Full Update on Non-Deductible Expenses for CIT Calculation in 2018

Word file deductible and non-deductible expenses for CIT calculation

The expenses are updated according to the amendments in Circular 25/2018/TT-BTC including:

- In the case of an enterprise transferring capital and assets, the transferee enterprise can only depreciate the fixed assets into deductible expenses for the transferred assets that meet depreciation conditions based on the residual value in the accounting books of the transferor enterprise;- Non-deductible for expenses exceeding 3 million VND/month/person (the old regulation was 1 million VND) to: Contribute to the voluntary retirement fund, purchase voluntary retirement insurance, life insurance for employees; the excess amount over the legal provisions on social insurance, health insurance to contribute to social security funds (mandatory supplementary social insurance, health insurance fund and unemployment insurance fund for employees);- Salaries and bonuses for employees are non-deductible if not specified in the conditions and entitled amounts in one of the following documents: Labor contract; Collective labor agreement; Financial regulations of the Company, Corporation, Group; Reward regulation stipulated by the Chairman of the Board, General Director, Director according to the company's financial regulations;- Deductible for welfare expenses directly for employees such as: funeral, wedding expenses for the employee and their family; vacation expenses, treatment assistance; support for supplementary education at training institutions; support for employees’ families affected by natural disasters, wars, accidents, illness; reward for employees' children with good academic achievements; travel expenses for holidays and Tet for employees; accident insurance, health insurance, other voluntary insurance for employees (excluding expenses for life insurance for employees, voluntary retirement insurance for employees as guided in Point 2.11 Clause 2 Article 6 of Circular 96/2015/TT-BTC) and other welfare expenses. The total welfare expenses mentioned above should not exceed the average one-month salary actually implemented in the tax year of the enterprise.

Other legal bases for determining deductible and non-deductible expenses for CIT calculation.

- Decree 146/2017/ND-CP;- Circular 96/2015/TT-BTC.

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