VI When does the family circumstance deduction for a dependent child who is attending university cease to apply after the child graduates? According to guidance issued by the Tax Department, the determination of the deduction termination date must be based on the monthly deduction principle and the tax registration documentation requirements under the prevailing regulations. Pham Consult examines the applicable rules and guidance in the following article.
1. What Is the Family Circumstance Deduction?
Under Clause 1, Article 10 of the Law on Personal Income Tax, “the family circumstance deduction is an amount deducted from taxable income before calculating personal income tax on employment income earned by a resident individual.”
The purpose of this deduction is to ensure that taxpayers are taxed only on income exceeding the amount necessary to meet their basic living needs and those of their dependents.
The applicable deduction amounts are VND 15.5 million per month (VND 186 million per year) for the taxpayer and VND 6.2 million per month for each dependent.
2. When Does the Family Circumstance Deduction for a Child End Upon Graduation?
In Official Letter No. 7401/CT-QLNT, the Tax Department provided guidance on this matter as follows:
a. Determining whether a taxpayer’s child qualifies as a dependent
Point b, Clause 4, Article 10 of the Law on Personal Income Tax provides for family circumstance deductions as follows:
“4. Dependents are individuals whom the taxpayer has a responsibility to support, including:
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b) Individuals who have no income or whose income does not exceed the threshold prescribed by the Minister of Finance, including adult children attending universities, colleges, professional secondary schools or vocational training institutions; spouses who are unable to work; parents who have reached the statutory retirement age or are unable to work; and other individuals without support whom the taxpayer is directly responsible for supporting.”
Point c, Clause 2, Article 47 of Decree No. 253/2026/ND-CP dated June 30, 2026, further stipulates:
“Article 47. Family Circumstance Deduction
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Dependents whom the taxpayer is responsible for supporting shall be identified based on the following criteria:
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c) Children (including biological children, legally adopted children, stepchildren of the wife and stepchildren of the husband) attending universities, colleges, professional secondary schools or vocational training institutions, including children aged 18 or older attending general education institutions (including the period from June to September while awaiting Grade 12 examination results), provided that they have no income or their average monthly income during the year from all sources does not exceed the income threshold prescribed by the Minister of Finance;
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Article 48. Principles for Family Circumstance Deductions
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b) When a taxpayer registers a dependent for deduction purposes, the family circumstance deduction shall be provisionally applied for the year from the time the dependent is registered, with the deduction calculated for full months.”
b. Documentation required to establish dependent status
Point d, Clause 1, Article 4 of Circular No. 87/2026/TT-BTC dated June 30, 2026, specifies the documentation required to establish dependent status for family circumstance deduction purposes:
“…d) For children attending universities, colleges, professional secondary schools or vocational training institutions, including children aged 18 or older attending general education institutions (including the period from June to September while awaiting Grade 12 examination results), the documentation must include, in addition to documents proving the parent-child relationship applicable to the relevant cases under Points a, b and c of Clause 1 of this Article, a copy of the student card, a declaration certified by the educational institution, or other documents proving that the child is attending a university, college, professional secondary school, general education school or vocational training institution.”
Based on the above provisions, taxpayers claiming a family circumstance deduction for children attending universities, colleges, professional secondary schools or vocational training institutions must provide sufficient documentation establishing both the parent-child relationship and the child’s enrollment at the relevant educational institution.
In addition, the Tax Registration Authorization Form No. 41/UQ-ĐKT, provided in Appendix II to Circular No. 90/2026/TT-BTC dated June 30, 2026, issued by the Ministry of Finance, includes a field for declaring the “Deduction termination date (month/year)” for each dependent.
Under the applicable principle, the family circumstance deduction for a dependent is calculated for full months. Accordingly, where a taxpayer’s child graduates from university and is awarded a degree on August 14, 2026, the deduction termination date to be declared in Form No. 41/UQ-ĐKT is September 2026.
