that PIT is reduced too

Official letter No. 10535/BTC-TCT dated August 31st, 2020 of the Ministry of Finance regarding measures to support enterprises
Posted: 14/9/2020 8:52:36 AM | Latest updated: 15/9/2020 3:59:38 PM (GMT+7) | LuatVietnam: 5043 | Vietlaw: 475


In response to an enterprise’s proposal regarding personal income tax (PIT) should be reduced for the first 6 months of 2020 (due to effects of Covid-19 pandemic), the Ministry of Finance assumes that PIT- liable incomes are deducted family circumstance – based amounts, contributions to compulsory insurance, etc. in which the family circumstance-based deduction for a taxpayer is increased from VND 9 million/month to VND 11 million/month and the family circumstance-based deduction for each dependant of the taxpayer is increased from VND 3.6 million/month to VND 4.4 million/month under Resolution No. 954/2020/UBTVQH14.

Although the aforesaid family circumstance – based deductions are applied from July 1st, 2020, they shall be accounted to the whole income in 2020.

Accordingly, the increase of family circumstance – based deductions under Resolution No. 954/2020/UBTVQH14 may be construed that the State gave PIT deduction to employees.

Regarding value added tax (VAT), the Government has promulgated Decree No. 41/2020/ND-CP regarding VAT deferral therein.

Ms Phuong Thao (
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PublishedVietlaw's Newsletter No. 475
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Read more:

nexto  The Government's measures to support enterprises (7/6/2020) 

nexto  [Draft Resolution] The threshold for paying PIT shall be increased to VND 11 million/month (4/6/2020) status1

nexto  Regarding personal deduction for foreign workers (14/5/2018) 

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