What are the regulations on exemption from corporate income tax, personal income tax in Ho Chi Minh city under the Decree 11/2024/ND-CD?
- What are the regulations on exemption from corporate income tax, personal income tax in Ho Chi Minh city under the Decree 11/2024/ND-CD?
- Shall organizations generating revenues from transfer of capital, right to capital contribution to business start-up enterprises in Ho Chi Minh City be eligible for CIT exemption?
- Shall individuals generating revenues from transfer of capital to business start-up enterprises in Ho Chi Minh City be eligible for PIT exemption?
What are the regulations on exemption from corporate income tax, personal income tax in Ho Chi Minh city under the Decree 11/2024/ND-CD?
On February 2, 2024, the Government issued Decree 11/2024/ND-CP on loan interest, fair return, payment methods, settlement of investment projects under BT contracts; exemption from corporate income tax, personal income tax in Ho Chi Minh city
Decree 11/2024/ND-CP elaborates Resolution No. 98/2023/QH15 dated June 24, 2023 of the National Assembly on pilot implementation of specific regulations and policies on Ho Chi Minh City development (hereinafter referred to as “Resolution 98/2023/QH15”), including
- Post-construction interest, fair return, payment methods, settlement of investment projects in Build-and-Transfer contracts (hereinafter referred to as “BT projects”) in Ho Chi Minh City in accordance with Point d Clause 5 Article 4 of Resolution 98/2023/QH15;
- Exemption from corporate income tax (CIT), personal income tax (PIT) in accordance with Point a and Point b Clause 1 Article 8 of Resolution 98/2023/QH15.
Decree 11/2024/ND-CP does not provide for:
- Loan interest during construction phase of BT projects which conforms to construction laws;
- Equity mobilized by investors for implementation of BT project which conforms to Article 77 of the Law on Investment in Public-Private Partnerships.
Decree 11/2024/ND-CP applies to:
- Parties to BT contracts, agencies, organizations, and individuals relevant to investment in BT projects in Ho Chi Minh City.
- Enterprises, agencies, organizations, and individuals relevant to renovation start-up and business start-up in Ho Chi Minh City.
What are the regulations on exemption from corporate income tax, personal income tax in Ho Chi Minh city under the Decree 11/2024/ND-CD? (Image from the Internet)
Shall organizations generating revenues from transfer of capital, right to capital contribution to business start-up enterprises in Ho Chi Minh City be eligible for CIT exemption?
Pursuant to Clause 2, Article 13 of Decree 11/2024/ND-CP, it is stipulated as follows:
Corporate income tax exemption
..
2. During the effective period of Resolution No. 98/2023/QH15, organizations generating revenues from transfer of capital, right to capital contribution to business start-up enterprises in Ho Chi Minh City shall be eligible for CIT exemption for these revenues.
Business start-up enterprises in Ho Chi Minh City under this Clause must meet regulations of People’s Council of Ho Chi Minh City on priority sectors; criteria, conditions, and details of business start-up and renovation operations.
Revenues generated from transfer of capital, right to capital contribution under this Clause mean revenues generated by partial or total transfer of capital, right to capital contribution to business start-up enterprises in Ho Chi Minh City (including merger and acquisition of enterprises), except for revenues generated from the transfer of shares, bonds, fund certificates, and other securities as per the law.
In case of total acquisition of single-member limited liability companies owned by organizations in form of transfer of capital attached to immovable property, CIT shall be declared and paid in accordance with immovable property transfer.
...
Thus, based on the above regulations, during the effective period of Resolution 98/2023/QH15, organizations generating revenues from transfer of capital, right to capital contribution to business start-up enterprises in Ho Chi Minh City shall be eligible for CIT exemption for these revenues.
Shall individuals generating revenues from transfer of capital to business start-up enterprises in Ho Chi Minh City be eligible for PIT exemption?
Pursuant to the provisions of Article 14 of Decree 11/2024/ND-CP, it stipulates as follows:
Personal income tax exemption
1. During the effective period of Resolution No. 98/2023/QH15, individuals generating revenues from transfer of capital, right to capital contribution to business start-up enterprises in Ho Chi Minh City shall be eligible for PIT exemption for these revenues.
Business start-up enterprises in Ho Chi Minh City under this Clause must meet regulations of People’s Council of Ho Chi Minh City on priority sectors; criteria, conditions, and details of business start-up and renovation operations.
Revenues generated from transfer of capital, right to capital contribution under this Clause mean revenues generated by partial or total transfer of capital, right to capital contribution to business start-up enterprises in Ho Chi Minh City (including merger and acquisition of enterprises), except for revenues generated from the transfer of shares, bonds, fund certificates, and other securities as per the law.
In case of total acquisition of single-member limited liability companies owned by individuals in form of transfer of capital attached to immovable property, PIT shall be declared and paid in accordance with immovable property transfer.
2. Determination of revenues generated by transfer of capital, right to capital contribution and declaration to tax authority shall conform to personal income tax and tax administration laws.
Thus, during the effective period of Resolution 98/2023/QH15, individuals generating revenues from transfer of capital, right to capital contribution to business start-up enterprises in Ho Chi Minh City shall be eligible for PIT exemption for these revenues.
LawNet