Law 14/2008/qh12: Corporate Income Tax

Original Language Title: Luật 14/2008/QH12: Thuế thu nhập doanh nghiệp

Subscribe to a Global-Regulation Premium Membership Today!

Key Benefits:

Subscribe Now for only USD$20 per month, or Get a Day Pass for only USD$4.99.
The enterprise income tax law _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ pursuant to the Constitution of the Socialist Republic of Vietnam in 1992 was revised, some additional articles by resolution No. 51/2001/QH10;
Congress enacted the law on enterprise income tax, chapter I GENERAL PROVISIONS article 1. Scope this law regulates the taxpayer, taxable income, the income tax exemption, tax base, tax calculation method and the enterprise income tax incentives.
Article 2. The taxpayer 1. The corporate income tax is the active organization of production, trading goods, services are taxable according to the provisions of this law (hereinafter enterprise), including: a) the enterprises is established under the provisions of the law of Vietnam;
b) enterprise was established under the provisions of the law of foreign countries (hereinafter referred to as foreign enterprises) have permanent basis or without resident establishments in Vietnam;
c) organization established by the law on cooperatives;
d) unit was established under the provisions of the law of Vietnam;
DD) Organization has other manufacturing operations, business income.
2. taxable income business prescribed in article 3 of this law must submit corporate income tax as follows: a) the business is established under the provisions of the law of Vietnam tax for taxable income arising in Vietnam and taxable income arising outside of Vietnam;
b) foreign enterprises have permanent establishments in Vietnam pay tax for taxable income arising in Vietnam and taxable income arising outside of Vietnam concerning the operation of permanent establishments;
c) foreign enterprises have permanent establishments in Vietnam pay tax for taxable income arising in Vietnam that this income is not related to the operation of permanent establishments;
d) foreign enterprises without resident establishments in Vietnam pay tax for taxable income arising in Vietnam.
3. permanent establishments of foreign enterprises is the production base, the business that through this facility, foreign business conduct part or all of the works produced, the Vietnam business income, including: a) branch, administrative offices, factories, public transport vehicles, yard , mines, oil, gas or other natural resources exploited in Vietnam;
b) location of construction, building construction, installation, Assembly;
c) facility provides services, including consultancy services through employees or an organization, the other individual;
d) agent for foreign enterprises;
DD) Vietnam representative in the case of the authorized representative to sign contracts on foreign enterprises or representative has no authority to sign contracts on foreign enterprises but often make the delivery of goods or the provision of services in Vietnam.
Article 3. Taxable income of 1. Taxable income includes income from production and business operations of goods, services and other income specified in item 2 of this Article.
2. other income includes income from the transfer of capital, the transfer of real property; income from ownership, the right to use the property; income from transfer, leasing, liquidation of assets; income from interest on deposits, loans, sale of foreign currency; complete the enter your account backup; currency debt already clear now claims to be; currency liabilities not identified; earnings from the business of the year before being abandoned and the other income, including income received from trading activities outside Vietnam.
Article 4. Tax-exempt income 1. Income from cultivation, animal husbandry, aquaculture of the Organization to be established under the law on cooperatives.
2. Income from the realization of technical services directly serves agriculture.
3. Income from the realization of contracts on scientific research and technological development, the product is in trial production period, products made from the new technology was first applied in Vietnam.
4. Income from production and business operations of the goods or services of the business dedicated to labor is disabled, the following detoxification, people infected with HIV. Government regulations specify eligibility criteria, the business is dedicated to disabled people, who after the Detox, people infected with HIV.
5. Income from job-training reserved for ethnic minorities, the disabled, children in particularly difficult circumstances, the object of social ills.
6. The revenue to be divided from the capital contribution activities, joint ventures, associated with the business in the country, after the corporate income tax according to the provisions of this law.
7. Grants received for use in educational activities, scientific research, culture, art, charity, humanitarian and other social activities in Vietnam.
