ECO

N Tax

OVIS STT Vietn

Nex, Audit, Acco

nam - Newslet

ewounting and

tter - June 201

wslLegal Updat

2

lette

tte

er

Amended

Additionand Indiv

New CircTax

ImplemeEnterpriand Imp

Draft OrExchang

d Labour Co

nal Tax Relieviduals Appr

cular on For

entation of Eises’ (EPEs) rort

rdinance on Fge Control

Newslette

ode

efs for Enterproved

reign Contrac

xport Procesrights on Exp

Foreign

r, June 2012

prises

ctor

ssing port

2

ECO

OVIS STT Vietn

LABOU

Amended

On 18 JunVietnam awhich wilamended changes tofirstly intrLabour CoNational Aand 2007.

We highlithe amend

• Materincreafrom tleave to thecappeof 04 date. Tapplicmater

• Standhour pof ovework monthGoverbusineoverti

• Publiccoverdays, Day oof 1 dand N

nam - Newslet

UR UPDATE

d Labour Co

ne 2012, the Napproved the ll be effectiveLabour Codeo the originalroduced sinceode was amenAssembly of V.

ight the followded Labour C

rnity leave forase to 06 monthe social inscould be take

e birth date, bued at 02 monthmonths will bThis leave encable to femarnity leave du

dard work houper day and 4ertime work, hours must n

h and 200 hournment will pesses that canime work hou

c holidays wiring VietnameNew Year’s D

of 1 day, Hunday, InternatioNational Day o

tter - June 201

E

ode

National Asseamended Lab

e from 1 May e provides funl Labour Codee 1994. The onded several Vietnam in 2

wing notable Code:

r female empnths with full urance fund. en by the emput such prior hs and the babe taken after

ntitlement is ale employees

uring 1 May 2

urs are still ca48 hours per wthe maximum

not exceed 30 ur per year. Tprovide the lisn organize maurs of 300 hou

ill increase to ese/Lunar NewDay of 1 dayg Kings Com

onal Labour Dof 1 day.

2

embly of bour Code 2013. The

ndamental e which was riginal times by the 002, 2006,

changes of

ployees will payment Maternity

ployees prior leave is lance leave r the birth also who are on 013.

apped at 08 week. In case m overtime

hours per The st of specific aximum urs.

10 days, w Year of 05 , Liberation

mmemoration Day of 1 day,

• Wtea

• Te“p

• TwpwofVpaefu

It is amendetaiPleaclari

Wages for emthe amended employees wiallowances, a

The amendedenterprises to“labour outsoprovided they

The maximumwork permit ipermit exempworking in Vonly applicabfor provision Vietnam to deproblems whiaffected the benterprises thforeign speciaunable to han

expected thatnd about 20 dil guidance ofse contact ouification or in

mployees are cLabour Codeill include fix

and other paym

d Labour Codo provide "labourcing” to othy are licensed

m term of foreis reduced to ption for forei

Vietnam for lesble to those co

of services oeal with compich may affec

business activhat Vietnamesalists currentl

ndle.

t the Governmdecrees or mof the amended

ur advisor if yonformation.

clearly definee. Wages for xed salaries, ments.

e accepts bour supply" oher enterprise

d to do so.

eign employe02 years. Woign employeess than 03 moome to Vietnar those come plicated technct or already vities of the se specialists ly in Vietnam

ment will issuore to provided Labour Codou need any

ed in

or es

ees’ ork es onths am to

nical

and m are

ue or the

de.

ECO

OVIS STT Vietn

TAX UP

AdditionIndividua

In additiopayments and June 2Income Tpassed a Rthe additioenterprise

We highli

Personal I

Individuaemploymeto PIT at tincome doexemptedDecember

We note ttaxable incomprisesdifferent rcircumstaVND1.6 macceptable

Corporate

A 30% refurther allEnterpriseenterpriseapplicablebusinessefinance, bgoods andConsumpt

New Circ(“FCT”)On 12 ApVietnam iproviding(common

nam - Newslet

PDATE

al Tax Relials Approve

n to the recenof Value Ad

2012 and payax, the Nation

Resolution ononal fiscal sti

es and individ

ight the key ta

Income Tax (

l taxpayers haent income orthe first threshoes not excee

d from PIT fror 2012.

that the assessncome less alls taxpayers’ crates, deducti

ances (VND4 million/depene deductions,

e Income Tax

duction of thelowed for Smes (SMEs) anes. This reduce to SMEs whs of lottery, re

banking, insurd services subtion Tax.

