After registering a company in Vietnam, foreign investors must ensure that it complies with local laws and reporting requirements. This article was written to give details about business compliance in Vietnam and to assist foreigners in planning their tax reporting in Vietnam ahead of time.
Table of Contents
Registering for tax
To follow business compliance in Vietnam, foreign owners have to complete tax registration at a local tax department after acquiring their Business Registration Certificate. Each business will be assigned a company registration code that also serves as a tax identification number.
Issuing VAT invoices
Another requirement for business compliance in Vietnam is VAT invoices. Electronic, pre-printed, self-printed, and ordered invoices are all options for businesses in Vietnam. The District Taxation Department sells pre-printed invoices to businesses that use the direct deduction technique.
Obtaining a business license tax certificate
- Statement of income
- Statement of financial position (profit and loss)
- Statement of changes in equity (if any)
- Balance sheets
Within 30 days of formation, you must additionally register all employees on your payroll in Vietnam. A labor use report is also requested twice a year by the District Department of Labor.
The report should include information such as the number of employees, their jobs, credentials, and the type of labor contract, such as fixed-term or indefinite-term labor contracts, among other things.
Social insurance registration
You must enroll all local workers in obligatory insurance (includes social, health, and unemployment insurance) in order to follow business compliance in Vietnam. These insurances are covered by both the company and the employees.
Although reports and taxes have a set time, all other changes in a business must be reported immediately to follow business compliance in Vietnam. For example, the company changes its address, the board of directors changes, or a shareholder or board member obtains a new passport.
Following an audit, if the tax authorities discover discrepancies in the financial records, a 20% tax will be applied to the under-declared amount. Late tax payments are also subject to a 0.03 percent daily interest charge.
Keeping up with business compliance in Vietnam requires precision and takes a lot of effort. You can always contact Bizspective for more detailed advice about business compliance in Vietnam. We also suggest you get in touch with a good lawyer and a good tax expert to ensure that your company follows all local requirements.