Article 5. Tax period 1. Enterprise income tax-calculation period is determined according to the calendar year or fiscal year, except in the case specified in clause 2 of this Thing.
2. the enterprise income tax period under each incurred income applicable to foreign enterprises are defined in points c and d item 2 article 2 of this law.
Chapter II BASE and TAX CALCULATION METHODS article 6. Base tax tax base tax and income tax.
Article 7. Determine the tax income of 1. Tax income in the tax period is determined by income tax exempt income and subtract the losses was the move from the previous year.
2. taxable income equal to revenue minus expenses deduction of production activities, business plus other income, including income received outside Vietnam.
3. Income from property transfer operations are determined to declare tax.
The Government detailing and guiding the implementation of this Article.
Article 8. The sales revenue of the entire sales, money money money, machining services, subsidies, surcharges, additional businesses enjoy. Sales in Vietnam; the case of the revenue in foreign currency foreign currency exchange to Vietnam the average transaction rate on the inter-bank foreign currency market by the State Bank of Vietnam announced at the time of incurring the revenue in foreign currency.
The Government detailing and guiding the implementation of this Article.
Article 9. The expenses are deducted and not deducted in determining taxable income 1. Except expenses specified in item 2 of this article, except for any business expenses if it meets the following conditions: a) the actual expenses incurred related to manufacturing operations, business enterprises;
b) expenses have enough bills, vouchers in accordance with the law.
2. expenses not deducted in determining taxable income include: a) the payments do not meet the conditions specified in paragraph 1 of this article, excluding the value of losses due to natural disasters, epidemics and other unforeseen circumstances not be compensated;
b) fines due to administrative violations;
c) expenses are offset by other funding sources;
d) portion of the business management costs caused by foreign enterprises to allocate to their resident establishments in Vietnam exceeded calculated according to the method of allocation by the Vietnam law regulations;
DD) part exceeded according to the provisions of the law of extract formed reserve;
e the cost of raw materials, Parts) material, fuel, energy, commodity beyond the norm of attrition due to the construction business, notify the tax authority and the actual output prices;
g) part payment of interests on the loan production, the business object is not credit institutions or economic organizations exceeded 150% of the basic interest rate by the State Bank of Vietnam announced at the time of the loan;
h) depreciation of fixed assets is not properly regulated by law;
I) before deductions on the cost of not correct provisions of the law;
k) salaries, remuneration of owners of private enterprises; remuneration paid to founding members not directly involved in the business is executive producer, business; salary, wages, other accounting items to pay for workers but does not pay or no bills, vouchers in accordance with the law;
l) pay interest on borrowed money which corresponds to the capital part is missing;
m) input value added Tax has been deducted, the value added tax, filed under deduction method, the enterprise income tax;
n) part of advertising, marketing, promotion, Commission; genus receptions, conferences; genus marketing support, support costs, payment discount; genus report, courtesy of the associated press agency directly to production, business activities exceeds 10% of the total expenditure was subtracted; for established businesses is the part in excess of 15% in the first three years, since being established. The total number of genera are not included unless otherwise specified expenditures at this point; with respect to commercial activity, total spending was except not including the purchase price of the goods sold;
o) grants, except grants for education, health, disaster recovery and the gratitude for the poor under the provisions of the law.
3. Expenses in foreign currency are deducted in determining taxable income must redeem the Vietnam average transaction rate on the inter-bank foreign currency market by the State Bank of Vietnam announced at the time of incurring the cost in foreign currency.
The Government detailing and guiding the implementation of this Article.
Article 10. Tax rate 1. The enterprise income tax rate is 25%, except in the case specified in clause 2 of this and article 13 of this law.
2. the enterprise income tax rates for the search operation, exploration and exploitation of oil and gas and other precious resources from 32% to 50% match with each project, each business establishment.
The Government detailing and guiding the implementation of this Article.
Article 11. The method of tax calculation

