Knowledge base

A company asked whether loan interest paid by Kyoei Steel Vietnam Co., Ltd. to Japan's JBIC bank between July 2014 and October 2018 qualifies for corporate income tax (foreign contractor withholding tax) exemption under the Vietnam-Japan Double Taxation Avoidance Agreement. The Ministry of Finance response states that this specific case was already addressed by the former Ninh Binh Provincial Tax Department in Official Letter No. 4448/CT-TTKT3 dated December 5, 2019, and advises the company to compare that letter's guidance against its actual case file and documentation before applying the exemption. The response also flags the treaty benefit eligibility rule under Clause 1, Article 6 of Circular 205/2013/TT-BTC: tax authorities will refuse to apply treaty relief in certain situations, including when a taxpayer requests treaty benefits for tax that arose more than three years before the request date. Businesses with foreign loans or other cross-border income should keep this three-year window in mind when filing for treaty-based tax relief.

The Ministry of Finance issued Q&A guidance on personal income tax (PIT) obligations for a real estate deal carried out through a power-of-attorney contract. Individual A held land-use rights but had not yet received the certificate, so A granted individual B full authority to dispose of the land; after B helped A obtain the certificate, B, acting on A's behalf, signed a gift contract transferring the land to individual C, who is B's wife. Citing Official Letters 1133/TCT-TNCN, 3373/TCT-TNCN, and 3438/TCT-PC (dated August 5, 2024), the Ministry held that when a power-of-attorney contract grants the attorney-in-fact full rights of possession, use, and disposal under the Civil Code, the arrangement is treated as a real estate transfer between the grantor (A) and the attorney-in-fact (B), even without a separate written transfer contract. As a result, A must declare and pay 2% PIT on the transfer value. On the subsequent gift from B to C, gifts of real estate between spouses are exempt from PIT under Clause 4, Article 4 of the PIT Law, so C does not owe the 10% gift-receipt PIT provided the marital relationship is properly documented. If C is not B's lawful spouse, both A and C would owe PIT simultaneously. Using a power of attorney to dispose of property is a common practice in Vietnam when land certificates are pending, so this guidance is a practical reference for individuals, investors, and accountants: tax authorities examine the substance of the contract - whether it grants all three rights of possession, use, and disposal - rather than its outward label.

The Ministry of Finance issued an official response clarifying how deductible input VAT should be reflected in project investment settlement reports prepared on Form 01/QTDA under Decree 193/2026/ND-CP. Under Article 4 and Clause 2, Article 3 of Decree 193/2026/ND-CP, settled investment capital covers all lawful costs incurred within the approved project scope, budget estimate, and signed contracts. Citing Clause 2, Article 9 of Corporate Income Tax Law No. 67/2025/QH15 and Points dd and e, Article 14 of VAT Law No. 48/2024/QH15, the Ministry confirmed that for businesses paying VAT under the deduction method, input VAT that is creditable or has been refunded must NOT be included in the value of fixed assets, investment costs, or deductible expenses for corporate income tax purposes. Because Form 01/QTDA attached to Decree 193/2026/ND-CP has no separate line item for deductible VAT, project owners preparing settlement reports must determine the proposed settled investment capital value excluding any input VAT that is creditable or refundable under tax law. This is an interpretive application of existing law rather than a new rule, but it carries practical significance for project owners and project accountants compiling settlement dossiers.

A resident of Hung Yen province asked the Ministry of Finance how land use fees are calculated when a Land Use Right Certificate (LURC) is issued for encroached land under Article 139 of the 2024 Land Law. The specific question: if, before applying for the LURC on the violating area, the land user had already been recognized as having land use rights, or had been allocated land (or had received a transfer of state-allocated land for which a fee was paid) at an earlier point, should that already-recognized or already-allocated area be deducted when calculating the land use fee owed on the encroached portion. In response, the Tax authority (Sub-department 9, Hung Yen Provincial Tax Department) cited Point a, Clause 3, Article 139 of the 2024 Land Law and Point a, Clause 3, Article 11 of Decree 103/2024/ND-CP: for households and individuals who used land from October 15, 1993 to before July 1, 2004 and are now issued a residential-purpose LURC, the land use fee for the area within the local residential land allocation limit is the certified area within that limit, multiplied by the residential land price on the local price table, multiplied by 30 percent. However, the Tax authority did not directly answer whether previously recognized or allocated area should be deducted. The reply states that the Tax authority only receives an information transfer slip electronically from the land management agency to determine the financial obligation and issue a payment notice; determining the plot's location, allocation limit, and legal status - including whether previously recognized or allocated area should be netted out - is outside the Tax authority's jurisdiction. The inquirer was told to contact the land management agency directly for specific guidance. For SME owners or individuals holding land with an encroachment history, or currently applying for a certificate covering a previously unauthorized portion, the practical takeaway is that the final land use fee depends on figures the land registration office determines and transfers to the Tax authority, not on an independent Tax authority calculation. Businesses should work directly with the local land management agency to clarify any area deduction before receiving a payment notice from the Tax authority.

