From 2026, regulators will officially abolish the lump-sum tax payment method for business households, transitioning to tax declaration and payment based on actual revenue. At a seminar on the transformation for business households organized by the Journal of Managers on 10/12, Le Thi Duyen Hai, Deputy General Secretary of the Tax Consulting Association, stated that the tax calculation methods for lump-sum and declaration-based households are not fundamentally different.

"The only difference lies in revenue, where lump-sum households use estimated stable revenue from the beginning of the year, while declaration-based households use actual generated figures," Duyen said.

Business households currently pay three types of taxes: business license fees, personal income tax, and value-added tax (VAT). However, business license fees for business households will cease from 1/1/2026, according to National Assembly Resolution 198 on tax and fee support for the private economy.

This means that from next year, business households and individuals will only pay VAT and personal income tax if their annual revenue exceeds 500 million dong, as per the amended Law on Personal Income Tax.

Cac gian hang cua tieu thuong tai cho Dong Xuan (Ha Noi). Anh: Hoang Giang

For personal income tax, regulators are adding a tax calculation method based on profit (the difference between revenue and expenses) for business households. Specifically, households with annual revenue under 3 billion dong that can identify input costs will be subject to a tax rate of 15% on their profit. This rate is comparable to the preferential corporate income tax rate for micro-enterprises with equivalent revenue.

Business households with annual revenue of 3-50 billion dong will face a tax rate of 17%, and 20% for revenues exceeding 50 billion dong.

If a household with revenue under 3 billion dong cannot identify its costs, it will continue to pay tax as a percentage of revenue, as currently applied, at a rate of 0,5-2% depending on the industry. However, they will be able to deduct the tax-exempt threshold of 500 million dong per year before calculation.

Regarding VAT, according to Le Thi Duyen Hai, Deputy General Secretary of the Tax Consulting Association, business households, when transitioning to declaration, will still pay VAT based on revenue, and the rate table will remain unchanged. Business households with revenue thresholds from 500 million dong to over 50 billion dong will also apply this method.

The amount of tax payable = taxable VAT revenue (x) tax rate by industry.

The Ministry of Finance's plan for transforming the tax management model and method for business households previously proposed allowing a segment of large-scale business households to apply the deduction method, meaning the VAT payable would equal output minus input. However, according to Duyen Hai, regulators have not yet decided to amend this regulation.

Under the new policy, from next year, a retail business household with an annual revenue of one billion dong will have to pay personal income tax and VAT. The VAT payable will be a fixed rate of 1% on the entire revenue, equivalent to 10 million dong per year.

For personal income tax, if they cannot identify input costs (a common situation for small households), the amount payable will be 0,5% of revenue, after deducting the 500 million dong tax-exempt threshold, which totals 2,5 million dong. In total, this household will pay 12,5 million dong in tax each year.

If they can identify costs, for example, 800 million dong, the personal income tax rate will be 15% on a profit of 200 million dong. Accordingly, this household will pay 30 million dong in personal income tax per year. The total tax they will pay is 40 million dong.

According to the amended Law on Tax Administration, from 1/1/2026, business households and individuals can self-determine their annual revenue for tax payment. If they use e-invoices with tax authority codes, the management system will determine the VAT and personal income tax payable. This data will be updated for taxpayers on eTax - the e-tax application, and the national public service portal. If they do not use e-invoices, they will self-determine the tax amount payable.

For individuals and households selling on e-commerce platforms, according to Decree 91/2022, the platforms will declare and pay taxes on their behalf. This means that responsibility for incorrect or insufficient tax obligations lies with the platform management unit, not the business household. A representative of the Tax Consulting Association believes this significantly reduces administrative procedures for individuals and business households selling on e-commerce platforms.

For Facebook, Zalo, and TikTok - foreign provider platforms that do not collect payment from buyers - sellers must self-declare and pay tax on their revenue.

Also, under the amended Law on Tax Administration, business households and individuals with annual revenue of one billion dong or more must use e-invoices with tax authority codes or invoices generated from cash registers. Households with annual revenue under one billion dong are not required to use this type of invoice.

As of the end of 2024, Vietnam had approximately 3,6 million business households and individuals. The number of stably operating households (lump-sum and declaration-based) is 2,2 million. In 2024, they contributed about 26.000 billion dong to the budget, and this figure was 17.000 billion dong in the first half of this year.

Tax calculation methods for business households from 2026:

Phuong Dung