Decree 68/2026/ND-CP: Comprehensive Reform of Business Household Tax Policy – Opportunities and Challenges for Small Businesses in 2026

19-04-26 Việt Quang

On March 5, 2026, the Vietnamese Government issued Decree 68/2026/ND-CP regulating tax policies and tax administration for business households (BH) and individual businesses (IB), effective from the date of signing. This marks the most significant breakthrough in tax policy for the informal private sector in years: the traditional fixed-rate tax (lump-sum tax) method has been completely abolished, replaced by a self-declaration, self-calculation, and self-payment mechanism based on actual revenue. Notably, today — April 20, 2026 — is the final deadline for business households to submit their inventory and asset declarations under the Decree’s transitional provisions.

End of the ‘Lump-Sum Tax’ Era: Business Households Must Now Self-Declare and Self-Calculate

The core breakthrough of Decree 68/2026/ND-CP is the complete elimination of the fixed lump-sum tax method that had existed for decades. Instead, business households and individual businesses must declare and pay taxes based on actual revenue generated during the year.

Under Article 4 of the Decree, entities with annual revenue of VND 500 million or less must notify the tax authority of their actual revenue and file relevant tax returns no later than January 31 of the following calendar year — and are not required to pay VAT or personal income tax (PIT). For those exceeding this threshold, tax filing obligations arise on a quarterly or monthly basis depending on revenue scale.

The VND 500 Million Tax Exemption Threshold: A Major Opportunity with Binding Conditions

The VND 500 million/year tax exemption is welcome news for millions of small traders, food stall operators, grocery owners, and small-scale online sellers. However, Article 5 of the Decree clearly states: this exemption applies only once per individual per calendar year, regardless of how many business locations or service contracts they hold.

This means an individual who both runs a retail shop and takes on freelance service contracts must aggregate all revenue to assess the threshold. This is a critical provision that many business households tend to overlook, creating risks of tax recovery and penalties.

Mandatory E-Invoices and Payment Account Disclosure Obligations

The Decree introduces two new mandatory obligations:

First, under Article 11, business households and individual businesses with annual VAT taxable revenue of VND 1 billion or more must use electronic invoices connected to the tax authority. Those with revenue between VND 500 million and under VND 1 billion are not required but are encouraged to adopt e-invoicing.

Second, under Article 13, all business households and individual businesses must electronically notify the tax authority of all bank accounts and e-wallet IDs related to their business activities. This measure aims to enhance cash flow transparency and prevent tax evasion through informal digital payment channels.

Transitional Deadline: April 20, 2026 — Submit Inventory Declaration Today

Under the transitional provisions of Article 18 of Decree 68/2026/ND-CP, business households operating before the Decree’s effective date must prepare an inventory and asset declaration as of December 31, 2025, and submit it to their direct tax authority no later than April 20, 2026 — which is today.

Failure to meet this deadline may prevent a business household from establishing an initial tax base, affecting input cost deductions and tax liability determination in subsequent periods. Local tax authorities may apply tax assessment measures for non-compliant households under Article 14 of the Law on Tax Administration 2019.

Practical Impact

Approximately 5 million business households and individual businesses nationwide are directly affected by the Decree, with the majority having revenue below VND 500 million set to benefit from the tax exemption policy.
Administrative burden increases in practice for those with revenue above VND 500 million: they must establish revenue tracking systems, adopt e-invoicing, and file periodically instead of paying a fixed lump-sum as before.
Risk of tax recovery and penalties rises significantly as tax authorities now have additional tools to cross-reference cash flow data through banking and e-wallet systems against declared revenue.
Incentive to upgrade to a formal enterprise: business households with revenue of VND 1 billion or more should consider converting to small and medium-sized enterprises to optimize tax obligations and access state support policies.

Recommendations for Business Households and Enterprises

Act today (April 20, 2026): Submit the inventory and asset declaration as of December 31, 2025 to your direct tax authority to comply with the transitional provisions under Article 18 of Decree 68/2026/ND-CP.
Determine your revenue threshold: Review all business income sources to accurately calculate total revenue, avoiding omissions that could result in breaching the VND 500 million threshold.
Register payment accounts with tax authorities: Fully disclose all bank accounts and e-wallets used in business operations as required under Article 13 of the Decree.
Implement e-invoicing (if mandatory): Business households with revenue of VND 1 billion or more should promptly register and use tax-authority-connected electronic invoices.
Seek specialized legal advice: Given the complexity of the new regulations and potential legal consequences, business households and enterprises should consult a lawyer or tax expert before fulfilling their declaration obligations.

MT & Partners Law Firm, with a team of experienced lawyers specializing in business law, taxation, and investment, is ready to advise and assist business households and enterprises in complying with Decree 68/2026/ND-CP, optimizing tax obligations, and mitigating legal risks. Contact us at hotline 0987140772 or email info@mtpartners.vn for consultation.

Disclaimer: This article is for general legal information purposes only and does not substitute for specific legal advice tailored to individual circumstances. For accurate and situation-specific support, please contact a qualified lawyer directly.

Keywords: Decree 68/2026/ND-CP, business household tax 2026, tax exemption VND 500 million, lump-sum tax abolished, e-invoice business household, individual business VAT PIT, tax administration 2026, Vietnam business law, MT Partners Law Firm