Important changes in Business Household Tax management according to Decree 68/2026/ND-CP

On March 5, 2026, the Government issued Decree 68/2026/ND-CP (effective immediately), marking a transition from “presumed” tax management to “digitized” and “actually collected” tax management. This is the most important legal document that directly affects more than 5 million business households in Vietnam.

IMPORTANT NEW POINTS

• Tax-free revenue threshold: Raised from 100 million to 500 million VND/year. Businesses with revenue below this level only need to register and do not have to pay VAT and personal income tax.

 • Declare tax based on actual profits: For the first time, businesses have the option to pay personal income tax at 15% on profits (after deducting valid expenses) instead of paying as a percentage of revenue.

• End “Tax Bargaining”: Roadmap to completely abolish Presumptive Tax by the end of 2026. All revenue fluctuations must be updated via electronic invoices created from the cash register.

• Tighten e-commerce: Platforms (Shopee, TikTok…) are required to deduct tax at source. Cash flow data is directly linked to tax authorities.

LEGAL RISKS & WARNINGS

1. Risk of “Cost Trap”: If you choose the profit-based tax payment method but do not have a legal input invoice, the actual tax payable may be 2-3 times higher than the old method.

 2. Risk of Collection from Personal Accounts: Tax authorities have the right to retrieve bank data for comparison. Any money entering an account that cannot be proven to have a non-business origin will be defaulted as taxable revenue.

3. Criminalization Risk: Failure to issue invoices or using illegal invoices to optimize costs can lead to charges of tax evasion under the Criminal Code if the amount of violation is large.

RECOMMENDED

To ensure compliance and optimize benefits, business households need to immediately:

• Review the accounting system: Convert to using electronic invoices and simple accounting software for HKD.

• Standardize cash flow: Use separate bank accounts for business activities.

• Re-evaluate the model: Consider converting to Enterprise if the revenue scale exceeds the threshold of 3 billion VND to enjoy better corporate income tax incentives.

This bulletin is for general information only and is not a guide for any specific situation. If you need assistance, please contact us.