Many people who have just inherited a parent's house or a relative's savings account in Vietnam immediately worry that they must pay a large amount of personal income tax, while others overlook the tax obligation entirely and face back-taxes plus late-payment charges when transferring title. From 1 July 2026, the new Personal Income Tax Law officially raises the tax-exemption threshold for inherited assets, so understanding which assets are taxable and which are exempt becomes all the more important for heirs.
When you inherit a house or a bank deposit in Vietnam, do you have to pay personal income tax, and if so, how much? Are the savings in a deceased person's account taxed when the account is transferred into your name? As an overseas Vietnamese or a foreigner not resident in Vietnam, do you face a higher rate than people living in the country? These are questions almost every heir runs into, but the answer depends on the specific type of asset and on the new law taking effect in mid-2026. The article below analyses which assets are taxable, how the tax is calculated and the exemption threshold, the cases of full exemption, how the rules apply to non-residents, and the mistakes that lead heirs to overpay or face back-taxes.
Which inherited assets are subject to personal income tax
A common misconception is that any inheritance means paying personal income tax on the entire value of the assets. That is not the case. The law lists only certain categories of assets as taxable upon inheritance, while most other types fall outside this scope.
In other words, only the following categories of inherited assets give rise to a personal income tax obligation when you receive them: securities; capital contributions in economic organisations; business establishments; real estate such as houses and land; and assets that must be registered for ownership or use, such as cars, motorbikes, ships and boats. Assets outside these categories do not trigger personal income tax upon inheritance.
| Type of inherited asset | Subject to personal income tax on inheritance? |
|---|---|
| Real estate (housing, land use rights) | Yes, unless exempt between close relatives |
| Securities, capital contributions, business establishments | Yes |
| Assets requiring ownership or use registration (cars, motorbikes, ships, boats...) | Yes |
| Cash, bank deposits, savings accounts | No |
| Gold, jewellery, items not requiring ownership registration | No |
One point worth clarifying immediately, because it removes the worry of many families: cash, bank deposits and savings accounts are not on the list of assets subject to personal income tax from inheritance. If a relative leaves you a savings account worth several billion dong, that inherited sum itself is not subject to personal income tax. Interest on deposits at credit institutions is also an item exempt from tax under the new law. This comes as a relief to many heirs, since quite a few still believe that withdrawing inherited money from the bank means a 10% tax deduction.
The 10% rate and the 20-million-dong exemption threshold under the new law from 1 July 2026
For assets within the taxable scope, the calculation is fairly simple and applies a fixed rate.
There are three points to grasp. The rate is 10%, fixed, not progressive by bracket. The tax applies only to the portion of value exceeding 20 million dong, not to the entire value of the estate. And the 20-million-dong threshold is calculated for each occasion of inheritance, not cumulatively across several occasions.
Compared with the old rules, this is the most notable change the new law brings for heirs. Under the 2007 Personal Income Tax Law and its guiding Circular 111/2013, the amount deducted before tax was only 10 million dong for each receipt. Personal Income Tax Law No. 109/2025/QH15 raises this threshold to 20 million dong, applicable to inheritance arising from the date the law takes effect.
To picture it, suppose an aunt, who is not among the relatives entitled to exemption, leaves you an apartment worth 3 billion dong. The assessable income is the portion above 20 million dong, that is 3 billion minus 20 million, leaving 2.98 billion dong. The personal income tax payable equals 10% of this figure, that is 298 million dong. But if you inherit that same apartment from your father or mother, the tax payable is zero, for the reason set out just below.
When an heir is exempt from personal income tax
The law provides one very important and common exemption: inheritance of real estate between close relatives.
Accordingly, if you inherit a house or land from your spouse, from your biological parents, adoptive parents, parents-in-law, from your grandparents, or between siblings, that real-estate inheritance is fully exempt from personal income tax, regardless of how large the value is. This is why, in most cases, a child receiving a house or land left by a parent pays no personal income tax at all.
However, there is a boundary that many overlook. This exemption applies only to real estate. If, within that same close relationship, the asset is instead securities, a capital contribution or an asset requiring ownership registration such as a car, the inheritance is still taxed at 10% as usual. For example, a car worth 1 billion dong left by a sibling still gives rise to personal income tax, even though the sibling relationship is among the close-relative group, because the exemption covers only housing and land, not every type of asset.
To qualify for the exemption, you must prove your family relationship with the deceased through civil-status documents such as a birth certificate or marriage certificate. For heirs abroad, these documents are usually issued by foreign authorities, so they must be consular-legalised, or apostilled where the issuing country is a party to the Convention applicable in Vietnam from 11 September 2026, and notarially translated into Vietnamese before submission.
How overseas Vietnamese and non-resident foreigners pay inheritance tax
A very common worry among overseas-Vietnamese and foreign clients is that, because they do not live in Vietnam, they will be taxed more heavily on inheritance than people in the country. To answer this, one must first distinguish a resident individual from a non-resident individual. Under Article 2 of the Personal Income Tax Law 2025, a resident individual is a person present in Vietnam for 183 days or more in a year, or who has a regular place of residence in Vietnam; a person who meets neither condition is a non-resident individual. Most overseas Vietnamese and foreigners settled stably abroad fall into the non-resident group.
What reassures many people is that, for inheritance, the rate for a non-resident is no higher than for a resident.
That means whether you are a resident or a non-resident, the personal income tax on a taxable inherited asset is 10% on the portion exceeding 20 million dong. The difference lies in scope: a non-resident is taxed only on inheritance arising in Vietnam. And the exemption for real estate between close relatives in Article 4 likewise does not distinguish by nationality or place of residence, so a child holding foreign nationality who inherits a house or land from a parent in Vietnam is still exempt from personal income tax just like a child living in the country.
