Vietnam: Corporate tax incentives; interest-free loans; foreign contractor tax

Vietnam: Corporate tax incentives; interest-free loans

“Official letters” and other releases issued by the tax authorities in Vietnam provide the following guidance:

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  • Corporate income tax incentives apply to income from deposit interest and lending interest of a company entitled to incentives based on the “location” condition.
  • A “capital lending” interest-free contract, between a company and an individual, is not in accordance with the market price standard and is subject to tax.
  • Customer services and debt monitoring services conducted in Vietnam but provided to a foreign company are subject to value added tax (VAT).
  • Updated VAT guidance concerning price management, charges, fees, and invoices was issued.
  • Mandatory nursing insurance contributions made overseas are deductible for individual (personal) income tax purposes.
  • The “foreign contractor tax” applies with respect to loan guarantees, and also applies for surcharges of foreign sea carriers and sales transactions with bonded warehouses.


Read a July 2016 report [PDF 178 KB] prepared by the KPMG member firm in Vietnam: Technical Update

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