Vietnam Tax Guide for Foreign Teachers (Personal Income Tax Explained)

Foreign teachers working in Vietnam are subject to personal income tax (PIT) just like Vietnamese employees. Understanding how Vietnam’s tax system works is crucial for staying compliant, avoiding penalties, and planning your finances. This guide explains Vietnam’s personal income tax rules for foreign teachers, updated to September 2025.

1. Do Foreign Teachers Need to Pay Income Tax in Vietnam?

Yes. Any foreign teacher earning income in Vietnam is required to pay personal income tax (PIT). Tax obligations depend on your residency status:

• Resident taxpayer: If you stay in Vietnam for 183 days or more within a tax year, or have a permanent residence (work permit, rental contract), you are taxed on your worldwide income.
• Non-resident taxpayer: If you stay in Vietnam less than 183 days, you are taxed only on income earned in Vietnam, at a flat rate.
   

2. Tax Rates for Foreign Teachers

Vietnam applies different tax rates depending on your residency status.

For Resident Foreign Teachers (Progressive Rates)

Income is taxed progressively, similar to Vietnamese employees:

• Up to 5 million VND/month → 5%
• 5 – 10 million VND/ month → 10%
• 10 – 18 million VND/ month → 15%
• 18 – 32 million VND/ month → 20%
• 32 – 52 million VND/ month → 25%
• 52 – 80 million VND/ month → 30%
• Over 80 million VND/ month → 35%

For Non-Resident Foreign Teachers

• A flat rate of 20% applies to all Vietnam-sourced income.
   

3. Tax Deductions and Allowances

Foreign teachers who are resident taxpayers may enjoy certain deductions:

• Personal deduction: 11 million VND/month (132 million VND/year).
• Dependent deduction: 4.4 million VND/month per dependent (children, spouse without income, elderly parents).
• Social insurance contributions: Deductible if paid in Vietnam.
• Charitable donations: Certain contributions are deductible.

Non-resident taxpayers cannot claim these deductions.

4. Tax Filing and Payment for Teachers

Foreign teachers must follow Vietnam’s annual tax procedures:

• Withholding by employer: Most schools and language centers deduct PIT monthly and pay on your behalf.
• Annual tax finalization: By March 31 of the following year, resident taxpayers must finalize their tax with the local tax office.
• Self-filing: If you work for multiple schools, you may need to file directly to ensure correct tax reporting.
   

5. Double Taxation Agreements (DTA)

Vietnam has signed double taxation agreements with over 80 countries (including the US, UK, Australia, Canada, and most EU nations).

• If you are from a country with a DTA, you may avoid being taxed twice on the same income.
• To benefit, you must provide proof of tax residency from your home country and apply through Vietnam’s tax authorities.
   

6. Common Issues for Foreign Teachers

• Misclassification of residency: Some teachers wrongly assume they are non-residents while exceeding 183 days.
• Unregistered income: Teaching freelance or extra classes without declaring income may lead to penalties.
• Deposit or housing allowance taxation: Benefits like housing support or flight allowance are taxable unless specifically exempted.
   

7. Practical Tips for Teachers

• Keep all contracts, payslips, and receipts.
• Track your days in Vietnam to determine residency status.
• Ask your school whether they handle tax withholding and annual finalization.
• If you have multiple income sources, consult a local tax advisor.
• Check whether your home country has a double taxation agreement with Vietnam.
   

8. Penalties for Non-Compliance

Failure to declare or pay tax may result in:

• Late payment interest (0.03% per day).
• Administrative fines.
• Possible visa or work permit issues.

For foreign teachers, understanding Vietnam’s personal income tax system is essential. Whether you are a short-term teacher or a long-term resident, knowing your tax rates, residency status, and deductions will help you stay compliant and protect your earnings. By working with your school and staying informed, you can avoid penalties and make the most of your teaching career in Vietnam.