The procedure for declaring and paying personal income tax on inheritance
Personal income tax on inheritance is declared on each occasion it arises, tied to the procedures for receiving and transferring title to the assets. In practice, the process usually runs through the following steps.
- Complete the declaration or division of the estate at a notarial practice organisation, together with the posting procedure required by law, to determine who receives which portion.
- Declare personal income tax on the inheritance. For real estate, the declaration is usually made at the same time as the title-transfer dossier at the land registration office or the one-stop section.
- The tax authority determines the assessable value and issues a tax notice. The assessable value of real estate is based on the land price table and the Government's detailed regulations, and is not entirely self-declared by the parties.
- Pay 10% on the portion exceeding 20 million dong as stated in the notice, together with other charges such as the registration fee and notary fees, which are governed by separate regulations.
- Complete the title-transfer registration to formally hold the asset in your name.
One important timing point: the moment for determining assessable income on inheritance is the moment you receive the inheritance, that is the moment of completing receipt of the asset and registering ownership, not the moment the deceased passed away. Accordingly, if the receipt and title transfer are completed from 1 July 2026 onward, the 20-million-dong threshold of the new law applies.
It is also necessary to distinguish two taxes that are easily merged into one. The tax on receiving the inheritance, that is the 10% above, is one matter. If you later sell the inherited real estate to transfer its value abroad, that sale is a separate taxable transaction, with personal income tax on real-estate transfer equal to 2% of the transfer price under Article 14 of the Personal Income Tax Law 2025. These are two different moments and two different taxes, both of which should be anticipated when calculating the value you actually receive.
Common mistakes that lead heirs to overpay or face back-taxes
Most trouble with inheritance tax does not come from a high rate, but from misunderstanding the scope and the timing. Below are the practical mistakes that heirs, especially those far away, need to avoid.
First is assuming every asset is taxed. As analysed, cash, deposits, gold and most movable assets that need no registration fall outside the taxable scope. Misreading this point leads many to misjudge their obligation, and even to hesitate to accept an estate that is rightfully theirs.
Second is assuming that being a relative means every asset is exempt. The exemption in Article 4 applies only to real estate. Receiving a car, shares or a capital contribution from a sibling still requires paying 10% tax on the portion exceeding 20 million dong.
Third is failing to declare on the assumption that, being abroad, the tax authority will not know. The tax obligation is tied to the title-transfer procedure in Vietnam. When ownership is registered, or when the asset is transferred later, the records will show it clearly, and non-payment may lead to back-taxes plus late-payment charges.
Fourth is confusing the transitional timing. Inheritance completed before 1 July 2026 applies the old threshold of 10 million dong; from 1 July 2026 the new threshold of 20 million dong applies. For a dossier in progress around this date, the difference in threshold can affect the amount of tax payable.
Fifth is lacking the documents to prove the relationship for the exemption. If you cannot produce valid civil-status documents that have been consular-legalised or apostilled and notarially translated, the tax authority may refuse the exemption and tax the inheritance as if between unrelated parties.
Sixth is being complacent about valuation. The assessable value of real estate is based on the land price table, which can differ greatly from the figure the parties agree between themselves, so it must be anticipated accurately to avoid being caught short on the cash needed to pay the tax.
DEDICA's role in handling inheritance tax with foreign elements
DEDICA helps heirs, especially clients abroad, determine precisely which portion of an estate is taxable, which is exempt, and the estimated tax payable before the procedures begin, so there are no surprises about cash flow. We review and standardise the set of documents proving the family relationship in order to protect the right to exemption, and handle the consular legalisation or apostille and notarised translation of documents issued abroad.
For clients unable to return to Vietnam, DEDICA acts under power of attorney to carry out the whole package, from declaring the tax, working with the tax authority and the land registration office, to completing the title transfer. Where needed, we plan the strategy for selling the asset and transferring the value of the estate abroad lawfully, calculating the tax obligation at each step. If you are preparing to receive an estate in Vietnam, a short consultation to break down the tax obligation from the outset will help avoid most of the risks above.
Conclusion
Not every inherited asset is subject to personal income tax. Only securities, capital contributions, business establishments, real estate and assets requiring ownership registration fall within the taxable scope; cash, deposits and savings accounts do not. For the taxable portion, the rate is 10% on the value exceeding 20 million dong on each receipt, under the new threshold applicable from 1 July 2026. Inheritance of real estate between spouses, parents and children, grandparents and grandchildren, and siblings is fully exempt, regardless of whether the heir lives in or outside the country; a non-resident likewise pays exactly 10% on the portion exceeding 20 million dong for assets in Vietnam. The three things to do now are: identify which category each asset falls under, taxable or exempt; prepare early the documents proving the family relationship, with consular legalisation or apostille and notarised translation if the documents are issued abroad; and time the receipt of the inheritance correctly around 1 July 2026 to apply the right exemption threshold.
Every inheritance matter has a different mix of assets and family relationships, leading to a different tax obligation. DEDICA Law Firm accompanies you from breaking down the tax obligation, standardising the documents, declaring and working with the tax authority, through to completing the title transfer and transferring the value of the estate to your account, even when you cannot be present in Vietnam. Contact DEDICA for advice from a lawyer on your specific situation.
This article is for reference based on the law in force at the time of writing, in which the Personal Income Tax Law 2025 takes effect from 1 July 2026. Each case has its own particulars; please consult a DEDICA lawyer for precise advice.