This is a draft law still in the drafting stage, led by the Ministry of Agriculture and Environment, intended to amend and supplement provisions across 10 existing laws related to administrative procedures and business conditions in the agriculture and environment sectors. The National Assembly's Science, Technology and Environment Committee is responsible for reviewing the draft. The draft is expected to be submitted to and passed at the National Assembly's 16th term Special (extraordinary) Session. At this stage, the available material only covers the legislative status (drafting agency, reviewing committee, expected timeline) and does not yet include the substantive text of the proposed amendments, so a detailed business impact assessment is not possible. Businesses operating in agriculture and environment-related sectors should track this draft as it may change business licensing conditions and administrative procedures for the industry. However, the draft does not directly concern tax, accounting, e-invoice, labor, or customs obligations.

A company asked the tax authority how to determine the personal income tax (PIT) residency status of a foreign employee transferred by the parent company to work in Vietnam starting September 15, 2025. The employee already holds a work permit and a temporary residence card. Earlier, the employee made a short entry into Vietnam (March 14 to 18, 2024) to attend a family wedding, with no work performed and no income earned during that visit. The company wanted to know whether the employee qualifies as a tax resident for 2025, whether the employee can authorize the company to finalize PIT on their behalf, and whether the short 2024 visit affects the residency determination. Based on Circular 111/2013/TT-BTC and Decree 126/2020/ND-CP, the tax authority answered that an individual is a Vietnam tax resident if present in the country for 183 days or more within a calendar year, or for 183 days or more within any 12 consecutive months from the first day of presence. The paying company must determine residency by checking the employee's actual passport entry and exit stamps against the labor contract or assignment letter. For the scenario described, the tax authority did not issue a specific residency conclusion for this individual. Instead, it directed the company to determine the employee's residency status itself, based on the employee's actual passport entry and exit stamps compared against the labor contract or assignment letter.

This is a draft law amending Article 6 and Appendix IV of the Investment Law, which govern the List of Conditional Business Investment Lines. The drafting agency is the Ministry of Finance, and the reviewing body is the National Assembly's Economic and Financial Committee. The draft is expected to be submitted to and passed at the First Extraordinary Session of the 16th National Assembly. This filing marks only the early stage of the legislative process; beyond the title and procedural details above, no specifics have yet been published on which business lines will be added, removed, or have their conditions revised. Businesses, particularly foreign-invested enterprises and companies operating in conditional business sectors, should track this draft closely. Any change to the List of Conditional Business Investment Lines could directly affect sub-licensing requirements, investment registration certificates (IRC), and ongoing compliance obligations once the amended law is formally issued.

This is a consolidated circular issued by the Ministry of Industry and Trade (MOIT) on August 3, 2026, merging Circular No. 12/2018/TT-BCT (detailed rules implementing the Law on Foreign Trade Management and Decree 69/2018/ND-CP) with six subsequent amending circulars (42/2019, 08/2023, 38/2025, 15/2026, 26/2026, and 41/2026/TT-BCT) into one up-to-date text. It applies to Vietnamese traders and organizations/individuals engaged in foreign trade activities. The main content covers: (1) a detailed HS-code list of used consumer goods, medical devices, and vehicles banned from import; (2) application forms and procedures for licenses commonly needed by import-export businesses - Certificate of Free Sale (CFS), temporary-import re-export business licenses, cargo transit permits, and licenses to manufacture or export military uniforms; (3) rules on import tariff-rate quota goods - refined and raw sugar, salt, raw tobacco material, and poultry eggs - including which agency sets the annual quota (by November 15), eligibility to apply, required documents, the 10-working-day processing timeline, and quarterly reporting obligations. Businesses should note this consolidated text is for reference purposes only and does not itself create new legal obligations - it simply compiles provisions that took effect at various earlier dates (the newest constituent provisions, from Circular 41/2026/TT-BCT on the scrap-materials and used-goods list subject to a temporary-import ban, took effect September 5, 2026). It is a useful single reference for import-export, temporary-import re-export, and transit-trade businesses to see the full current set of rules in one place.

