Having received a record-breaking bonus, the Vietnam U23 team is exempt from personal income tax.
Tens of billions of dong in prize money for the Vietnamese U23 players will not be subject to personal income tax, affirmed Ms. Nguyen Thi Hanh, Director of the Personal Income Tax Department, General Department of Taxation.
In response to the question of whether players are required to pay personal income tax at a high rate of up to 35%, Ms. Nguyen Thi Hanh, Head of the Personal Income Tax Department, General Department of Taxation, stated: "Players are entitled to the full amount of their bonuses without having to pay personal income tax, contrary to some recent debates."
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Specifically, Ms. Hanh explained that the "bonus money" that businesses, philanthropists, and organizations gave to the U23 team is a colloquial term used in media reports. According to the Personal Income Tax Law, it is a "gift," which is also a form of income for individuals.
However, the Law, as well as Decree 65 and especially Article 2, Clause 10 of Circular 111 guiding personal income tax, clearly state that individuals will have to pay personal income tax when receiving gifts in four forms: securities, enterprise capital shares, real estate, and types of assets requiring registration of ownership such as cars, motorcycles, yachts, sports guns, etc.
Therefore, bonuses for U23 players are not considered a type of gift within the four gift categories mentioned above, nor are they assets requiring ownership certificates like land titles for houses or vehicle registration certificates, and thus are not subject to tax.
Further investigation reveals that bonuses, such as holiday bonuses, paid by organizations to employees under the Personal Income Tax Law, are still subject to personal income tax. This is considered income from salaries and wages and is taxed according to the current progressive tax rate. The highest tax rate is 35% for average incomes of 80 million VND/month or more, after personal deductions.
However, bonuses from employers, if accompanied by state titles, medals, badges, or certificates of merit, or awards received domestically and internationally, are also exempt from personal income tax.
In other words, even the bonus of over 1.2 billion VND from the Vietnam Football Federation (VFF) for the Vietnam U23 team is not subject to tax.
According to preliminary information, several organizations and individuals have announced monetary rewards for the Vietnam U23 team, including the Vietnam Professional Football Joint Stock Company (VPF) with 1 billion VND, the Ministry of Culture, Sports and Tourism with 2 billion VND, Vietcombank with 1 billion VND; and corporations such as Group, Tuan Chau FLC, Hoa Binh, etc., each awarding 1 billion VND.
