Proposal to pay tax immediately upon receiving stock dividends, not waiting for transfer

According to the Ministry of Finance, many shareholders have not transferred their shares immediately after receiving dividends in the form of securities or have no need to transfer them, while their assets are constantly increasing...

The Ministry of Finance proposes that individuals receiving dividends and bonuses in the form of securities will pay taxes immediately, instead of waiting until the transfer - Photo: AI drawing

Worry about policy profiteering if taxes are not collected immediately...

The Ministry of Finance is seeking comments on a draft decree amending and supplementing a number of articles of Decree 126 guiding the implementation of the Law on Tax Administration.

According to the Ministry of Finance, during the period from 2016 to the end of 2024, individuals receiving dividends in securities and individuals who are existing shareholders receiving bonuses in securities received a total of 34.84 billion shares.

If all of these shares are transferred and the share price is calculated at par value (VND 10,000), with a tax rate of 5%, the estimated personal income tax to be declared and paid is about VND 17,420 billion.

However, in reality, according to the Ministry of Finance, the amount of personal income tax from the income of individuals receiving dividends in securities and existing shareholders receiving bonuses in securities declared in the above period is only about 1,318 billion VND, accounting for nearly 8% of the estimated 17,420 billion VND mentioned above (if all of these shares are transferred).

Also according to statistics of this ministry, in the period 2016-2024, the total amount of personal income tax declared from capital investment activities reached 51,965 billion VND, of which tax collected from dividends and bonuses paid in securities was only about 1,318 billion VND, accounting for 2.54%.

Notably, the Ministry of Finance also cited international experience from Thailand and India, showing that these countries stipulate that the time for calculating tax is when dividends are paid, and organizations issuing shares paying dividends are obliged to deduct tax at the stock dividend tax rate.

Thailand applies a 10% tax rate, while India applies a 10% tax rate on income exceeding 5,000 rupees.

How will the tax rate be calculated?

To limit the exploitation of policies and prolong the time for performing the obligation to declare and pay personal income tax, the Ministry of Finance believes that it is necessary to clearly stipulate the time of deduction and amend the time of declaring personal income tax for income from dividends, bonus payments in securities, and income from capital increased due to capital increase profits.

Accordingly, the tax authority has proposed that personal income tax will be deducted, declared and paid immediately when individuals receive dividends and bonuses in the form of securities.

"Do not wait until transferring the same type of securities to declare and pay personal income tax on this income," the Ministry of Finance stated.

At the same time, the income-paying organization will deduct personal income tax at the time the enterprise pays dividends and bonuses, according to the previous notice sent to shareholders.

The Ministry of Finance also added a method to determine the amount of personal income tax to be deducted. Accordingly, the amount of personal income tax deducted is determined by multiplying the value of dividends, profits, and bonuses by the personal income tax rate from capital investment (5%).

Under current regulations, dividends and profits are paid in many forms such as cash, securities or recognition of increased capital contributions.

With cash dividends, the paying organization has deducted, declared and paid taxes on behalf of the individual.

However, with dividends or bonuses in the form of securities, or capital increase, because the money has not been received, tax does not have to be paid, but must be declared when the individual transfers or withdraws capital.

The tax authority considers this regulation inappropriate, because many shareholders have not transferred immediately after receiving or have no need to transfer, while their assets are constantly increasing.

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BINH KHANH

Source: https://tuoitre.vn/de-xuat-nop-thue-ngay-khi-nhan-co-tuc-bang-chung-khoan-khong-doi-luc-chuyen-nhuong-20250630193711854.htm