RSUs and phantom shares differ in the nature of the asset — real parent-company shares delivered once restrictions lapse, versus a mere promise to pay cash tracking a share price — but both raise the same Vietnamese tax question: when does income arise and who withholds. This article separates the two instruments from each other and from ESOPs and stock options, which have their own live article; the deep dive here is the income-recognition point in Vietnam for executives paid under a group plan run offshore.
Legal basis and analysis
RSUs: nothing is taxed at grant because the right is still conditional; employment income arises when the shares vest and are actually delivered, valued at that date under Personal Income Tax Law 109/2025/QH15.
Phantom shares create no shares, so there is no separate ‘share sale’ stage; the entire cash amount paid at maturity or price-fixing is employment income at the payment date and cannot use the securities-transfer tax frame.
Withholding: the Vietnamese entity benefiting from the executive’s work must withhold or coordinate withholding even if the parent administers the plan; if the parent pays directly offshore, a Vietnam-resident executive must still self-declare the portion linked to Vietnam service.
Frequently asked questions
When do I have to pay tax on RSU bonus shares I receive?
Tax is triggered when the RSUs vest and the shares are actually delivered, not on the day the company promises the award. The taxable value is the share value at receipt; a later sale of those shares is a separate transaction, distinct from the employment income at vesting.
How are phantom shares taxed?
Phantom shares are taxed as salary when the company pays the cash, on the full amount received, because the employee never owns any shares. There is no securities-transfer step and the share-sale tax treatment does not apply to this payment.
Does the company have to withhold the tax?
Yes, for the portion linked to work in Vietnam: the Vietnamese entity benefits from the labour, so it must withhold when it pays or coordinate withholding when the parent notifies the vested value; if the parent pays directly, the resident individual self-declares, while the Vietnamese entity still has to supply the data.
This article has been quality-reviewed by the FLAW AI Legal Council
