Which types of income will be taxed?

Reply:Taxable personal income includes the following types of income, except for income exempt from tax as stipulated in Article 4 of the Personal Income Tax Law of 2007.

1. Income from business activities, including:

a) Income from the production and sale of goods and services;

b) Income from independent professional activities of individuals holding licenses or professional certificates as prescribed by law.

2. Income from salaries and wages, including:

a) Salaries, wages, and other payments of a similar nature;

b) Allowances and subsidies, excluding those prescribed by law on preferential treatment for meritorious individuals, national defense and security allowances, hazardous and dangerous work allowances for industries, occupations or jobs in workplaces with hazardous or dangerous elements, attraction allowances, regional allowances as prescribed by law, emergency hardship allowances, occupational accident and disease allowances, one-time allowances for childbirth or adoption, allowances due to reduced working capacity, one-time retirement allowances, monthly survivor benefits, severance pay, unemployment benefits as prescribed by the Labor Code, other allowances paid by Social Insurance, and allowances for resolving social evils;

c) Remuneration in various forms;

d) Money received from membership in business associations, boards of directors, supervisory boards, management boards, and other organizations;

d) Other benefits received by the taxpayer, whether in monetary or non-monetary form;

e) Bonuses, excluding bonuses accompanying titles awarded by the State, bonuses accompanying national and international awards, bonuses for technical improvements, inventions, and discoveries recognized by competent state agencies, and bonuses for detecting and reporting violations of the law to competent state agencies.

3. Income from capital investments, including:

a) Interest on loans;

b) Dividends;

c) Income from capital investments in other forms, excluding income from interest on government bonds.

4. Income from capital gains, including:

a) Income from the transfer of capital shares in economic organizations;

b) Income from the transfer of securities;

c) Income from the transfer of capital in other forms.

5. Income from the transfer of real estate, including:

a) Income from the transfer of land use rights and assets attached to the land;

b) Income from the transfer of ownership or use rights of housing;

c) Income from the transfer of land lease rights and water surface lease rights;

d) Other income received from the transfer of real estate.

6. Income from winnings, including:

a) Winning the lottery;

b) Winning prizes in promotional activities;

c) Winnings from gambling or casino games;

d) Winning prizes in games, contests with prizes, and other forms of prize winning.

7. Income from royalties, including:

a) Income from the transfer or licensing of intellectual property objects;

b) Income from technology transfer.

8. Income from franchising.

These are incomes that individuals receive from franchise agreements, including the sub-franchising of franchisees.

9. Income from inheritance in the form of securities, capital shares in economic organizations and businesses, real estate, and other assets requiring registration of ownership or use.

10. Income from receiving gifts
This refers to income received by individuals from organizations and individuals both domestically and internationally, specifically as follows:

- Gifts in the form of securities include: shares, share purchase rights, bonds, treasury bills, fund certificates, and other types of securities as stipulated by the Securities Law; and shares held by individuals in joint-stock companies as stipulated by the Enterprise Law.

- For gifts in the form of capital in economic organizations and business establishments, including: capital in limited liability companies, cooperatives, partnerships, business cooperation contracts, capital in private enterprises, individual businesses, capital in associations and funds permitted to be established according to the law, or the entire business establishment if it is a private enterprise or individual business establishment.

- Regarding gifts of real estate, this includes: land use rights; land use rights with assets attached to the land; ownership rights of houses, including houses under construction; infrastructure and construction works attached to the land, including construction works under construction; land lease rights; water surface lease rights; and other income received from inheritance of real estate in any form (*).

- For gifts of other assets requiring registration of ownership or usage rights with a state management agency, such as: automobiles; motorcycles; ships, including barges, canoes, tugboats, push boats; boats, including yachts; aircraft; hunting guns, sporting guns.

(*) Taxable income from inheritance and gifts does not include the following tax-exempt income:

Income from inheritance or gifts of real estate (including houses and future construction projects as stipulated by the law on real estate business) between: husband and wife; biological parents and biological children; adoptive parents and adopted children; father-in-law and mother-in-law and daughter-in-law; father-in-law and mother-in-law and son-in-law; paternal grandparents and grandchildren; maternal grandparents and grandchildren; and siblings.