Do you have a friend or relative living in Vietnam? Do you wish to send money to Vietnam? There could be several reasons for sending money to Vietnam from India. From sending the money to someone close to paying the education fees, business transactions, and so more –all of these reasons might call for the selection of the best mode of transferring money abroad from India.
The sending of money internationally helps you in transferring big or small amounts of money with much ease. Usually, the transfer of money to a particular recipient abroad like in Vietnam would involve you to give the desired funds to some bank institution or independent money transfer service provider. These service providers then send the money to the desired recipient. This process can be done by a person, over the phone, through some mobile app or even online. The users can also make use of cash, debit card, or a credit card for making the transactions. Transferring money to Vietnam also follows the same process.
Tax Considerations While Sending Money to Vietnam
As the banks and money transfer service providers might offer the ease of sending money in an instant, the situation becomes complex when the matter of tax payment comes into role of the international transactions. With so much scrutiny going over the international affairs, the sender must ensure that they are not tripping over any rules & regulations that could get them in trouble. To avoid any conflict while transferring money internationally to Vietnam, it is wise to consider the potential tax implications over transferring money abroad.
The Gift Tax
While transferring money overseas, the biggest concern that comes in the way is the Gift Tax. While the implications of the same might differ from one country to the other, the basic principle applies in a similar manner. The underlying principle of the gift tax states that whenever an individual would be sending more than the predefined amount of money to the same individual within a span of one year, then the sender must file a return with the respective governing body or organization. Each country has different sets of rules and limitations over the fixed amount of money that is permissible to be sent to a particular person abroad in one year.
Tax Implications for Certain Recipients
The tax requirements for senders would also vary greatly on certain factors. One of the major factors that determine the taxes levied on the sender, when he has to remit money to Vietnam is the person who is receiving the desired amount of money. There are different categories of recipients that determine the basis of the implication of taxes on the sender. Here are some:
- To One’s Dependent Child: If the sender is transferring some amount of money to one’s dependent child in Vietnam, then there might be no gift tax levied on the sender. This is because the money is supposed to provide support to the minor. However, if the child is not dependent and the transfer needs to be done, then some taxes are implied.
- To Family: If the money is sent to some family members in Vietnam, then the sender is supposed to pay some amount of tax for the same. However, the sender is allowed to divide the total amount of money on the basis of the number of people it will be supporting.
- To One’s Own Account: Individuals who are doing banking in their account in Vietnam must have to report the existence of the bank account to the governing authorities. The taxes can be then implied as per the current government rules.
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