Household Business Owner: Conditions and Liability

Before registering, many people are unclear about who is allowed to stand as a household business owner, and, once they do, how far their liability extends for debts, tax and disputes. This article summarizes the position under Decree 168/2025/NĐ-CP as currently applied.

The short conclusion: only Vietnamese citizens with full civil legal capacity may stand as household owner, each person may stand for only one household nationwide, and the household owner is liable with all of their assets — even after hiring a manager.

Who may stand as a household business owner?

Clause 2, Article 82 of Decree 168/2025/NĐ-CP provides that an individual or household member standing as household business owner must be a Vietnamese citizen with full civil legal capacity under the Civil Code.

A person may not stand as household owner if they fall into any of these cases:

Being prosecuted for criminal liability or held in temporary detention.
Serving a prison sentence.
Serving an administrative handling measure at a drug rehabilitation facility or a compulsory education facility.
Being banned by a Court from practicing or from work related to business.

The household business is not a door for foreign investors. A foreigner who wishes to do business in Vietnam carries out enterprise establishment procedures under the Law on Enterprises and the Law on Investment — and does not stand as household owner in the name of a spouse or relative who is a Vietnamese citizen while in reality running it themselves. On paper, debts, tax obligations and legal liability remain attached to the name of the registered household owner.

How many households may one person stand for?

Article 83 of Decree 168/2025/NĐ-CP is clear: an individual may register only one household business nationwide, regardless of locality. A person who already stands for a household in their home village may not register a second household elsewhere.

To do business at another location, the household registers an additional business location under the same existing household (under Article 87), rather than establishing a new household. A wife and husband are two separate individuals, so each may stand for one household, but if in reality only one person runs both households, this is a way of evading the rule and may be handled when the authorities verify through the signatory, transaction accounts and actual invoices.

Which assets is the household owner liable with?

Clause 1, Article 84 of Decree 168/2025/NĐ-CP provides that the household business owner and the household members who have given authorization are jointly liable for the household’s business activities, with all of their assets — not limited to the registered capital.

Household model	Who is liable	Scope of assets
Individual registering alone	The household owner	All personal assets
Household members establishing together	The household owner and the members who have given authorization	Jointly, with each person’s assets

Clause 2, Article 84 allows the household owner to hire a manager to manage and operate the business. A point to note: hiring a manager does not change who is liable. Debts, tax obligations and obligations to employees arising from the household’s activities remain with the household owner, not with the hired manager — unless a labor contract or service contract binds the manager to separate compensation liability toward the household owner.

Clause 3, Article 84 provides that the household owner is the person who performs the household’s tax obligations and other financial obligations; and also the household’s representative as the person requesting the resolution of a civil matter, plaintiff, defendant, or person with related rights and obligations before Arbitration, Courts and in other relations as prescribed by law.

May the household owner do other things at the same time?

Two rules need to be distinguished:

May contribute capital to a company as an individual: clause 4, Article 84 of Decree 168/2025/NĐ-CP allows the household owner and household members to contribute capital, buy shares or buy a capital contribution in an enterprise — but as individuals, not in the capacity of a household business (a household is not a legal entity able to stand as a company member).
May not simultaneously be a private enterprise owner: clause 5, Article 84 provides that a household owner or household member who registered the household may not simultaneously be the owner of a private enterprise. The reason: both the household business and the private enterprise are models with unlimited liability with personal assets — the law does not allow one person to hold two layers of unlimited liability in parallel.

To move from a household to a private enterprise or a company, the household owner carries out the procedure to terminate the household or convert it as prescribed, and does not hold both certificates at the same time.

Why does the law limit one person to one household and prohibit holding it in parallel with a private enterprise?

Both the household business and the private enterprise do not separate business assets from the personal assets of the person standing in their name — debts arising from business activity are collected directly against the personal assets of the household owner or enterprise owner. If one person were allowed to stand for several households, or to stand for both a household and a private enterprise, determining which assets are tied to which obligations would be very hard for creditors, the tax authority and the judgment enforcement authority. The rule of one person, one household (Article 83) and of not simultaneously being a private enterprise owner (clause 5, Article 84) stems from that reason; it is not a mere administrative formality.

