Global mobility services

Clarity on taxation of visa costs for assignees in Vietnam

On 18 May 2020, the General Department of Taxation issued Official Letter No. 2014/TCT-DNNCN to answer the European Chamber of Commerce in Vietnam (EUROCHAM) on the personal income tax (PIT) policy for the costs of obtaining temporary residence cards and visas for employees.


What this mean for employees in Vietnam:

  • where employers pay the expenses for applying and extending temporary residence cards and visas for foreign workers in order for them to be eligible to work at organisations in Vietnam and this is the responsibility of employers, these expenses are not included in the taxable income from salaries and wages of the employees.
  • in cases where the visa application fee for employees working in organisations in Vietnam is to go on overseas business trips as required by the work is per diem in accordance with the organisation financial regulations or internal regulations, it shall not be included in PIT taxable income. The expenses in excess of the prescribed threshold shall be taken into taxable income for PIT calculation purpose.
  • Finally, if the expense for temporary residence cards or visa applications is paid by the employers on behalf of the foreign workers are the employee's benefits, these expenses shall be included in the taxable income from salaries and wages of the foreign employees.

This Official Letter, General Department of Taxation has clarified further the PIT treatment on expenses for temporary residence cards and visas application for foreign workers paid by the company on behalf of employees compared to several previous guidance (as in Official Letter No. 3867/TCT-TNCN on 25 August 2017 issued by the General Department of Taxation).

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