Decree 218: Regulating 15 income subject to enterprise income tax in Vietnam

According to Article 3 of Decree No. 218/2013/NĐ-CP of Vietnam’s Government, 15 taxable income include:

1. The taxable income includes income from the business and production activities of goods and services and other income specified in Clause 2 of this Article. For enterprises registering business and having income specified in Clause 2 of this Article, this income is determined as the one coming from the business and production activities of the establishment;

2. Income from capital transfers includes income from the transfer of a part or whole of the capital invested in the enterprise, including the sale of enterprise, transfer of stock or transfer of capital contribution rights and other forms of transfer of capital as prescribed by law;

3. Income from transfer of investment projects, income from the transfer of the right to participate in investment projects, income from the transfer of rights to explore, extract and process minerals prescribed by law; income from transfer the real estate as stipulated in this Decree;

4. Income from the right to use and own property including income from the intellectual property rights, income from technology transfer under the provisions of law;

5. Income from transfer, lease or disposal of property (excluding real estate), which contains other valuable papers;

6. Income from interest from deposit and interest from loan and trading of foreign currency includes: Interest from deposit at credit institutions, interest from loans in any form as prescribed by law, including deferred interest, interest paid installments, fees of credit guarantee and other fees in the contract of loan; income from trading of foreign currency; exchange rate difference from revaluation of liabilities payable in foreign currency at the end of fiscal year; exchange rate difference arising in the period (for exchange rate difference arising during the basic construction investment to form the fixed assets of newly-established enterprises but these fixed assets have not been put into the business and production activities, the guidance of the Ministry of Finance shall apply). For debts receivable and loan in foreign currency arising in the period, the exchange interest difference of debts receivable or loan is the difference between the exchange rate at the time of debt collection with the exchange rate at the time of recording of debts receivable or initial loan;

7. Deductions advanced as expenses which are not used or have not been used up in the period of deduction are not accounted by enterprises to adjust for reducing expenses;

8. Debts written off now recovered;

9. Liabilities payable without identifying creditors;

10. Income from the business of the previous years omitted now discovered;

11. The difference between the collection of penalty or compensation for breach of economic contract or bonus from good performance of commitments (excluding the fines or compensation is reduced in the value of works during the investment period) minus (-) the penalty or compensation due to breach of contract as prescribed by law;

12. The grants in cash or in kind received;

13. Differences from revaluation of assets as prescribed by law to contribute capital or transfer upon splitting, merger, consolidation or conversion of business type;

14. Income received from business and production activities outside Vietnam;

15. The other incomes including Exempt income specified in Clause 6, Clause 7, Article 4 of this Decree.

View more details at Decree No. 218/2013/NĐ-CP of Vietnam’s Government, effective from February 15, 2014.

Ty Na

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