cular on Fo) pril 2012, the issued Circula

g guidance on ly called as “F

tter - June 201

iefs for Enteed

nt welcomed pded Tax for A

yments of Cornal Assembly

n 21 June 201imulus measuduals in Vietn

ax reliefs as f

(“PIT”)

aving the asser business inchold of 5% (td VND5 mill

om 1 July 201

sable income lowable deduccompulsory inons for familymillion/mont

ndant/month), if any.

x (“CIT”)

e CIT payablemall and Mediu

d labour intenction of CIT phich are engageal estates, serance, manufabject to the Sp

reign Contr

Ministry of Far 60/2012/Ttax obligatioForeign Cont

2

erprises and

postpone of April, May rporate y of Vietnam 2 approving

ures for both am.

follows:

essable come subject the assessablelion) is 12 to 31

is the ctions which nsurances at y th and , and others

e in 2012 is um nsive

payable is not ged in the ecurities, acturing pecial

ractor Tax

Finance of TT-BTC

ns tractor Tax”

d

e

or “Findivtheir

Notainclu

• CaocaotVwVh

• CtioVhpeooVT(Tam

FCT”) for forviduals doingr income deriv

able highlightude:

Circular 60/2applicable enor “foreign sucalled as the “applicable enorganizationsthey have perVietnam) or iwhether or noVietnam) doihaving their i

Circular 60/2the followingindividuals asorganizationsVietnam in thhave their incpoint excludeexport of the organizationsorganizationsVietnam withTerms (INCO(Delivered DuTerminal), anand (iii) and fmarketers, an

reign organizag business in Vved from Vie

ts of Circular

2012/TT-BTCtities as “foreub-contractors“foreign conttities include

s (irrespectivermanent estabindividuals (irot they are taxng business inincome derive

2012/TT-BTCg foreign orgas applicable es or individuahe form of oncome derived es the processprocessed go

s or individuas or individuah the InternatiOTERM) delivuty Paid), DA

nd DAP (Deliforeign Intern

nd online train

ations or Vietnam or hatnam.

r 60/2012/TT-

C defines the eign contractos” (commonlytractors”. Theforeign

e of whether oblishments in rrespective ofx residents in n Vietnam ored in Vietnam

C further incluanizations or entities: (i) forals supply goo-site export ain Vietnam (ing of goods

oods to the forals); (ii) foreigals supply gooional Commevery of DDP

AT (Deliveredvered at Place

net advertisersners.

aving

-BTC

ors” y

or not

f

r m.

udes

reign ods in nd this and

reign gn ods to rce

d at e); s or

ECO

OVIS STT Vietn

• Circuan obhandlunlessfollow(“VASenableaccou

• FCT iforeigValueCorpoorganTax (“(“PITOthercontra

• Circuthat arfollow

o Purorgaorga

o Forhavthe con

o Speorgaserv(airpartequtranwhepartmarInteandgootrainservpos

nam - Newslet

ular 60/2012/Tligation to orge the filing ans the foreign cw the VietnamS”) Method oes them to pa

unts. is defined as tgn contractorse Added Tax (orate Income nizations, and “VAT”) and P

T”) for professr taxes may beactors.

ular 60/2012/Tre not subject

wing cases:

re purchases oanizations or anizations an

reign organizaving incomes d

services whicnsumed outsidecific servicesanizations anvices for meancrafts, aircrafts, or vessels/

uipment (inclunsmission devether or not mts are providerketing (excepernet); (iii) prd commerce; bods and servicning services vices); (v) shatage or teleco

tter - June 201

TT-BTC contiganizations innd payments contractors re

mese Accountior Hybrid Metay the FCT on

those taxes aps include the (“VAT”) andTax (“CIT”) the deemed VPersonal Incosional foreigne applicable t

TT-BTC re-cot to FCT. The

or supplies byindividuals tod individuals ations and indderived in Vich are providede Vietnam. s provided byd individualsns of transporfts’ engines an/ships) and mauding the oceavices), irrespematerials or reed; (ii) advertipt those proviomotion of inbrokerage forces outside Vi

(except onlinaring of internommunication

2

inues to placen Vietnam to of FCT, egister and ing System thod which

n their own

pplicable to deemed

d the deemed for foreign

Value Added ome Tax n individuals. to foreign

onfirms cases ey include the

y foreign o the in Vietnam.

dividuals ietnam from ed and

foreign : (i) repairingrtation nd spare achinery and an cables and

ective of eplaced spare isement and ided via the nvestment r the sales of ietnam; (iv) ne training national n charges for

e

e

g

d

• CFatcobwothpbapCininmo

Ho

o

o

services prolease of thesatellite bro

Circular 60/20FCT to be calct different VAontract/agreemusiness activi

with different n the taxable he contract/agrovides the luusiness activipply. The tax

Circular 60/20ncome receivencluding the r

made by the Vn behalf of th

However, the to The taxable

the deemedgrossed up)VAT (if anyimported go

o The taxablethe deemedgrossed up)deemed VA

o Where the fpart of the clegal entity contractor pMethod or H(this subconwith the concontractor),calculationsdeemed CITthe contractby such a lecontractor.

ovided outside foreign transoadband.

