Mr. V. asks, in this case, how should he declare taxes? If his total annual income is less than 100 million Vietnamese dong, does he need to declare taxes? In the case where Mr. V.'s total annual income reaches 100 million Vietnamese dong (for example, 8,091 USD, including 4,082 USD from viewers in the United States, 72.7 USD from Vietnam, and 3,936.3 USD from other markets), what is the determined value-added tax (VAT) on revenue? What is the determined personal income tax (PIT) on revenue?

Regarding this matter, the Ministry of Finance responds as follows:

- Based on Article 2 of Circular No. 219/2013/TT-BTC of the Ministry of Finance issued on December 31, 2013, guiding the subjects liable to VAT as follows:

"Article 2. Subjects liable to tax

Subjects liable to VAT are goods and services used for production, business, and consumption in Vietnam (including goods and services purchased from foreign organizations and individuals), except for subjects not subject to VAT as guided in Article 4 of this Circular."

- Based on Article 2 of Circular No. 119/2014/TT-BTC of the Ministry of Finance issued on August 25, 2014, amending and supplementing Clauses 1, 2, 3, 4 of Article 1 of Circular No. 111/2013/TT-BTC dated August 15, 2013, of the Ministry of Finance guiding the implementation of the Personal Income Tax Law, the amended and supplemented Personal Income Tax Law, and Government Decree No. 65/2013/NĐ-CP detailing a number of articles of the Personal Income Tax Law and amending and supplementing a number of articles of the Personal Income Tax Law as follows:

"Article 1. Taxpayers

... The scope of determining taxable income of taxpayers is as follows:

For resident individuals, taxable income includes income arising inside and outside the territory of Vietnam, without distinction as to where the income is paid."

- Based on Circular No. 40/2021/TT-BTC of the Ministry of Finance dated June 1, 2021, guiding VAT, PIT, and tax administration for business households and individual businesses, the guidance is as follows:

+ In Article 2 regarding the subjects applying:

"Article 2. Subjects applying

1. Business households and individual businesses are resident individuals engaged in the production and business of goods and services in all fields and sectors as prescribed by law...

đ) E-commerce activities, including cases of individuals with income from digital content information products as prescribed by e-commerce laws..."

+ In Clause 2 of Article 4 regarding the principles of tax calculation:

"Article 4. Principles of tax calculation

...2. Business households and individual businesses with annual revenue from production and business activities in the Gregorian calendar year of less than VND 100 million shall not be subject to VAT and PIT as prescribed by law on VAT and PIT. Business households and individual businesses are responsible for declaring taxes accurately, truthfully, and fully, and submitting tax documents on time; they are responsible before the law for the accuracy, truthfulness, and completeness of tax documents as prescribed."

+ In Article 5, the guidance on the tax calculation method for business households and individual businesses declaring taxes by declaration;

+ In Article 6, the guidance on the tax calculation method for individual businesses declaring taxes on a per-transaction basis;

+ In Appendix I, which stipulates the list of sectors subject to VAT and PIT as a percentage of revenue for business households and individual businesses.

Based on the above regulations, in principle:

- Products, goods, services, and digital content information (videos) consumed in Vietnam fall within the subject liable to VAT as stipulated in Article 2 of Circular No. 219/2013/TT-BTC of the Ministry of Finance.

Individual residents in Vietnam are subject to personal income tax (PIT) on income arising inside and outside the territory of Vietnam, without distinction as to where the income is paid, as instructed in Article 2 of Circular No. 119/2014/TT-BTC of the Ministry of Finance mentioned above.

- In the case of Mr. V., who is a resident individual earning income from advertising through the uploading of videos on the YouTube platform (income from digital content information products), he must declare and pay VAT and PIT as stipulated in Circular No. 40/2021/TT-BTC dated June 1, 2021, of the Ministry of Finance. Individual businesses can choose the tax calculation method as guided in Article 5 or Article 6 of Circular No. 40/2021/TT-BTC.

In the specific case, it is recommended that Mr. V. provide relevant documentation to the tax authority for further guidance.

By Mai Chi (Government Newspaper).