- HM&P: Vietnam International Law Firm
- HM&P: Vietnam International Law Firm
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Tax
The household business sector is becoming the focus of policy adjustment in the process of improving the tax law system in Vietnam. This region has a large number of subjects, a wide distribution, making a significant contribution to the circulation of goods and services, but at the same time also poses many challenges in tax management. Recent changes, including the adjustment of the taxable revenue threshold to about 1 billion VND/year and the absence of the traditional flat tax mechanism, indicate a shift towards a more transparent management model, based on data and self-declaration obligations of taxpayers.
The Corporate Income Tax (CIT) and Personal Income Tax (PIT) regimes apply to corporate restructuring activities in Vietnam, including mergers, consolidations, splits, and transformations. Tax issues in M&A transactions are a significant challenge for businesses, whether they are in the position of seller or buyer.
The transaction of "transfer of factories in industrial parks" in most cases is considered by the tax authority as income from real estate transfer, even if the contract records "only transfer of factories" – land-attached assets without recording the transaction as the transfer of houses/works attached to land or assets attached to land. This shows that this transaction is still not understood and agreed in the way of implementation between invisible related parties, which has created risks for businesses in the transfer process.
The tax picture for cloud computing services provided across borders is changing drastically in Vietnam. From mid-2025, Vietnam has markedly shifted to the principle of taxation according to the place of consumption, and at the same time strengthened management with digital services through two mechanisms: (1) Foreign suppliers self-register – declare – pay taxes directly on the tax authority's web portal; and (2) deduction, submitted on behalf of the buyer, digital platform or payment intermediary organization in Vietnam.
Tax inspection is an activity of assessing taxpayers' compliance with tax laws, helping tax authorities identify violations. This is a mandatory responsibility of businesses, so overcoming errors in documents, invoices and tax declaration not only helps to avoid arrears and fines but also improves the reputation and stability of business activities. When conducting tax inspections at enterprises, the management agency has pointed out a series of common errors for taxes such as Value Added Tax (VAT), Corporate Income Tax (CIT), Personal Income Tax (PIT) and contractor tax. Common mistakes such as invalid invoice declarations, non-deductible expenses, non-deduction of payable taxes and many other errors, lead to large tax arrears and fines. In this article, we will clarify these errors, and at the same time propose recommendations to help businesses overcome and prevent similar errors in business operations.
The separation of enterprises entails a series of tax procedures and problems, from corporate income tax (CIT), personal income tax (PIT) to the handling of loss carryover, interest expenses, etc. The case of Vinpearl separating Vinpearl Cua Hoi into an independent enterprise is a typical example of the complex tax obstacles that need to be removed when conducting this activity.
According to regulations, enterprises are responsible for declaring and paying personal income tax (PIT) on behalf of employees for income from salaries and wages paid by enterprises. Therefore, enterprises need to carefully prepare to comply with the amended PIT Law 2025 which was passed on December 10, 2025 and takes effect from July 1, 2026 (the amended PIT Law). Particularly, regulations related to income from business, salaries and wages of resident individuals will be applied from the tax period at the beginning of 2026. Within the scope of the article, we share some notable amendments to this Law that affect the operation of enterprises and some solutions that need to be implemented to comply with this adjusted legal framework.
According to the provisions of the Law on Tax Administration, before submitting a dissolution dossier, the enterprise must be issued a notice by the tax authority certifying that the enterprise has carried out tax procedures and fulfilled tax payment obligations as prescribed. In fact, enterprises still face many difficulties when the competent authority conducts this procedure. In some cases, the tax authority shall carry out the tax inspection at the head office of the enterprise at the time of dissolution procedures. This is one of the reasons leading to the delay in business dissolution procedures at the business registration office.
In the flow of Vietnam's tax policy reform to respond to the rapid movement of Vietnam's economy, Decree 320/2025/ND-CP (Decree 320) was born as an important "link" to complete the legal architecture of corporate income tax. Not only stopping at the role of guiding the implementation of the Law on Corporate Income Tax 2025, this Decree also marks an important step in tax administration activities, when replacing the old guiding frameworks such as Decree 218/2013/ND-CP and other guiding documents. Decree 320 was issued and takes effect from December 15, 2025.
In the context of a thriving globalization economy and cross-border trade, digital transformation has become an inevitable trend in public governance in Vietnam. The Law on Tax Administration 2025 was approved by the National Assembly on December 10, 2025 and will take effect from July 1, 2026 in the spirit of comprehensively renovating tax administration activities. The new regulations are expected to help the State combat tax revenue loss, implement the requirements of transparent, modern, and international standard management. At the same time, these regulations can help businesses reduce compliance costs, optimize the time to declare and submit tax documents, and facilitate the expansion of production and business.
The adjustment of tax policies for business households and individuals is always a brainstorming problem for policymakers: it must ensure fairness, avoid creating a burden on vulnerable groups, and at the same time not erode sustainable revenue for the budget. In the context that Vietnam is promoting the process of tax transparency, modernizing management and encouraging digitalization, raising the tax exemption threshold for business households to 500 million VND/year is considered a concession step to reduce financial pressure, encourage the legalization of operations and create room for business households to reinvest . However, the "simplification" with a common number raises many practical issues that need to be discussed. Is the threshold of 500 million VND, if applied "mechanically", suitable for the characteristics of the industry, household structure and regional differences, or is it necessary to have complementary mechanisms for the policy to achieve the desired effect?
For FDI enterprises, determining corporate income tax obligations arising from the transfer of contributed capital is always a big challenge, especially when tax authorities and enterprises have different interpretations of tax bases, exchange rates, and regulations on administrative procedures.
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