Vietnam: Corporate tax incentives; VAT development | KPMG | GLOBAL

Vietnam: Corporate tax incentives; VAT development updates

Vietnam: Corporate tax incentives; VAT development

The tax authorities in Vietnam issued guidance addressing tax treatment in the following situations:


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  • Guidance (an “official letter”) providing that when a company possesses fixed assets that are used to serve its employees, the expenses associated with the repair and maintenance of such fixed assets are treated as deductible expenses for corporate income tax purposes.
  • An official letter provides that when a company acquires a factory from another company, the company is not allowed to “inherit” the tax incentives related to the factory. Rather, the acquisition is considered an expansion investment project for the corporate income tax incentive determination.


Other guidance from the tax authorities in Vietnam concerns:

  • The value added tax (VAT) declaration for manufacturing projects in supporting industries
  • Transferring project that is partially completed and put into operation, subject to VAT
  • Import VAT of goods, imported for capital contribution, creditable
  • Payment for imported goods by bank transfer to a third-party individual appointed by the seller does not satisfy non-cash payment condition
  • The foreign exchange rate for foreign contractor tax (FCT) calculation purposes
  • The individual (personal) tax treatment of trade discounts, payment discounts, and promotion prizes paid to business individuals 
  • Rules for individuals who are issued a new identity card to update their taxpayer information 


Read a March 2016 report [PDF 153 KB] prepared by the KPMG member firm in Vietnam: Technical Update

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