The Vietnamese government has officially announced that starting from July 1, 2026, individuals with a monthly income exceeding 28.6 million VND will be liable to pay personal income tax. This announcement comes with the implementation of Decree 253/2026/ND-CP, which details various provisions and measures to enforce the Personal Income Tax Law of 2025, replacing the previous Decree 65/2013/ND-CP.

One significant change introduced in this decree is the allowance for taxpayers to deduct certain expenses from their taxable income before tax calculations. Specifically, individuals can now deduct expenses related to healthcare and education for themselves and their dependents. For the tax period of 2026, the maximum deductions allowed are 23 million VND for healthcare expenses and 24 million VND for education expenses.

To qualify for these deductions, taxpayers must retain valid invoices and receipts as stipulated by law. The healthcare deductions apply to medical expenses incurred at accredited healthcare facilities, while education deductions cover tuition fees for various educational levels and vocational training.

According to the new tax law, the monthly deduction for taxpayers will be raised to 15.5 million VND (186 million VND annually), while the deduction for each dependent will increase to 6.2 million VND per month. Additionally, the tax brackets for personal income have been simplified from seven to five levels, with the tax rates adjusted accordingly:

• Up to 10 million VND: 5%
• 10 to 30 million VND: 10%
• 30 to 60 million VND: 20%
• 60 to 100 million VND: 30%
• Over 100 million VND: 35%

For instance, an individual earning 28 million VND per month with one dependent will not be required to pay taxes, even after applying all allowable deductions. This means that only those earning above 28.63 million VND monthly will face taxation, starting at a rate of 5%. The Ministry of Finance has confirmed that these regulations will take effect from July 1, 2026, although they will apply to income generated from business activities and wages starting from the 2026 tax period.

Overall, Decree 253/2026/ND-CP aims to provide clearer guidelines for personal income tax obligations while also offering greater financial relief to taxpayers through increased deductions.