According to the Circular, the persons covered by a Double Taxation Agreement (Tax Agreement) are residents of Vietnam or a Contracting State, or persons who are concurrently residents of both Vietnam and a Contracting State.
(i) A resident of a Contracting State as referred to above includes:
- A person who is liable to tax in that Contracting State under its laws and satisfies one of the following two conditions:
+ In the case of an individual, the individual has a home or place of residence in that Contracting State or satisfies criteria of a similar nature;
+ In the case of an organization, it is a company or any organization of individuals, companies, or other entities that has its place of management or registered office in, or is incorporated in, that Contracting State, or satisfies criteria of a similar nature;
- The State or a grassroots or local authority of a Contracting State, where so provided in the relevant Tax Agreement;
- Depending on each Tax Agreement, a resident of a Contracting State does not include a person liable to tax in that State solely in respect of income from sources or property situated in that State.
(ii) Residents of Vietnam under Vietnamese law include:
- Resident individuals specified in Article 4 of the Government’s Decree No. 253/2026/ND-CP elaborating on several articles of the Law on Personal Income Tax;
- Companies and any organizations of individuals, companies, or other entities registered to operate under Vietnamese law;
- The State or a local authority of Vietnam, where so provided in the relevant Tax Agreement;
- Depending on each Tax Agreement, a resident of Vietnam does not include a person liable to tax solely in respect of income from sources or property situated in Vietnam.
A resident of Vietnam specified in this Clause shall be regarded as a resident under the relevant Tax Agreement if the conditions specified in Points a.1 and a.2 Clause 2 Article 8 of Circular No. 95/2026/TT-BTC are satisfied.
(iii) Where a person is determined to be both a resident of Vietnam and a resident of a Contracting State under the law of that Contracting State, the person’s residence status shall be determined according to the following criteria:
- For individuals:
Whether an individual is a resident of Vietnam shall be determined by applying the following criteria successively:
+ The individual has a permanent home in Vietnam, whether owned, leased, or otherwise available for the individual’s use;
+ Where the individual has a permanent home in both Vietnam and the Contracting State, the individual has closer economic relations with Vietnam, such as employment, a place of business, a place where personal assets are managed, or other economic relations; or closer personal relations with Vietnam, such as family or social relations;
+ Where the individual has a permanent home in both Vietnam and the Contracting State but it cannot be determined where the individual’s economic and personal relations are closer, or where the individual has no permanent home in either Vietnam or the Contracting State, but the individual has a habitual abode in Vietnam during the tax year;
+ Where the individual has a habitual abode in both, or neither Vietnam nor the Contracting State, but the individual is a Vietnamese national;
+ Where the individual is a national of both Vietnam and the Contracting State, or is a national of neither, the Vietnamese competent authority shall resolve the individual’s residence status through the mutual agreement procedure with the competent authority of the Contracting State.
Where, under the laws of Vietnam and the Contracting State, an individual is concurrently determined to be a resident of both Vietnam and the Contracting State during a tax year, but the two countries apply different tax years, the individual shall be regarded as a resident of Vietnam if the individual principally works and habitually resides in Vietnam during the tax year. For the period at the beginning of Vietnam’s tax year that falls within the preceding tax year of the Contracting State due to the difference between the two countries’ tax years, the individual shall be regarded as a resident of the Contracting State for the purposes of tax finalization in Vietnam and the Contracting State.
- For persons other than individuals:
Subject to the provisions of each Tax Agreement, a person other than an individual shall be regarded as a resident of Vietnam if it falls into any of the following cases:
+ It is incorporated or registered to operate in Vietnam;
+ It has its head office in Vietnam;
+ It has its place of effective management in Vietnam. The place of effective management is the place where senior management personnel or the management board of the enterprise meets, considers, discusses, and makes managerial decisions or decisions concerning the enterprise’s production or business activities, or where its most important accounting books and records are kept;
+ Where the person is incorporated or registered in both countries, or has its head office or place of effective management in both countries, the competent authorities of Vietnam and the Contracting State shall determine, through the mutual agreement procedure, that the person is a resident solely of one of the two countries. Where Vietnam and the Contracting State fail to reach a mutual agreement, that person shall not be regarded as a tax resident of either country for the purposes of applying the Tax Agreement.
The aforesaid provisions concerning residents are set out in the Resident Article of the relevant Tax Agreement.
See more details in Circular No. 95/2026/TT-BTC effective as of July 1, 2026.
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