UPDATE ON DECREE NO. 253/2026/ND-CP: PERSONAL INCOME TAX ON CAPITAL TRANSFERS AND SECURITIES TRANSFERS
On 30 June 2026, the Government of Vietnam issued Decree No. 253/2026/ND-CP, providing detailed guidance on the implementation of the 2025 Personal Income Tax Law. The Decree took effect on 1 July 2026 and clarifies several important issues relating to personal income tax (“PIT“) on capital transfers and securities transfers.
Most notably, the Decree resolves the uncertainty regarding the tax treatment of transfers of shares in non-public joint stock companies.
1. Transfers of shares in non-public joint stock companies remain securities transfers
Earlier draft versions of the Decree proposed treating transfers of shares in non-public joint stock companies as capital transfers.
However, Article 10.2 of Decree 253 ultimately retains the previous approach by classifying such transactions as securities transfers.
Accordingly, individuals transferring shares in non-public joint stock companies remain subject to the PIT regime applicable to securities transfers rather than capital transfers.
2. PIT on securities transfers
Under Article 10.2 of Decree 253:
- Securities transfer income includes transfers of shares, share subscription rights, bonds, treasury bills, fund certificates and other securities as defined under Vietnamese securities laws.
- PIT is imposed at 0.1% of the transfer price for each transaction.
- Tax filing and payment must be completed before the issuing entity updates the securities ownership register.
3. PIT on capital transfers
Capital transfer income includes transfers of capital contributions in limited liability companies, partnerships and other forms of capital interests.
PIT is calculated as:
- 20% of taxable income, being the transfer price less acquisition cost and deductible expenses; or
- 2% of the transfer price where acquisition cost and deductible expenses cannot be substantiated.
Tax obligations must generally be fulfilled before the enterprise records changes in ownership of the transferred capital interest.
4. No distinction between resident and non-resident individuals
Decree 253 does not establish separate PIT rules for resident and non-resident individuals in respect of capital transfers or securities transfers.
5. Corporate compliance obligations
Article 56.5 of Decree 253 imposes an important compliance obligation on limited liability companies and non-public joint stock companies.
Before recording changes in members or shareholders, the company must verify that the transferor has fulfilled the applicable PIT obligations. Where the transferor fails to do so, the company is required to declare and pay the tax on behalf of the transferor in accordance with the Decree.
Practical takeaway
Correctly distinguishing between a capital transfer and a securities transfer remains critical, as the classification directly affects the applicable tax rate, tax calculation method, filing obligations and corporate compliance requirements.
Disclaimer
This Legal Brief is provided solely for general information purposes and does not constitute legal or tax advice in relation to any specific transaction or factual circumstances.
Author
BFSC Law LLC – Editorial Team