Vietnam's 2026 Tax Reforms For Household Businesses: Navigating the Transition in Cross-Border E-Commerce

The year 2026 marks a pivotal regulatory shift for millions of household businesses in Vietnam, particularly those operating across international e-commerce platforms. The abolition of the presumptive tax regime (thuế khoán) effective January 1, 2026 according to Decision No. 3389/QD-BTC, coupled with series of new tax and accounting regulations such as the Corporate Income Tax Law No. 67/2025/QH15, Decree No. 320/2025/NĐ-CP, Decree No. 117/2025/NĐ-CP on tax administration for business activities on e-commerce platforms, Circular No. 152/2025/TT-BTC guiding the accounting regime for household businesses, and other related instruments, fundamentally transforms the tax compliance landscape for individual sellers.

At Sliner, we have partnered with hundreds of cross-border sellers throughout their growth journey. Drawing on our specialized expertise in tax and financial advisory for the e-commerce sector, we observe that these regulatory changes represent not merely heightened compliance requirements, but a strategic opportunity for businesses prepared to standardize their operations.

The End of Presumptive Taxation

Historically, many household businesses operated under the presumptive tax regime — a simplified system with fixed monthly tax obligations that required minimal documentation of input costs or detailed accounting records. Commencing 2026, all household businesses must transition to self-assessment and self-declaration methodology. This transition entails:

• Self-determination of taxable revenue, deductible expenses, and tax liabilities

• Mandatory electronic invoicing (particularly for businesses with annual revenue exceeding VND 1 billion)

• Implementation of accounting standards as prescribed by Circular 152/2025/TT-BTC

• Document retention requirements of minimum five years for audit and verification purposes

Platform-based Tax withholding mechanism

Pursuant to Decree 117/2025/NĐ-CP, e-commerce platforms with integrated payment functionality — including both domestic and international platforms such as Amazon and eBay — are now obligated to withhold, declare, and remit taxes on behalf of sellers. Applicable rates are calculated as a percentage of transaction value.

A critical consideration that many sellers have yet to fully appreciate: platform withholding does not exempt household businesses from annual tax finalization obligations. For sellers in the revenue bracket exceeding VND 3 billion, PIT liability continues to be calculated on the basis of (Revenue – Legitimate Deductible Expenses) × Tax Rate (17-20%). Where expense legitimacy cannot be substantiated, the effective tax burden may approach the maximum rate — a material financial risk.

Cross-border e-commerce has long represented a high-potential growth avenue for Vietnamese entrepreneurs, contributing meaningfully to national foreign exchange earnings. However, the inherently international nature of these operations creates complex compliance challenges within the new regulatory framework:

The "Legitimate deductable expense" Conundrum: Current provisions governing deductible expenses for PIT purposes were predominantly designed for traditional domestic commerce. Cross-border sellers, by contrast, routinely incur expenses that cannot be documented with Vietnamese VAT invoices: international advertising expenditure (Amazon PPC, Facebook Ads), overseas fulfillment fees, services from foreign providers, and similar costs. The non-recognition of these legitimate business expenses results in effective tax rates substantially exceeding actual profit margins.

Conditions for applying 0% VAT to overseas revenue: As household businesses are now required to recognise and record their accounting activities similar to enterprises, they will face the same long-standing issue that cross-border e-commerce companies have been dealing with: in practice, it is almost impossible to satisfy all the conditions to substantiate export transactions under Decree 181 on VAT. The only consolation is that the VAT rate applicable to household businesses is 1%, instead of 8% as applied to enterprises.

Unregistered Platform Risk: Not all international e-commerce platforms have completed tax registration in Vietnam. For platforms such as Shopify and Taobao, sellers bear responsibility for proactive declaration — or potentially filing on behalf of the platform's Vietnamese tax obligations — a requirement that introduces considerable complexity and compliance uncertainty.

Concerns have been expressed within the business community that new regulations are primarily revenue-driven. However, a comprehensive analysis of the policy landscape suggests that the Government's underlying objective is the establishment of a transparent, compliance-oriented business environment rather than mere tax maximization.

The most compelling evidence lies in the substantial incentives accompanying compliance:

• Decree 320/2025/NĐ-CP: Household businesses converting to corporate form qualify for a two-year CIT exemption from the first year of taxable income, with preferential rates of 15% (revenue below VND 3 billion) or 17% (revenue VND 3-50 billion).

• Decree 20/2026/NĐ-CP: Newly registered small and medium enterprises qualify for a three-year CIT exemption — a significant benefit that enhances cash flow during the critical early-stage development period.

• Input VAT credit and refund eligibility for corporate entities — a mechanism unavailable to household businesses utilizing the direct percentage method.

• Complimentary accounting software and electronic invoicing infrastructure provided by tax authorities.

Drawing on our experience advising cross-border e-commerce operators, Sliner offers the following observations for consideration by both regulatory authorities and the business community:

For Regulatory Authorities:

•   Enhanced guidance on "legitimate expenses" for cross-border operations is warranted. Application of standards designed for traditional domestic commerce to international e-commerce creates significant practical challenges and may inadvertently render compliant businesses technically non-conforming.

•   Vietnam possesses substantial export advantages. Tax policy should incorporate mechanisms that incentivize and support foreign revenue-generating activities, rather than focusing exclusively on risk management. An approach emphasizing "enablement over enforcement" would facilitate voluntary formalization and sustainable compliance.

•   Consideration of "safe harbor" provisions or presumptive expense allowances for specific sectors would materially simplify compliance procedures for smaller-scale operators.

•   Issue detailed guidance on how foreign e-commerce platforms should issue invoices for service fees charged to Vietnamese sellers, in accordance with Vietnam’s e-invoicing and invoicing regulations. This may include allowing platforms to either issue invoices directly or through a licensed invoicing service provider in Vietnam, so that Vietnamese sellers are able to claim input VAT credits based on valid invoices received from foreign platforms.

For E-Commerce Businesses:

•   Proactive action is essential. The current period requires comprehensive review of business structures, cash flow arrangements, and expense documentation practices.

•   For household businesses with revenue exceeding VND 3 billion, serious consideration should be given to corporate conversion to optimize available tax incentives and establish foundations for long-term growth.

•   Investment in accounting infrastructure and document management systems should commence immediately. This represents not merely a compliance requirement but the foundation for legitimate tax optimization and preparedness for future opportunities including capital raising and M&A transactions.

•   Verification of platform tax registration status (via etaxvn.gdt.gov.vn) is advisable to ensure appropriate proactive compliance measures.

The 2026 tax policy reforms will undoubtedly create substantial adjustment requirements for household businesses, particularly those engaged in cross-border e-commerce. However, rather than viewing these changes as obstacles, we maintain that they represent an opportunity for serious operators to professionalize their businesses and establish more robust, sustainable operational foundations.

At Sliner, we firmly believe that in an era where Vietnam is expanding its global presence, transparency and compliance represent competitive advantages rather than burdens. Businesses that invest in operational excellence today will be best positioned for sustained success in the evolving marketplace.

We stand ready to partner with you on this transformative journey.

Sliner International is a full-service consulting firm specializing in cross-border e-commerce advisory services. We bridge the gap between Vietnamese entrepreneurs seeking global market access and international businesses entering the Southeast Asian market. Our integrated service offering encompasses global corporate structuring, international tax planning, cross-border payment solutions, accounting automation, and strategic advisory for M&A and IPO preparation.

Disclaimer: This article is intended for general informational purposes only and does not constitute professional tax, legal, or financial advice. Readers should consult qualified advisors regarding their specific circumstances.