A non-resident individual selling capital in Vietnam faces a tax mechanism entirely different from a resident’s: instead of 20% on the gain, they bear tax at a percentage on the entire transfer price, whether the deal gains or loses, and that tax is almost always withheld by the buyer before the money leaves Vietnam. This article sets out the computation, the source withholding mechanism, and the practical role of double tax agreements for non-resident individual sellers.
1. The non-resident computation: a percentage of the total transfer price
Under the personal income tax regime for non-residents in the Law on Personal Income Tax 109/2025/QH15, a non-resident individual’s income from capital transfers in Vietnam is taxed at 0.1% of the revenue/transfer price per transaction — with no deduction of cost basis or expenses. This architecture is the complete opposite of the resident’s (20% on net income): the non-resident files with less proof burden but is taxed even on a loss deal, while the resident is taxed on the real gain but must prove cost basis. Example: a non-resident selling a stake for VND 20 billion owes Vietnamese tax of 0.1% × 20 billion = VND 20 million whether the cost basis was 19 or 21 billion. On residence status: a person is a non-resident individual when they do not meet Vietnam’s tax residence conditions (present in Vietnam under 183 days in the tax year and having no regular place of abode in Vietnam under the statutory criteria) — this status determination must be made at the transaction’s outset because it drives the entire tax mechanism, and the seller should prepare their home-country tax residence certificate for both the Vietnamese side and the home side.
2. Withholding at source: the buyer retains the tax before paying
Tax collection from non-residents operates through withholding at source: the income-paying organisation or individual in Vietnam — in practice the stake buyer or the company whose capital is transferred, per their role in the deal — must withhold the 0.1% on the transfer price before paying the non-resident seller, and declare and remit it to the budget per period/per occurrence under current tax administration rules. The negotiating consequence: the contract price must be understood as gross of Vietnamese tax or as the net amount the seller actually receives — one line in the price and tax clause decides who economically bears this 0.1%, and in deals with foreign sellers the clause “the price includes all Vietnamese taxes” or “the buyer shall withhold and remit on behalf” needs to be written explicitly. The non-resident seller should also keep the Vietnamese withholding/payment vouchers: they evidence tax paid at source for the seller to claim a foreign tax credit in their residence country where that country’s regime allows it. On the cash flow side: where the seller also receives money through the Vietnamese banking system/a related ICA, the tax documents are part of what the bank checks before clearing the remittance.
3. Double tax agreements: when they actually help the seller
Vietnam has signed double tax agreements with more than 80 countries and territories. For capital transfer gains, the common pattern in Vietnam’s treaties (the clause corresponding to Article 13 of the OECD/UN models) is to preserve the source country’s — Vietnam’s — taxing right over gains from transferring shares/capital contributions, particularly clearly for shares in companies whose assets consist principally of Vietnamese real estate; some older treaties are structured differently depending on signing date and partner. The practical consequence: in most cases the treaty does not eliminate the non-resident’s 0.1% Vietnamese tax — the treaty’s main value for the seller lies on the residence-country side (crediting the Vietnamese tax against home-country tax, avoiding double taxation of the same income) and in other income categories. Where a seller believes the applicable treaty permits exemption/reduction in Vietnam, they must run the treaty application procedure under the Law on Tax Administration 108/2025/QH15: notifying/requesting treaty application with a tax residence certificate and the transaction file lodged with the tax authority within the prescribed time — not unilaterally skipping withholding and explaining afterwards. The wise step is to read the capital gains clause of the exact treaty with the seller’s residence country before signing the agreement, so the contract’s tax clause reflects both parties’ correct expectations.
4. Closing checklist for a non-resident individual seller
A closed capital transfer by a non-resident individual comprises: (1) determining and documenting the seller’s tax non-residence status at the transaction date; (2) a transfer agreement stating the price, the source withholding mechanism and the party responsible for withholding/declaration; (3) the buyer/related organisation withholding 0.1% of the transfer price, declaring and remitting the tax, and handing the vouchers to the seller; (4) the company performing the member/shareholder change and corresponding investment certificate amendment (if an FDI company); (5) the seller checking the applicable double tax agreement — running the treaty application procedure if there is a basis for exemption/reduction in Vietnam, otherwise using the Vietnamese tax vouchers for credit in the residence country; (6) both sides archiving the full transaction file for later tax reconciliation cycles. Overall, the non-resident’s capital transfer tax in Vietnam is small in rate (0.1% of price) but not small in procedure: it attaches to source withholding, to bank cash flows and to the home-country treaty file — and all three attachment points must be designed into the agreement, not handled after the money has moved.
I am a non-resident foreigner selling capital in Vietnam — how is my tax computed?
Under the Law on Personal Income Tax 109/2025/QH15, a non-resident individual transferring capital in Vietnam is taxed at 0.1% of the total transfer price per transaction — no deduction of cost basis or expenses, applying even to a loss sale. This is fundamentally different from a resident individual, who bears 20% on income (price less purchase price and expenses) and owes nothing on a loss sale.
Must the buyer withhold tax before paying me?
Yes. Collection from non-residents works by withholding at source: the buyer or the Vietnamese organisation involved in the transaction withholds 0.1% of the transfer price before payment, and declares and remits it to the budget on the seller’s behalf. The transfer agreement should therefore state clearly whether the price is gross or net of Vietnamese tax and who economically bears it; the seller should obtain and keep the tax payment vouchers for use in the residence country.
What tax rate applies to a non-resident individual?
0.1% of the total transfer price of each capital transfer, under the non-resident capital transfer income regime in the Law on Personal Income Tax 109/2025/QH15. This rate does not depend on the deal’s gain or loss or on the stake’s value; it differs from the 20%-on-income rate for resident individuals and the 2% fallback where a resident cannot determine purchase price and expenses.
Can I benefit from a double tax agreement?
You must check the specific treaty with your residence country: the common pattern in Vietnam’s treaties preserves Vietnam’s taxing right over capital transfer gains (the clause corresponding to international-model Article 13), so in most cases the 0.1% Vietnamese tax is still collected and the treaty’s value lies in crediting that tax in the residence country. If the applicable treaty permits exemption/reduction in Vietnam, the seller must run the treaty application procedure (notification with a tax residence certificate) under the Law on Tax Administration 108/2025/QH15 — withholding may not simply be skipped.