Corporate Income Tax exemption and reduction in Vietnam

Hi DMS Law office in Vietnam! Could you advise me about the Corporate Income Tax exemption and reduction period in Vietnam ? 

Hi!

Corporate Income Tax (CIT) incentives:

Tax incentives are granted to new investment projects based on encouraged sectors, encouraged geographical areas and the size of projects.

CIT incentives include preferential tax rates, tax exemption and reduction periods.

Tax exemption and reduction period in Vietnam:

There are three types that a taxpayer may be eligible for tax exemption and reduction, as follows:

Tax exemption for 4 years and 50% reduction of the tax payable for 9 subsequent years are applicable to: incomes of enterprises from the implementation of new investment projects specified in Clause 1, Article 19 of Circular No.78/2014/TT-BTC (amended, supplemented in Clause 1 Article 11 of this Circular); incomes of enterprises from the implementation of new investment projects in the socialized fields in geographical areas with difficult or particularly difficult socio-economic conditions specified in the Appendix to Decree No. 218/2013/ND-CP.

Tax exemption for 4 years and 50% reduction of the tax payable for 5 subsequent years are applicable to: incomes of enterprises from the implementation of new investment projects in the socialized fields in geographical areas outside the list of those with difficult or particularly difficult socio-economic conditions specified in the Appendix to Decree No. 218/2013/ND-CP.

Tax exemption for 2 years and 50% reduction of the tax payable for 4 subsequent years are applicable to: the implementation of new investment projects specified in Clause 4, Article 19 Circular No.78/2014/TT-BTC and incomes of enterprises from the implementation of new investment projects in industrial zones (except industrial zones in geographical areas with favorable social-economic conditions).

Counting for tax exemption or reduction period:

The tax exemption or reduction duration specified in this Article shall be counted consecutively from the first year an enterprise has taxable income from a new investment project eligible for tax incentives. If an enterprise has no taxable income for the first 3 years, counting from the first year it has revenue from a new investment project, the tax exemption or reduction duration shall be counted from the fourth year (Article 20, Circular No. 26/2015/VBHN-BTC, dated September 14, 2015).

Related topics:

Corporate Income Tax (CIT) rates in Vietnam.

Responsibility to submit VAT declaration in Vietnam

Conditions for input VAT deduction

Consulting services:

Phone: 0914 165 703 or email: dmslawfirm@gmail.com

CIT exemption and reduction period in Vietnam