1. enterprise income tax amount payable in tax period is calculated by multiplying taxable income with tax; the business case has filed income tax returns in addition to Vietnam, the income tax already paid but must not exceed business income tax amount payable under the provisions of this law.
2. The method of tax calculation for business specified in points c and d item 2 article 2 of this law are made according to the regulations of the Government.
Article 12. Where tax business tax in place of headquarters. The business case has production facilities accounting depend to operate in the province, the central city in different geographical areas where the enterprise has its headquarters, the calculated tax amount filed according to the ratio between costs where production facilities and headquarters. The hierarchy, management, use of revenues are made according to the provisions of the law on the State budget.
The Government detailing and guiding the implementation of this Article.
Chapter III the ENTERPRISE INCOME TAX INCENTIVES article 13. Preferential tax rate 1. -Established business from investment projects in geographical socio-economic conditions particularly hard, economic zones, high-tech zones; -established business from the investment projects in the fields of high technology, scientific research and technological development, developing infrastructure, in particular the importance of the State, producing software products are applied tariff of 10% in fifteen years time.
2. enterprises operating in the fields of education, vocational training, health, culture, sports and environment are applied tariff of 10%.
3. establishment of new business from the investment projects in geographical socio-economic conditions are difficult to apply the tax rate of 20% in ten years time.
4. agricultural service cooperatives and people's credit fund be applied tax rate of 20%.
5. for special needs project attracting large scale investment and high technology, the time to apply the tax incentives may be stretched, but extended the period of time not exceeding the time limit specified in paragraph 1 of this article.
6. The time the tax incentives provided for in this Article shall be calculated from the first year of business for sales.
The Government detailing and guiding the implementation of this Article.
Article 14. Incentives of the tax exemption period 1. -Established business from investment projects in geographical socio-economic conditions particularly hard, economic zones, high-tech zones; -established business from the investment projects in the fields of high technology, scientific research and technological development, developing infrastructure, in particular the importance of the State, producing software products; the new established businesses operating in the fields of education, vocational training, health, culture, sports, and the environment are tax must not exceed four years and 50% reduction of the payable tax must not exceed nine next year.
2. establishment of new business from the investment projects in geographical socio-economic difficulties are tax must not exceed two years and 50% reduction of the payable tax must not exceed four years.
3. Time of tax exemption and reduction prescribed in this article shall be calculated from the first year of business taxable income; the business case does not have taxable income in the first three years, since the first year the sales tax, the tax reduction is calculated from the fourth year.
The Government detailing and guiding the implementation of this Article.
Article 15. The other tax reduction case 1. The manufacturing business, building, transport use many women workers are enterprise income tax by the number of additional labor for females.
2. The business use is the employer of minorities be reduced corporate income tax by a few more more for labor is the minority.
The Government detailing and guiding the implementation of this Article.
Article 16. Move the hole 1. The enterprise has transferred to the holes of the holes the following year; This loss be deducted from taxable income. Time was moving the hole no more than five years, since the next year year incurred losses.
2. Business losses from property transfer operations is only the transfer of the hole in tax revenue of this operation.
Article 17. Extract Development Foundation for science and technology of business 1. The business was established, operating in accordance with the law of Vietnam was to extract a maximum of 10% of the annual taxable income to Fund science and technology development of the business.
2. Within a period of five years, since the quote, if the Fund for science and technology development are not used or not used off 70% or improper use of the purpose, the business must submit the State budget tax business income calculated on earnings was quoted up funds that do not use or improper use of the purpose and the interest rate arising from tax number that business income.
Corporate income tax tax rate used to calculate the recovery tax is the tax rate applicable to business deductions during the establishment of the Fund.
Interest interest rate for the recovery of tax on the portion of funds not used up is kind of Treasury bond interest rate tenor of one year applies at the time of withdrawal and interest period is two years.
Interest interest rate for the recovery of tax on the portion of the Fund misuse the purpose of penalty interest rates are slowly filed under provisions of the law on tax administration and interest period is the period of time since the extract to funds when withdrawn.
3. The enterprise is not accounting expenses from the Fund for science and technology development of enterprises on costs are deducted in determining taxable income in the tax period.
4. The Fund for science and technology development of the enterprise was used only for investment in science and technology in Vietnam.
Article 18. Conditions apply tax incentives 1. Enterprise income tax incentives provided for in articles 13, 14, 15, 16 and 17 of this Act apply only for business accounting regimes, bills, vouchers and pay tax according to the Declaration.
2. Businesses must own accounting of income from production and business operation are tax incentives specified in article 13 and article 14 of this law with the income from production and business operations are not tax incentives; where does the private accounting, the income from production and business operation are tax incentives is determined according to the proportion between the manufacturing activities, business are tax incentives on the total revenue of the business.
3. The enterprise income tax incentive provisions of article 13 and article 14 of this Act do not apply to: a) the income specified in clause 2 of article 3 of this law;
b) revenue from the search operation, exploration and exploitation of oil and gas and other precious resources;
c) income from the business of gambling, betting in accordance with the law;
d) other circumstances as stipulated by the Government.
Chapter IV the TERMS OF IMPLEMENTATION of article 19. Effect 1. This Act has effect from January 1, 2009.
2. This Act replaces corporate income tax law No. 9/2003/QH11.
3. Enterprises are entitled to the preferential enterprise income tax according to the provisions of the corporate income tax law No. 9/2003/QH11 continue to enjoy the incentives for the time remaining under the provisions of the corporate income tax law No. 9/2003/QH11; the case of preferential corporate income tax including tax incentives and tax exemption period is lower than the level of incentives under the provisions of this law shall be applied to tax incentives under the provisions of this law for the remainder.
4. in an affected business tax, tax relief under the provisions of the corporate income tax law No. 9/2003/QH11 which not have taxable income, then the time begins to count the time tax free, tax relief is calculated according to the provisions of this law and since the day this law is in effect.
Article 20. Government enforcement guide detailing and guiding the implementation of articles 4, 7, 8, 9, 10, 11, 12, 13, 14, 15, 18 and the other necessary contents of this Act at the request of management.
This law was the National Assembly of the Socialist Republic of Vietnam XII, third session through June 3, 2008./.

Related Laws