Following Part 1 on calculating incomes from capital contribution, this article will discuss on how to calculate the personal income tax (PIT) on securities transfer.
i. What are the incomes from securities transfer
Income from securities transfer includes income from transfer of stocks, the right to buy stocks, bonds, treasury bills, fund certificates and other securities according to Clause 1 Article 6 of the Law on Securities. Income from transfer of stocks by individuals in a joint-stock company is specified in Clause 2 Article 6 of the Law on Securities and Article 120 of the Law on Enterprises.
Ii. PIT calculation for incomes from securities transfer
– Taxable income:
Taxable income = Securities selling price – (Securities purchase price + Related costs)
In which:
Securities transfer price is determined as follows:
+ For securities of a public company traded on the Stock Exchange, the securities transfer price is the executed price at the Stock Exchange. Execution price means the securities price determined from the result of order matching or the price formed from put-through transactions at the Stock Exchange.
+ For securities other than those mentioned above, the transfer price is the price stated in the transfer contract or the actual transfer price or the book price of the unit having the transferable securities at the time of making the financial statements. the latest approval in accordance with regulations of law on accounting prior to the transfer date.
+ For securities not falling into the above cases, the selling price is the actual transfer price stated in the transfer contract or the book-based price of the unit having the transferred securities at the latest time before the transfer time
If the transfer contract does not specify the selling price or the selling price stated in the contract is not consistent with the market price, the tax authority may fix the selling price in accordance with the law on tax administration.
The securities purchase price is determined as follows:
+ For securities of a public company traded on the Stock Exchange, the securities purchase price is the executed price at the Stock Exchange. Execution price means the securities price determined from the result of order matching or the price formed from put-through transactions at the Stock Exchange.
+ For securities of a public company that are not traded on the Stock Exchange but only transfer the ownership through the transfer system of the Securities Depository Center, the purchase price is the price stated in the contract of receipt. securities transfer.
+ For securities purchased through auction, the securities purchase price is the price stated on the notice of the share auction winning result of the share auction organization and the money order.
+ For securities not falling into the above cases, the purchase price is the actual buying price stated in the transfer contract or the book-based price of the unit having the transferred securities at the latest time before the time of purchase.
If the transfer contract does not specify the purchase price or the purchase price stated in the contract is not consistent with the market price, the tax authority may fix the purchase price in accordance with the law on tax administration.
Related costs:
The reasonable deductible expenses when determining the taxable income from securities transfer are the actual expenses incurred from the securities transfer activities with invoices and documents under the prescribed regime, including:
+ Expenses for the necessary legal proceedings for the assignment.
+ Fees and charges payable by the assignor when completing the assignment.
+ Securities depository service fees comply with the Finance Ministry’s regulations and securities company’s receipts.
+ The investment trust fee, the securities investment portfolio management fee are based on the receipts of the trustee.
+ Securities brokerage fee when transferring.
+ Fee for investment advisory services and information provision.
+ Fee for transfer, fee for transferring ownership through the Securities Depository (if any).
+ Other expenses with supporting documents.
– Tax rate:
+ Applying the tax rate of 20%
Securities transferors who pay tax at the rate of 20% are individuals who have registered tax, have a tax identification number at the time of completing tax finalization procedures and have determined taxable income of each type of securities. guided at Point a, Clause 2, Article 11 of the Circular No. 111/2013/TT-BTC.
The applicable formula is:
Personal income tax payable = Taxable income x Tax rate 20%
+ Applying the tax rate of 0,1%
Securities transferors pay tax at the rate of 0.1% on each transfer price of securities.
Personal income tax payable = Securities transfer price for each time x Tax rate 0,1%
