Law on Tax Administration No. 38/2019/QH14 On 13th June 2019, the National Assembly issued the Law on Tax Administration No. 38/2019/QH14, with some highlighted contents as follows: – Deadline for submitting PIT finalization dossiers is extended: Currently, the deadline for submitting the annual PIT finalization dossiers is the 90th day from the end of calendar year. However, as regulated at Clause 2, Article 44 of the Law on Tax Administration in 2019, this deadline for individuals who directly submit the PIT finalization dossiers to tax office is the last day of the 4th month from the end of the calendar year....



Official Letter No. 38359/CT-TTHT (OL 38359): VAT, CIT (FCT) rates for advertisement on Facebook, Google, CloudFlare OL 38359 dated 27th May 2019 by Hanoi Department of Taxation handles the following case: A company uses advertisement service on Facebook, Google, CloudFlare from oversea network to promote its business. Service fee is paid each time the company uses this service (many times per month) when the service suppliers send them the payment requests. In this case, the company has the responsibility to withhold, declare and pay foreign contractor tax (FCT) on behalf of the service suppliers (foreign contractors) before making payments with...



Official Letter No. 1285/TCT-DNNCN (OL 1285) about the determination of the reduced personal income tax (PIT) for individuals working in the economic zones in 2018 On 8 April 2019, the General Department of Taxation issued OL 1285 with the following content: According to Decree No. 82/2018/ND-CP dated 22 May 2018, the reduced PIT of individuals working in the economic zones, border-gate economic zones for the tax year of 2018 is calculated as follows: Reduced PIT   Total PIT payable in the year   Taxable income that individuals received from their works in the economic zones for the period from 01/01/2018...



Official Letter No. 4079/CT-TTHT (OL 4079): requirement to change depreciation method of fixed assets On 13th March 2019, Binh Duong Department of Taxation issued OL 4079, clarifying the requirement when a company changes the depreciation method of fixed assets as follows: The company itself determines the depreciation method and useful life of fixed assets and informs such information to the tax office before applying the chosen depreciation method. In case the company wants to change the depreciation method of fixed assets which are already in use, the company must explain the reason to change the depreciation method. The depreciation method of...



Official Letter No. 6351/CT-TT&HT (OL 6351): expenses paid for foreign employees without work permit in Vietnam are non-deductible expenses On 15th February 2019, Hanoi Department of Taxation issued OL 6351, which handles the case that a company paid expenses for foreign employees who did not have a valid work permit according to the detailed regulations on Labor Code. According to this OL, such expenses are not deductible expense for corporate income tax purpose. In addition, this OL clarifies that the company is not allowed to deduct input VAT of these expense. Official Letter No. 7335/CT-TT&HT (OL 7335): requirement to inform...



Official Letter No 650/CT-TT&HT (OL 650): Corporate income tax (CIT) policies on overtime expenses, lunch allowance and house rent On 16th January 2019, Binh Duong Department of Taxation issued OL 650 and answered on a specific case with the following content: A company pays overtime salary to its employees. If such overtime is legally allowed according to the labour regulations, the expense is actually paid to employees, and such expense is supported by adequate documents, following prevailing CIT regulations, overtime salary is considered as deductible expense for CIT purpose. In case the Company pays lunch allowance for its employees by cash...



Official Letter No. 23613/CT-TT&HT (OL 23613): VAT refund on returned goods On 28th December 2018, Binh Duong Department of Taxation issued OL 23613 and answered on a specific case with the following content: From 1st February 2018, a Company imported materials for production and paid import tax as well as VAT on these goods. The Company later found that these goods are not in good condition and made an agreement with the oversea supplier to return the goods. In this case, this OL states that the Company shall follow procedures to get refund on VAT for these goods as guided...



Official Letter No. 74289/CT-TTHT (OL 74289): Personal income tax (PIT) treatment of charity activities The OL 74289 issued by Hanoi Department of Taxation on 7th November 2018 answers an inquiry on a case where employees of a company did charity activities, such as donating gifts and money to poor people, disabled individuals and hospitals, and donation was made from employees in the form of salary deduction. This OL states that salary deduction made for charity activities should not be deducted from taxable income of employees for PIT purpose since charitable works are not performed through a charity fund which is...



Official Letter No. 18044/CT-TT&HT (OL 18044): VAT requirement for disposed materials On 3rd October 2018, Binh Duong Department of Taxation issued OL 18044, which handles the case that a company no longer uses materials in stock and intends to dispose these materials. If the materials are imported materials and were not subject to VAT according to Clause 4, Circular No. 219/2013/TT-BTC issued by the Ministry of Finance dated 31st December 2013, when changing the purpose of using these materials, the company should declare and pay VAT for imported goods to the customs office where the company registered the customs declaration...

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