Practical consequence: a person currently standing for a household business who wants to open another business has two proper options — open an additional business location under the same existing household (if it is the same type), or establish a limited liability company or joint stock company (with liability limited to the capital contributed) rather than opening a second household or private enterprise.

What happens if the household owner dies or loses civil legal capacity?

A household business is not a legal entity, so it does not automatically “continue to exist” when the household owner no longer meets the conditions to stand in its name. If the household owner dies, goes missing, or is declared by a Court to have lost civil legal capacity, the dossier to change the household owner needs an additional death certificate or Court decision, and the person taking over must meet all the conditions to stand as household owner under Article 82. While the procedure to change owner is not yet complete, the household’s tax obligations and signed contracts still need to be handled under the regulations on inheritance of property obligations; this is a situation where someone knowledgeable should help right away, because it involves both the business registration procedure and civil and inheritance law.

Four things to check before standing as household owner

Do I meet the conditions of being a Vietnamese citizen with full civil legal capacity, and am I not in a category banned from practicing?
Do I already stand for any other household business nationwide?
Am I currently a private enterprise owner — if so, this needs to be handled before registering the household.
If it is a household with members contributing capital together: is there a notarized authorization document for one person to be household owner, and do the members clearly understand that they bear joint liability?

What Thái Tín can help with

Thái Tín is the coordinating point that helps individuals and households understand the conditions and responsibilities before standing as household owner:

Check the conditions for standing as household owner, and review cases where the person already stands for another household or is a private enterprise owner.
Explain the scope of joint liability to household members before they sign the authorization document.
Prepare the registration dossier and the dossier to change the household owner when needed.
Advise on the direction to take when the household needs to move to a company model.

The State authority considers and decides on the dossier.

Questions and answers

May a foreigner stand as a household business owner in Vietnam?

No. Article 82 of Decree 168/2025/NĐ-CP allows only Vietnamese citizens with full civil legal capacity to stand as a household business owner. Foreigners who wish to do business in Vietnam carry out enterprise establishment procedures under the Law on Enterprises and the Law on Investment, and do not stand as household owner in the name of a relative who is a Vietnamese citizen.

May a person who already stands for a household business in their home village open another household in the city?

No. Article 83 of Decree 168/2025/NĐ-CP provides that an individual may register only one household business nationwide, regardless of locality. To do business at another location, the household registers a new business location under the same household in accordance with Article 87, rather than establishing a second household.

If a manager is hired to run the business, is the household owner relieved of responsibility for debts?

No. The household owner may hire a manager to manage and operate the business (clause 2, Article 84 of Decree 168/2025/NĐ-CP), but tax obligations, financial obligations and debts arising from the household's activities remain with the household owner and the household members who have given authorization, who are liable with all of their assets (clauses 1 and 3, Article 84). An internal agreement with the manager has no effect against creditors, the tax authority or employees.

May a household business owner contribute capital to open a limited liability company?

Yes. The household owner and household members who registered the household may contribute capital, buy shares or buy a capital contribution in an enterprise as individuals (clause 4, Article 84 of Decree 168/2025/NĐ-CP). The company's member records show the individual's name, not the household business's name, because a household is not a legal entity able to stand as a capital contributor.

May someone standing for a household business also open a private enterprise?

Not at the same time. Clause 5, Article 84 of Decree 168/2025/NĐ-CP provides that a household owner or household member who registered the household may not simultaneously be the owner of a private enterprise, because both models carry liability with all of their assets. To move to a private enterprise, the household must first be terminated or the conversion procedure must be carried out as prescribed.

Legal basis · verification date

Verified 29 September 2026 · next review 29 December 2026. The content is general guidance and does not replace advice for a specific case.

Decree 168/2025/NĐ-CP on enterprise registration (effective 1 July 2025): clause 2, Article 82 (conditions: Vietnamese citizen, civil legal capacity); Article 83 (one person, one household nationwide); Article 84 (rights, obligations and liability of the household owner and household members — clauses 1 and 2 on joint liability and the right to hire management, clause 3 on tax obligations and litigation representation, clause 4 on the right to contribute capital as an individual, clause 5 on not simultaneously being a private enterprise owner).