012/TT-BTC sculated at the AT and CIT rment provideities and resprates can be cturnover of e

greement. If thump sum pricities, the high

xable turnover012/TT-BTC aed by the forereimbursemen

Vietnamese cohe foreign con

taxable turnoe turnover ford VAT is the t) turnover why) paid by theoods; e turnover ford CIT is the to) turnover whAT; and foreign contracontractual win Vietnam o

paying taxes uHybrid Methontracting musntract signed , the taxable ts of the deemT shall excludtual works/seegal entity or

de Vietnam, orsmission cabl

still allows thtaxable turnoates. If the

es with differeective prices,calculated baseach activity ahe contract on

ce for differenhest FCT rate r is defined inas total amoueign contractonts or paymenontacting partntractor.

ver excludes:r the calculatitotal gross (or

hich excludes e importers fo

r the calculatiotal gross (or hich excludes

actor subcontworks/servicesor a foreign under the VASod in Vietnamst be complianby the foreig

turnover for thmed VAT and

des the value ervices perform

foreign

r les or

he over

ent FCT sed as per nly

nt will

n unt of or, nts ies

: on of r the

or the

on of

the

tracts s to a

S m nt

gn he

of med

ECO

OVIS STT Vietn

Circular 6

Servicesequipme

Drilling projects

Trading goods, mequipme

Constructhe suppmachineConstrucwithout tand/or mTransporbusiness

Managemrestauran

Transferto foreigcommissforeign i

Lease ofparts of a

Derivativ

Interest i

Royaltie

nam - Newslet

60/2012/TT-B

Business Ac

, lease of macent, oil rigs, an

services for p

(Distributionmaterials, macent in Vietnam

ction and instlies of materiry and equipmction and instthe supplies o

machinery andrtation, produ activities

ment servicesnts, and casin

r of securities,gn insurers, ansions for re-ininsurers

f aircrafts, engaircrafts, and

ves

income

es

tter - June 201

BTC provides

tivity

chinery and nd insurance

petroleum

n, supplies of chinery, and m)

tallation with ials, and/or ment tallation of materials, d equipment uction, or othe

s for hotels, nos

, re-insurancend nsurance to

gines and spavessels

2

the following

Ratio (%T

50% (to respectiv

70% (to respectiv

VAT, if importer

30% (to respectiv

50% (to respectiv

er 30% (to respectiv

It seems apply (torespectiv

e

VAT exe

are It seems apply (torespectiv

VAT exe

It seems loans froinstitutiofrom noninstitutioThe Minconfirm

VAT exe

g deemed VA

%) of Value ATaxable Turn

be applied byve VAT rate)

be applied byve VAT rate)

any, is paid brs in Vietnam

be applied byve VAT rate)

be applied byve VAT rate)

be applied byve VAT rate)

that the rate oo be applied bve VAT rate)

empt

that the rate oo be applied bve VAT rate)

empt

that VAT is eom foreign creons only, and n- credit/bankons are subjecnistry of Finanthis VAT trea

empt

AT and CIT ra

Added on the nover

y the

y the

by the

y the

y the

y the

of 50% will by the

of 50% will by the

exempt for edit/banking that loans

king ct to VAT. nce will atment soon.

ates:

Ratio (%Taxab

It seems 5% w

%) of CIT onble Turnover

5%

that the rate owill apply

1%

2%

2%

2%

10%

0.1%

2%

2%

5%

10%

n

of

ECO

OVIS STT Vietn

• CirculaforeignMethodway wdeeme(i) has Vietnaresidenpresenvirtue appliesguidan

• Circu27 Ma134/2BTC, Miniscontraon theapplyFCT asignedapplysome

We suggeagreemenas to take circular. Ythe last paadvice.

