• How do enterprises change the accounting period for tax declaration?

According to instructions in Official Dispatch 4065/CT-TTHT in 2017:

Pursuant to Clause 1a, Article 12 of the Law on Accounting 2015 stipulates:

“1. Accounting periods include annual accounting periods, quarterly accounting periods, and monthly accounting periods. To be specific:

a) An annual accounting period is 12 months, from January 01 to the end of December 31. Any accounting unit, because of its difference in organisational structure or operation, that is allowed to begin the annual accounting period on the 1st of the first month of a quarter and end it on the last day of the last month of the next four quarter must notify the finance authority and tax authority.”

       The deadline for submitting tax declaration dossiers is pursuant to clauses 2 and 3, Article 44 of the Law on Tax Administration 2019.

       According to clause 4 Article 3 Circular 78/2014/TT-BTC dated 18/6/2017 of the Ministry of Finance guiding the corporate income tax (CIT)

“4. In case an enterprise converts its CIT period (conversion from calendar year to fiscal year or vice versa), the CIT period of the conversion year must not exceed 12 months.”

      As such, when changing the tax period from the calendar year to the fiscal year, the enterprise is responsible for notifying the direct Tax Authority in writing.

• What taxes do foreign-invested enterprises have to pay?

According to regulations, annually, foreign-invested enterprises shall pay four types of taxes:

License fees (Article 2 of Decree 139/2016/ND-CP)

Corporate Income Tax (Article 2 of Decree 218/2013/ND-CP)

Value Added Tax (Article 4 of the Law on Value Added Tax)

Personal Income Tax (Article 2 of the Law on Personal Income Tax).

In addition, depending on the business line that the enterprise registers, the law also stipulates other taxes, such as Special Consumption Tax and Import-Export Tax,...

• When is the deadline for paying the license fee?

Under clause 9, Article 18 of Decree 126/2020/ND-CP stipulates as follows:

- The deadline for paying license fees is January 30 annually.

Thus, the deadline for paying the 2024 license tax is no later than January 30, 2024, .

• How many methods are there to calculate value-added tax (VAT)?

Under Article 9 of the Law on Value Added Tax 2008, there are 02 VAT calculation methods and tax declaration dossier:

- Deduction method: Applicable to business establishments that fully implement the accounting, invoice and document regimes according to the provisions of the law on accounting, invoices and documents.

+ VAT declaration Form No. 01/GTGT, 02/GTGT.

+ Taxpayers with investment projects are eligible for VAT refunds.

- Direct method (on revenue): The amount of VAT payable is equal to the percentage multiplied by revenue.

+ VAT declaration Form No. 04/GTGT.

+ Table of ratios on revenue specified in Circular 219/2013/TT-BTC.

• How many periods are required to declare value-added tax (VAT)? Can enterprises choose when to declare value-added tax?

- VAT declaration by month:

+ Subjects:

- VAT payers with total revenue from selling goods and providing services in the preceding year of over 50 billion VND;

- Taxpayers choose to declare VAT monthly.

- Quarterly VAT declaration:

+ Subjects:

- Taxpayers with total revenue from sales and service provision of the preceding year ≤ 50 billion VND choose to declare VAT quarterly;

- Taxpayers who have just started production and business activities choose to declare taxes quarterly.

- Deadline for submitting tax declarations: Clause 1, Article 44 of the Law on Tax Administration.

        Regarding the selection of tax declaration period, pursuant to point a clause 1, Article 9 of Decree 126/2020/ND-CP, enterprises that have just started production and business operations can choose to declare VAT quarterly. After operating for 12 full months, from the next calendar year to the year that has completed 12 months, based on the revenue level of the previous calendar year (total 12 months), to declare monthly or quarterly.

• When is the deadline for paying corporate income tax?

According to Clause 1, Article 55 of the Law on Tax Administration 2019, the deadline for paying corporate income tax, which is paid quarterly, is the 30th of the first month of the next quarter.

Besides, clause 1 Article 1 Decree 91/2022/ND-CP regulates as follows:

    “. In case the expiration date of any of these time limits is a statutory day off, the expiration date will be the working day succeeding the day off.”

