Labour Regulations Update in May 2024

I. Official letter No. 1806/TCT-DNNCN on intensifying management of personal income tax (PIT) on incomes from stock dividends and bonus shares of existing shareholders.

On 2 May 2024, the General Department of Taxation issued the Official Letter No. 1806/TCT-DNNCN on intensifying management of personal income tax (PIT) on incomes from stock dividends and bonus shares of existing shareholders.

The contents mentioned in this Official Letter are as follows:

Information dissemination, provision of support and instructions for taxpayers:

• Disseminate to the relevant individuals and organizations about their responsibility to declare and pay PIT on income from capital investment when transferring shares of the same type.
• Provide guidance documents regarding declaring and paying PIT for individuals and organizations.

Supervision of organizations’ declaration and payment of PIT on behalf of taxpayers:

• Review and expedite these organizations to fulfill their obligation to declare and pay PIT on behalf of individuals.

Inspection tasks:

• Check tax dossiers at the Tax agency headquarters and taxpayer headquarters.
• Detect and handle violations in tax declaration and PIT payment.

Reporting:

• Periodically report to the General Department of Taxation on the status of declaring and PIT for individuals no later than the 5th of every
• month and ad hoc reports when required.
• Coordinate with other Tax Departments when necessary.

II. Official letter NO. 1982/TCT-DNNCN regarding guidance on personal income tax policy

On 10 May 2024, the General Department of Taxation issued the Official Letter No. 1982/TCT- DNNCN guiding personal income tax policies on annual vacation expenses for employees who are qualified for reward.

According to the instruction in this Official Letter:

In case a vacation expenses are paid by the Company to an employee and the name of the individual beneficiary is clearly stated, this amount shall be treated as taxable income. Otherwise, the name of the individual beneficiary is the collective of employees, this amount shall be treated as non-taxable income.

III. Official letter NO. 26443/CTHN-TTHT on Tax policy for employee’s benefits

On 7 May 2024, the Hanoi Tax Department issued the Official Letter No. 26443/CTHN-TTHT guiding personal income tax (PIT) employee’s benefits.

According to the instruction in this Official Letter:

• In case the Company has a policy on issuing parking passes to employees (free or discounted) and the conditions and benefit levels are clearly stated in one of the following documents: Labor Contract; Collective Labor Agreement; Financial regulations of Company, Corporation; Bonus regulations are prescribed by the Chairman of the Board of Directors, General Director, Director according to the financial regulations of the Company. If this level of expenditure is consistent with the income subject to corporation income tax, this amount is not treated as taxable income.
• In case the above expenditure level is higher than the current regulations, the excess amount must be included as income subject to PIT.

IV. Decision NO. 406/QD-SLDTBXH on authorizing the people’s committee of districts, towns to handle procedures related to the issuance of work permits to foreigners

On 6 May 2024, the Ha Noi Department of Labor, War Invalids and Social Affairs (DOLISA) issued the Decision No. 406/QD-SLDTBXH on authorizing the People’s Committees of Districts, Towns to handle procedures related to the issuance of work permits to foreigners under the jurisdiction of the Department of Labor, War Invalids and Social Affairs.

Accordingly, the Hanoi DOLISA authorized the People’s Committees of Districts and Towns in Hanoi city to handle 03 administrative procedures related to the issuance of work permits for foreign employees working in Ha Noi city. It is under the jurisdiction of the Department of Labor, War Invalids and Social Affairs (including employees working for Enterprises operating in Hanoi’s Industrial and Export Processing Zones and Enterprises operating in Hoa Lac Hi-Tech Park), including:

• Confirm employees are not subject to work permit issuance in case they get married to Vietnamese and live in the territory of Vietnam;
• Re-issue work permits to foreign employees working in Hanoi city;
• Extend work permits for foreign employees working in Hanoi city.

Authorization period: From 1 June 2024 to 31 December 2024.

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