Vietnam: What does the corporate income tax statement include?

Vietnam: What does the tax statement of corporate income tax include?

Pursuant to point b, clause 3, Article 43 of the Law on Tax Administration 2019, Circular 200/2014/TT-BTC, Circular 80/2021/TT-BTC, Decree 132/2020/ND-CP, the corporate income tax statement dossier includes:

(1) Corporate income tax statement declaration form according to Form No. 03/TNDN issued together with Circular 80/2021/TT-BTC.

(2) Annual financial reports, including:

- Balance sheet (Form B01-DN issued together with Circular 200/2014/TT-BTC);

- Profit and loss statement (Form B02-DNN issued together with Circular 200/2014/TT-BTC);

- Cash flow statement using both direct and indirect methods (issued together with Circular 200/2014/TT-BTC);

- Explanatory notes for financial statements (Form B09-DN issued together with Circular 200/2014/TT-BTC);

(3) Power of attorney to perform procedures if not done by the legal representative.

Additionally, depending on the actual business situation, enterprises must submit additional documents including:

(4) Appendix of Business Operation Results issued together with Circular 80/2021/TT-BTC

- Form 03-1A/TNDN for enterprises in manufacturing, trade, services industries.

- Form 03-1B/TNDN for enterprises in banking, credit sectors.

- Form 03-1C/TNDN for Securities Companies, Investment Fund Management Companies.

(5) Loss Transfer Appendix (Form 03-2/TNDN issued together with Circular 80/2021/TT-BTC).

(6) Appendices for preferential corporate income tax (issued together with Circular 80/2021/TT-BTC):

- Form 03-3A/TNDN for newly established businesses from investment projects, businesses relocating, or new investment projects.

- Form 03-3B/TNDN for businesses investing in new production lines, expanding scale, technology renewal, improving ecological environment, enhancing production capacity (expansion investment).

- Form 03-3C/TNDN for businesses employing ethnic minority workers or businesses in production, construction, transportation employing a large number of female workers.

- Form 03-3D/TNDN for scientific technology enterprises or businesses transferring technology in priority fields.

Attached dossiers when declaring and paying taxes for Vietnamese enterprises investing abroad concerning income from foreign investment projects include:

- A photocopy of the foreign income tax declaration confirmed by the taxpayer;

- A photocopy of the foreign tax payment document confirmed by the taxpayer or an original document from the foreign tax authority confirming the paid tax amount or a photocopy of an equivalent document confirmed by the taxpayer.

Vietnam: What does the corporate income tax statement include? (Image from the Internet)

What are principles for determining the location for corporate income tax payment of enterprises in Vietnam?

According to Article 12 of Circular 78/2014/TT-BTC, the principles for determining the location for corporate income tax payment of enterprises are as follows:

+ Enterprises pay tax at the location of their head office.

+ In the case where enterprises have production facilities (including processing, assembly facilities) that are dependent on financial accounts operating in different provinces or central cities from the location of the head office, the tax is allotted to be paid at both the head office location and the location where the production facility is situated.

+ The above tax allocation does not apply to enterprises with constructions, project components, or construction facilities that are dependent on financial accounts.

What is the current corporate income tax rate in Vietnam?

According to Article 10 of the Enterprise Income Tax Law 2008, as amended and supplemented by clause 6, Article 1 of the 2013 Amendment to the Enterprise Income Tax Law, it is regulated as follows:

Tax rate

1. The corporate income tax rate is 22%, except for cases stipulated in clauses 2 and 3 of this Article and entities entitled to preferential tax rates stipulated in Article 13 of this Law.

Cases subject to the 22% tax rate stipulated in this clause shall switch to a 20% tax rate from January 1, 2016.

2. Enterprises with total annual revenues not exceeding twenty billion dong apply a 20% tax rate.

The revenue serving as a basis for determining whether an enterprise is subject to the 20% tax rate in this clause is the revenue of the preceding year.

3. The corporate income tax rate for activities of searching, exploring, extracting oil, gas, and other precious resources in Vietnam ranges from 32% to 50%, suitable for each project, each business location.

The Government of Vietnam shall specify and guide the implementation of this Article.

Therefore, the corporate income tax rate applied from 2024 for enterprises is 20%.

However, for enterprises involved in searching, exploring, and extracting oil, gas, and other precious resources in Vietnam, the tax rate is from 32% to 50%, appropriate for each project, each business location.

According to Article 10 of Decree 218/2013/ND-CP, further details are provided regarding the tax rate for activities related to searching, exploring, and extracting oil, gas, and other precious resources in Vietnam as follows:

- For activities of searching, exploring, and extracting oil, gas, based on the location, extraction conditions, and reservoir quantities, the Prime Minister of the Government of Vietnam shall decide on the specific tax rate suitable for each project, each business location upon the proposal of the Minister of Finance.

- For resource mines of platinum, gold, silver, tin, tungsten, antimony, gems, rare earths, a tax rate of 50% is applied, or 40% for mines where 70% or more of the area allocated is in socio-economically disadvantaged areas listed as preferential income tax areas according to this Decree.