Vietnam to tighten tax management of online businessesThe Saigon Times Daily A man holds his smartphone which displays the Google home page. A draft law on tax management has added many regulations on ecommerce businesses that transact on Google and social media platforms – PHOTO: REUTERS HCMC - A draft law on tax management has added many regulations on ecommerce businesses that transact on Google and social media platforms, including building a database and launching e-taxation services such as e-tax declarations and e-invoices, heard attendees at a meeting held on August 7. The move is aimed at strictly monitoring online businesses, reported the local media. The General Department of Taxation, the Vietnam Chamber of Commerce and Industry and the Vietnam Tax Consultants’ Association (VTCA) jointly organized the meeting to collect feedback on the draft Law on Tax Management. The amendment to the law is set to deal with tax evasion by online account holders, as in … [Read more...] about Vietnam to tighten tax management of online businesses
Vietnam tax authority website
The liquidation of a Vietnamese legal entity is a lengthy and complicated process in which the final tax audit involves a lot of effort from the dissolving entity. This article is to provide a list of key and common issues, which are frequently challenged by the tax authorities during a tax audit upon dissolution for the enterprises’ perception and compliance in order to mitigate the risks of additional tax liabilities, penalties, and interest on late tax payment. There is a lot to consider when liquidating a company, with tax issues a major issue General procedures of liquidating a company The voluntary dissolution procedures of a company include the following steps with relevant parties and regulatory authorities: Resolution on dissolution to be passed by investors, disclosed to relevant stakeholders and announced publicly in the newspaper; Terminating contracts (with customers, suppliers, landlord, etc.) and liquidating assets; Settling liabilities in accordance … [Read more...] about Liquidation of a Vietnamese entity—critical tax exposures
At the first instance hearing, the representative of Standard Chartered Vietnam asked Quang Minh Corporation JSC (QMC) to pay its debts of VND89.9 billion ($4 million), and Standard Chartered Mauritius also asked for the repayment of over VND38 billion ($1.7 million). Quang Minh Corporation is not the only large debtor of Standard Chartered Vietnam that has defaulted on payments In 2013 Standard Chartered Vietnam and Standard Chartered Mauritius granted letters of short-term credit for Quang Minh Corporation JSC (at No.1 Thanh Nien street, Ba Dinh district, Hanoi) limited at $20 million. Then they signed contracts of mortgaging goods, receivables, insurance contracts, as well as all of QMC’s accounts and deposits in banks to secure the loans. Standard Chartered Vietnam lent VND60.9 billion ($2.7 million) at the annual rate of 7.6 per cent first (later adjusted to 8.3 per cent), and an additional VND5.1 billion ($225,000). These debts expired in April 2015, but QMC has … [Read more...] about Standard Chartered Vietnam asks Quang Minh Corporation to pay $4 million debt
Handing over the right of prosecution and investigation to tax authorities may halt tax evasion? Authorities powerless in face of tax evasion by foreign firms In reality, despite the fact that foreign firms are acquiring massive annual revenue and profit from their operations in Vietnam, the local government faces difficulties in collecting tax from them, as could be seen with the examples of Uber and booking sites Agoda, Booking.com, and Traveloka. A number of these enterprises have been delaying tax payments, while others took advantage of loopholes to evade tax obligations. Notably, in late January 2017, the Ministry of Finance (MoF) asked booking sites that allow tourists to book hotel rooms in Vietnam to calculate and pay VAT and CIT. Targeted websites include Agoda, Traveloka, Booking, and Expedia. The CIT rate is 5 per cent of the total revenue. VAT is calculated on the added value that the companies, called “the foreign contractor” by the ministry, make. MoF … [Read more...] about Extending mandate of tax authorities may halt tax evasion?
A helpful starting point to identify where tax obligations fall after a transfer With the increasing number of mergers and acquisitions (M&A), transfer of contributed capital and securities is becoming more common and is widely used by both domestic and foreign investors. Complying with the regulations and having a tax efficient approach is one of the key concerns of most shareholders who would like to invest or divest from a Vietnamese company. In general, share transfer in Vietnam includes the sale of capital contributed in a limited liability company (LLC) and securities of a joint stock company (JSC), and in certain circumstances, the taxes imposed on each transaction are different. Tax liability of the sellers Corporate sellers/transferors For local corporate sellers, any gain derived from the transfer of capital/securities in another Vietnamese entity is regarded as ‘other income’ and is accordingly subject to corporate income tax (CIT) at the current … [Read more...] about Tax implications of selling equity or shares in Vietnamese entities