Decree No. 20/2026/ND-CP (implementing National Assembly Resolution No. 198/2025/QH15 on private-sector economic development) grants small and medium-sized enterprises (SMEs) registering a business for the first time a 3-year corporate income tax (CIT) exemption starting from the date their Enterprise Registration Certificate is first issued. The exemption does not apply, however, to enterprises newly formed through merger, consolidation, division, split, or a change of owner or entity type, or when the new enterprise's legal representative, general partner, or highest capital contributor previously held the same role in another enterprise that is still operating or was dissolved less than 12 months earlier. A business owner asked the Ministry of Finance about a specific situation: he is simultaneously the Director of a newly established single-member LLC and holds 50% of the charter capital (tied with the other member) in a separate, operating two-member LLC. He wanted to know whether this 50/50 stake would disqualify the new company from the exemption, and whether transferring the entire 50% stake to someone else would restore eligibility for the remaining incentive period. Rather than answering the specific scenarios directly, the Ministry of Finance simply quoted the text of Clause 3, Article 7 of Decree 20/2026/ND-CP and advised the taxpayer to compare the facts against it and contact the directly managing tax authority for case-specific guidance. The takeaway for owners with overlapping stakes across multiple companies: carefully review each related enterprise's legal representative, general partner, or highest-capital-contributor role before setting up a new company, since an overlap can forfeit the 3-year CIT exemption.

The Ministry of Finance's Department of Tax, Fee and Charge Policy Management has answered a business's questions on how to declare the environmental protection (EP) fee on wastewater under Decree No. 346/2025/ND-CP, covering three scenarios: a shipbuilding facility with both industrial and domestic wastewater, a pig farm, and a pearl farming and processing export facility. Under Article 2 of Decree 346/2025/ND-CP, the fee applies to industrial wastewater (all wastewater discharged by production, business, or service establishments, excluding the portion classified as domestic) and domestic wastewater (household-type wastewater, wastewater from businesses in trade or service categories managed as domestic under the technical standard, or wastewater under 20 m3 per day where clean tap water is used). A business generating both types, like the shipbuilding facility, must classify and declare each stream separately under these rules. Notably, wastewater from aquaculture activities, including pearl-mussel farming, is exempt from the EP fee under Clause 10, Article 5, regardless of the water source used. For technical questions on classifying wastewater or determining what counts as aquaculture (including the pig farming case), the Ministry of Finance directs businesses to the Ministry of Agriculture and Environment for specific guidance.

Many construction firms and other businesses pay workers under lump-sum or piece-rate labor contracts, but have struggled to determine the wage base for mandatory social insurance (SI) contributions because the worker's actual monthly income fluctuates and is only known after the month ends. Responding to a business inquiry, Vietnam Social Insurance cited Clause 1, Article 7 of Decree 158/2025/ND-CP and Circular 10/2020/TT-BLDTBXH, clarifying that for employees paid by product or lump-sum wages, the labor contract must state a time-based (monthly) wage rate that is used to calculate the product or lump-sum unit price. It is this contracted time-based rate, not the fluctuating amount actually paid each month, that forms the basis for calculating mandatory SI contributions, together with any allowances and other additions that have a specific, stable, and regularly paid amount (excluding portions that vary with productivity or output). In practice, this means businesses should agree on and record a time-based wage rate in the labor contract from the outset, rather than waiting until month-end actual income is known before calculating SI contributions. Doing so helps employers avoid late, over-, or under-payment of monthly SI contributions for staff working under lump-sum or piece-rate arrangements.

An employee discovered she had unknowingly been issued two personal tax codes (MST), with no clear reason for the duplication. When her company finalized her personal income tax (PIT), her two registered dependents (NPT) turned out to be linked to the second tax code, while the finalization itself was processed under the first tax code. She was concerned this might disqualify her from the family circumstance (dependent) deduction for those two dependents. Responding, the Thai Nguyen Provincial Tax Department cited Clause 4, Article 37 of Circular No. 90/2026/TT-BTC dated 30 June 2026 issued by the Ministry of Finance on tax registration: an individual who has been issued more than one tax code must update the personal identification number information for all tax codes issued, so the tax authority can consolidate the codes under that personal ID number and unify the taxpayer's tax data accordingly. Once the tax codes are merged, invoices, documents, and tax records previously issued using any of those tax codes remain valid for tax administrative procedures and for proving fulfillment of tax obligations, without needing to be reissued under the personal ID number. In other words, once the two tax codes are consolidated under the same personal identification number, dependent information declared under the second tax code is still recognized as belonging to the same employee. The tax authority also referenced Official Letter No. 3422/CT-NVT dated 27 May 2026 from the Tax Department (with Appendix 01), which provides detailed instructions on how to check tax code status and update personal identification numbers, and advised the taxpayer to follow that guidance to ensure the dependent deduction is not affected.