PIT on Contractor & Collaborator Contracts in Vietnam (2026)

Jul 21, 2026

HR & Payroll

PIT Calculation on Contractor, Collaborator, and Service Contracts (2026)

When a business pays wages or remuneration to individuals providing services through contracts such as contractor contracts, collaborator contracts, probation contracts or consulting service contracts… the business is responsible for withholding Personal Income Tax (PIT) at source before making the payment.

The detailed PIT calculation for each category is as follows:

Table of Contents

For Contractor Contracts, Task-Based Contracts

The tax treatment for individuals under contractor contracts depend on whether the individual is registered as a business:

If the individual is registered as a business:

Regulation: The individual shall self-declare and pay taxes in accordance with regulations on households and individual businesses under Circular 18/2026/TT-BTC (as amended by Circular 50/2026/TT-BTC).
Business Obligation: The business does not have to withhold PIT when paying the remuneration.

If the individual is NOT registered as a business:

The contractor is subject to PIT withholding at the statutory rate (under Clause 2, Article 50 of Decree No. 253/2026/ND-CP). There are 4 specific cases:

Case 1: Payment is under VND 5 million/occurrence

The business is not required to withhold PIT. The worker receives the full remuneration without any tax deduction.

Note: If the payment is under VND 5 million/occurrence, the paying organization or individual may still withhold tax at the rate of upon the individual’s request.

Case 2: Payment is VND 5 million/occurrence or more, with a Tax Commitment Form

If the worker submits a tax commitment form to the business, the business is not required to withhold PIT. The worker receives the full remuneration.

The latest tax commitment template for 2026 is Form 08/CKTNCN, issued under Circular 80/2021/TT-BTC.

Case 3: Payment is VND 5 million/occurrence or more, without a Tax Commitment Form

If the worker does not submit a tax commitment form (either due to ineligibility or failure to do so), the business must withhold PIT at the rate of on the income before making the payment. The tax is deducted directly from the worker’s payout.

Case 4: Payment is VND 5 million/occurrence or more, with a “Net” contract agreement

If the contract explicitly states that the remuneration is exclusive of PIT (Net) and the business is responsible for paying the tax on behalf of the individual, the worker receives the full remuneration and the business bears the tax liability.

For Collaborator Contracts

The PIT calculation for collaborators is determined based on the legal nature of the contract signed:

Service Contract

Nature: An agreement to provide services where the collaborator performs tasks without the direct management or administrative control of the business.
Tax Calculation: A flat withholding tax of is applied in accordance with Clause 2, Article 50 of Decree No. 253/2026/ND-CP (subject to the same 4 cases outlined above).

Labor Contract

Nature: An agreement involving paid work, wages, and the direct management, supervision, and control of the business (regardless of the contract’s title).
Tax Calculation:
- Labor contract under 3 months: Subject to a withholding tax rate in accordance with Clause 2, Article 50 of Decree No. 253/2026/ND-CP (subject to the same 4 cases outlined above).
- Labor contract of 3 months or more: Tax is calculated using the Progressive Tax Rate Scale.

For Consulting Service Contracts

For individuals providing consulting services (without business registration):

Tax Calculation: The business must withhold PIT at a flat rate of on the gross income before payment, in accordance with Clause 2, Article 50 of Decree No. 253/2026/ND-CP (subject to the same 4 cases outlined above).

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