Japanese employees present in Vietnam for less than 183 days who receive income paid by a permanent establishment in Vietnam are still required to pay Personal Income Tax (PIT) in Vietnam.

In Official Letter No. 7012/CTDAN-TTHT dated August 19, 2024, the Da Nang City Tax Department provided guidance on Personal Income Tax (PIT) for Japanese employees earning income from working in Vietnam as follows:

Employees sent by the parent company in Japan who earn income from working in Vietnam will only be subject to PIT in Japan (and exempt from PIT in Vietnam) if they meet all three of the following conditions:

• The employee is present in Vietnam for a total period not exceeding 183 days during the relevant calendar year;
• The employer or the person paying the employee’s wages is not a resident of Vietnam; and
• The wages are not paid from a permanent establishment or fixed base in Vietnam of the parent company in Japan.

Therefore, if a Japanese employee receives income paid by a permanent establishment in Vietnam of a foreign company, they will still be required to pay PIT in Vietnam.