A foreign expert finishing an employment contract in Vietnam and heading home cannot simply leave — the law requires personal income tax finalization before departure. Doing it properly means recovering overpaid tax (a refund) and avoiding the risk of an exit suspension.
This article systematizes the finalization and refund procedure upon departure under current regulations.
1. Current legal framework: PIT Law 109/2025
Personal Income Tax Law No. 109/2025/QH15 was passed on 10 December 2025, effective 1 July 2026, replacing the 2007 PIT Law. Provisions on employment income of resident individuals apply from the 2026 tax year.
Note: documents still citing the 2007 PIT Law as current authority are outdated.
2. The principle: finalize before departure
Under the tax authority’s Official Letter 1296/CT-NVT of 2026: a foreign individual terminating a working contract in Vietnam must file PIT finalization with the tax authority before departure.
If the individual has not completed finalization, they may authorize the income-paying organization or another organization/individual to finalize on their behalf as prescribed. The authorized organization bears responsibility for any additional tax payable or any overpaid tax refundable to the individual.
3. Two ways to do it
- Option 1 — self-finalization: the individual files directly with the tax authority before departure. Suitable when the individual remains in Vietnam long enough to complete the procedure and wants to reconcile the figures personally;
- Option 2 — authorization: authorize the employer (the income-paying organization) to finalize on their behalf. Suitable when the individual must leave urgently; the authorized enterprise files, pays any balance or receives the refund, and bears legal responsibility for the finalized figures.
4. Determining tax residency — the decisive factor
Before finalizing, determine whether the individual is resident or non-resident:
- An individual present in Vietnam for 183 days or more in a calendar year (or in 12 consecutive months) is resident — finalizing by tax year under the progressive table;
- Special case: an individual present fewer than 183 days in the first calendar year, but 183 days or more in 12 consecutive months from the first day of presence in Vietnam — then the first finalization year is those 12 consecutive months from the first day of presence.
Counting arrival/departure days and identifying the first day of presence must be done precisely, as they directly affect the finalization period and tax payable.
5. PIT refunds on overpayment
An individual is entitled to a PIT refund where: tax already paid (withheld monthly) exceeds the tax due after finalization; or tax was paid but taxable income did not reach the taxable threshold. Foreign experts commonly overpay because monthly withholding applied to gross income without full deductions and exemptions at year-end finalization.
Refund/offset dossiers follow tax administration law; an individual who authorized an organization to finalize receives the overpaid amount through that organization.
6. Frequently asked questions
Q: What if I leave without finalizing?
A: There is risk — completing tax obligations is linked to departure conditions; individuals with outstanding tax duties may face a temporary exit suspension under tax enforcement rules. Finalize early or authorize your employer.
Q: Already back home and discovered overpaid tax — can I still get a refund?
A: In principle, overpaid tax is refundable or offsettable as prescribed; the individual may act through the authorized finalizing organization. Keeping all tax withholding vouchers is essential.
Q: Must salary paid by the overseas parent company be finalized in Vietnam?
A: A resident individual earning employment income paid from abroad without withholding during the year must finalize directly with the Vietnamese tax authority if there is additional tax payable or overpaid tax to be refunded/offset.
A foreign expert about to finish a contract in Vietnam needing finalization support? Contact us for advice.
This article was prepared by the FLAW AI Legal Council. The content is pending QA Council review before submission for approval; it is for reference only and does not replace legal advice for your specific situation.