• What new investment projects are eligible for corporate income tax (CIT) incentives (CIT rate of 10% for 15 years, tax exemption for four years, reduction of 50% of tax payable for the next nine years)? What are the conditions for the application of tax incentives?

       1. According to Clauses 1, 2 and 3, Article 16 of Decree 218/2013/ND-CP (amended by Clause 16, Article 1 of Decree 12/2015/ND-CP and Clause 6, Article 1 of Decree 91/2014/ND-CP), new investment projects enjoy CIT incentives as follows:

- New investment projects in areas with extremely difficult socio-economic conditions, Economic Zones, and High-tech Zones, including concentrated information technology zones, are established under the Prime Minister's Decision.

- New investment projects in the field scientific research and technological development; high technology application; investment in construction and business of high-tech incubators; investment in developing water plants, power plants, water supply and drainage systems; bridges, roadway, railway; airports, seaports, river ports... and infrastructure that shall be decided by the Prime Minister; production of software products, composite materials, light construction materials, and rare materials; production of renewable energy, clean energy, energy from waste destruction; biotechnology development.

- New investment project in the field of environmental protection;

- Income of high-tech and agricultural enterprises applying high technology according to the Law on High Technology provisions.

- New investment projects in the manufacturing sector (excluding projects producing products subject to special consumption tax, mineral mining projects) with initial registered investment capital of at least 6 (six) trillion VND, disbursed no more than three years after the issue of investment license and satisfy one of the following two criteria:

+ Have a minimum total revenue of 10 (ten) trillion VND/year no later than three years from the investment project's revenue year.

+ Regularly employ over 3,000 employees no later than three years from the investment project's revenue year.

- Investment projects in the manufacturing sector (except for projects producing products subject to special consumption tax and mineral mining projects) with a minimum investment capital of 12 (twelve) trillion VND, and the technology used for which are assessed according to the Law on High technology, the Law on Science and Technology, registered capital which is disbursed within 05 years from the day on which the investment is licensed as prescribed by regulations of law on investment.- New investment projects that produce products on the List of supporting industrial products prioritised for development meet one of the following criteria:

+ Industrial products supporting high technology;

+ Industrial products supporting production in the following industries: textile - garment; leather - footwear; electronics and IT; automobile production and assembly; mechanical engineering, but as of January 1, 2015, these products have not been produced domestically or meet European Union (EU)’s technical standards or equivalent.

           2. Conditions for application of tax incentives:

- CIT incentives only apply to enterprises that follow the regime for accounting and invoicing and pay tax according to declarations.

- Enterprises enjoying CIT incentives shall only be enterprises with new investment projects/expanded investment projects that meet the prescribed conditions in investment incentive fields or investment incentive areas.

• How are the tax exemption and tax reduction period calculated?

Pursuant to clause 4, Article 16 of Decree 218/2013/ND-CP, the time for tax exemption or reduction specified in this Article is calculated continuously from the first year of assessable income from the new investment projects entitled to the tax incentive. Where there is no assessable income in the first three years, from the first year of assessable income from the new investment project, the time for tax exemption or reduction is calculated from the fourth year.

Incentives shall be applied to the income generated from investment projects recorded on the Investment Registration Certificate that fully and accurately meets the content and criteria (product, scale,...) stated in the Investment Registration Certificate granted for the first time.

• If the enterprise has no taxable income in the first three years, how is the tax exemption or reduction period calculated?

Pursuant to clause 4, Article 16 of Decree 218/2013/ND-CP, Where there is no assessable income in the first three years, from the first year of assessable income from the new investment project, the time for tax exemption or reduction is calculated from the fourth year a new investment project generates revenue.

• How do FDI enterprises enjoy investment incentives compared to domestic enterprises?

Pursuant to Article 15 of the Law on Investment 2020 regulating forms and subjects for applying investment incentives,  investment incentives are applied depending on the business lines, location of the investment project, and other content of the project, but not depending on whether the project has foreign capital or not. Enterprises with foreign capital are still entitled to investment incentives according to the law if having investment projects that meet the conditions for investment incentives. Depending on the scale and characteristics of the investment project, such investment projects can enjoy corresponding incentives such as corporate income tax incentives, land rents, export tax, import tax, and credit incentives...