On June 18, 2021, the Ministry of Finance of Vietnam issued Circular 45/2021/TT-BTC stipulating guidelines for the application of the Prior Agreement on Taxable Price Determination (APA) mechanism in tax administration with enterprises having associated transactions.
According to the Circular, transactions proposed to apply APA are associated transactions in Vietnam specified in Clause 2, Article 1 of Decree 132/2020/ND-CP, including:
- Related party transactions covered by this Decree comprise such transaction activities as purchase, sale, bartering, renting, leasing out, borrowing, lending, transfer or disposal of commodities, provision of services in Vietnam;
- Financial borrowing, lending, financial services, financial guarantee and other financial instruments in Vietnam;
- Purchase, sale, bartering, renting, leasing out, borrowing, lending, transfer or disposition of tangible assets, intangible assets and agreement on purchase, sale and sharing of resources such as assets, capital, labor and sharing of costs between related parties, except business transactions in goods and services subject to price adjustments that the State makes under laws on prices in Vietnam.
Vietnam's Circular 45/2021/TT-BTC takes effect from August 3, 2021 and replaces Vietnam's Circular 201/2013/TT-BTC.
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