nam - Newslet

ar 60/2012/Tn contractor tod to pay the n

with the compad CIT providthe permanen

am (or the forent in Vietnamce in Vietnamof the contracs the accountince of the Min

ular 60/2012/Tay 2012 and r

2008/TT-BTC,and Circular

stry of Financacts or agreeme effective da

y the provisionand those cond and execute

y the previous specific exce

est clients revnts to ensure th

the best advaYou may contage of this new

tter - June 201

TT-BTC still alo follow the Hnormal VAT ianies in Vietn

ded the foreignnt establishmeign contracto

m); (ii) has them for 183 dayct execution; ing books as pnistry of Finan

TT-BTC is effreplaces Circu, Circular 19r 64/2010/TTce on FCT. O

ments signed te of 27 May ns of the new ntracts or agreed prior 27 Mregulations o

eptions.

iew the contrhe tax compliantages of thetact our profewsletter for su

2

llows a Hybrid in the same nam and the n contractor: ent in or is a business

ys or more by and (iii) per the nce.

fective from ular 7/2009/TT-T-BTC of theOnly and executed2012 will circular on

eements May 2012 will

on FCT with

racts or iance as well e new essionals at upport and

d

ImpEnteImp

On 2736/Depaon imand i

The impoimplcomppolicgoodfor nExpo45, CDeceThosfor thpurc

In caand iinstecustoaccotransEPE194/In cagoodin VimplapplcondstipuCP dare s

plementationerprises’ (EP

port

20 February 2/TCHQ-GSQLartment of Cumplementatioimport.

Letter confirmorting goods tlement its righplete customscies on exportds in accordannon-EPEs (puort and ImporCircular 194/ember 2010 ose procedureshe exported g

chase goods fr

ase the EPEs import to sell

ead of exportioms procedur

ordance with rsaction of goo

Es as regulated/2010/TT-BCTase EPEs impds to foreign c

Vietnam, the culemented in aicable to the o

ditions for on-ulated in Articdated 15 Decesatisfied.

n of Export PPEs) rights

2012, OfficialL was issued bustoms to proon of the EPE

ms that EPEsto/from foreight on export as procedures at and import fnce with com

ursuant to Artirt Duties and /2010/TT-BTCof the Ministrys and tax policgoods when surom non EPE

implement thl the goods toing to foreignres are implemregulations apods between nd in point d, cT.

plement the rigcountries but ustoms proce

accordance wion-site export-site export ancle 15, Decreember 2005 o

Processing on Export a

l Letter by the Generavide instructis’ rights on ex

exporting or gn countries tand import haand follow thfor commerci

mmercial contricle 3, Law onclause 7, Art

C dated 06 y of Finance)cies are exemuch EPEs

Es.

he rights on ex other EPEs

n countries, thmented in pplied for non-EPEs andclause 3, Circ

ght of export make the del

edures are ith regulationt as long as thnd import as e 154/2005/N

of the Govern

and

al ion xport

r to ave to he tax ial racts n ticle

). mpted

xport

he

d the ular

of livery

s he

ND-nment

ECO

OVIS STT Vietn

FOREIG

Draft OrControl

On 12 Maa Draft Orin the Ordpublic opi

Major chainclude:

• The Dthe usNot olistingcurren

This  is one oenvironmentshould it be r

nam - Newslet

GN EXCHA

rdinance on

ay, the State Brdinance amedinance on Foinion.

anges propose

Draft proposedse of foreign conly are transags and advertincy prohibited

of  the newslettet in Vietnam. Threlied upon as a 

tter - June 201

ANGE UPDA

Foreign Ex

Bank of Vietnending a numboreign Exchan

ed in the Draf

d increased recurrencies in actions, paymisements in fod, but also qu

ers  from ECOVISe information asubstitute for a

2

ATE

xchange

nam released ber of articlesnge to collect

ft Ordinance

estrictions on Vietnam.

ments, price oreign uotations, use

S STT Vietnam  tnd analysis or c professional ad

s

oaibo

• Oofonl

The year

to update  the  laomments hereindvice for particul

of foreign curand referencein contracts wbe a significaon using fore

Only enterprion Enterpriseforeign bank overseas. Coono longer perlenders.

Draft is expe.

atest developmen are of the genelar situation. 

rrencies in dee to prices in fwill be prohibant tightening ign currencie

ises establishees, credit instibranches canoperatives andrmitted to bor

ected to be fin

ents/reforms  in eric nature and 

etermining priforeign currenited. This woof the restrics in Vietnam

ed under the Ltutions and

n borrow fromd individuals rrow from fore

nalized later th

legal,  tax and are not intende

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ECOVIS STT Vietnam - Newsletter - June 2012

ECOVIS STT Vietnam

Audit and Assurance International and Local Taxation Accounting and Business Process Outsourcing Business

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