2021 Overview of General Tax Obligations and Deadlines in Vietnam

Despite unprecedented global events, Vietnam stood strong in 2020, managing to achieve 4.48% growth in GDP — reinforcing its stature as a beacon for business in Southeast Asia. As that sort of progress continues to attract investment, it’s a good time to give an update on your obligations and deadlines to all things related to tax in Vietnam in 2021.

Like any other respected economy, tax compliance is crucial in Vietnam, as there are serious legal consequences for those who do not observe the law. Non-compliance can result in weighty penalties or the revocation of your business license — so it’s advisable to catch up on your responsibilities every year.

First, we’ll go over the major tax deadlines in Vietnam for 2021, followed by an overview of your obligations for those taxes.

Vietnam Tax Deadlines for 2021

Vietnam allows you to choose from four fiscal year periods:

• January 1 to December 31
• April 1 to March 31
• July 1 to June 30
• October 1 to September 30

However, there are two dates that are the most important in terms of tax compliance in Vietnam — January 30, 2021, and March 30, 2021.

First Vietnamese Major Tax Deadline — January 30, 2021

January 30, 2021, is the deadline for the following tax payments and/or declarations for 2020 in Vietnam.

• Personal income tax (PIT) of Q4, 2020 – declaration and payment
• Corporate income tax (CIT) of Q4, 2020 – declaration and paid on estimates
• Value-added tax (VAT) of Q4, 2020 – declaration and payment
• Annual business license tax for Vietnamese companies

Second Vietnamese Major Tax Deadline — March 30, 2021

March 30, 2021, is the deadline for the following tax payments and/or declarations for 2020 in Vietnam.

• Financial statement or report of 2020: profit and loss, cash flow, balance sheet, and financial statement note
• Tax settlement declarations of 2020: PIT settlement declaration and CIT settlement declaration
• Statistic or compliance report of 2020
• Foreign Direct Investment (FDI) reports

Financial statements are only required if your company was registered before October 2020. Otherwise, you can compile the submission with your financial statement of 2021.

Other Corporate Compliance Deadlines in Vietnam for 2021

Quarterly

• Corporate Income Tax (CIT) payment
• Value Added Tax (VAT) declaration and payment
• Personal Income Tax (PIT) declaration and payment
• Report on foreign labour use

Bi-annually

• Report of labour use

Annually

• CIT and PIT settlement reports
• FDI report
• Audited financial report
• Business license tax payment

Vietnam Tax Obligations for 2021

While not an exhaustive list, here is an overview of your major tax obligations in Vietnam for 2021.

Vietnam Corporate Income Tax Obligations

• Tax rate: 20% on assessable income; 32-50% for the oil and gas and other mineral extraction sectors
• Tax year: January 1 to December 31 2021

Annual Business License Tax Payment

• Tax rate: Depends on the business’s registered capital:
• Capital is 10 billion VND or less (~US$ 430,000)
• 2 million VND (~US$ 85)
• Capital is more than 10 billion VND
• 3 million VND (~US$ 130)
• Branches, representative offices, business location, public service providers, and other business organizations
• 1 million VND (~US$ 40)
• Tax deadline: January 30

Vietnam Personal Income Tax Obligations

• Tax rate: 5 – 35% depending on the individual’s income
• Tax resident: individual resides in Vietnam for at least 183 days in 12 consecutive months; individual who holds a permanent or temporary residency in Vietnam; an individual who rents a property in Vietnam for 183 consecutive days
• Tax year: a calendar year which is the same as the individual’s tax year

Based on Resolution 954/2020/UBTVQH14 on June 2, 2020, there were increases in family circumstance-based deductions for Personal Income Tax:

• Increase Individual Deduction from VND 9 million (US$390) per month to VND 11 million (US$476) per month
• Increase Family Deduction from VND 3.6 million (US$156) per month to VND 4.4 million (US$191) per month
• These deduction increases will reduce the accessible income for PIT

Vietnam Foreign Contractor Withholding Tax Obligations

• Deemed CIT rate: 0.1 – 10% depending on the business
• Deemed VAT rate: 0 – 5% depending on the business
• Applicable to: Foreign organisations with income derived from business in Vietnam

Vietnam Value Added Tax Obligations

• Tax rate: 0 – 10% depending on the type of services and goods
• Applicable to: purchases of goods and services (including goods and services purchased from non-residents), with certain exemptions

Vietnam Special Sales Tax Obligations

• Tax rate: 7 – 150% depending on the type of product or service
• Applicable to: the importers, producers, and providers of goods and services

Should You Complete Your Vietnam Taxes Yourself, or Should You Outsource?

While you could file your own taxes in Vietnam, in general, it’s advisable to get the help of qualified tax professionals.

This ensures that you are able to optimise your obligations to take advantage of the many tax incentives, tax reliefs, tax rebates, and tax treaties Vietnam offers.

Without that professional guidance, you are likely to miss out on retaining profits, or worse, risk an incorrect filing, which could result in harsh penalties.

By hiring a trusted Vietnamese tax advisor, you will save time, money, and even get advice on how to save money in the future.

Where to Next for Your Vietnam Tax Responsibilities in 2021?

As Vietnam continues its journey to being a mature economic power in 2021, tax policies and business incentives are becoming more and more investor-friendly.

To keep ahead of the curve, we recommend you explore your options in regards to optimising your tax obligations with the goal of saving both time and money, not to mention potential headaches.

When shopping around for tax advice in Vietnam for 2021, we encourage you to be discerning — you should be receiving nothing less than a hassle-free corporate tax filing process that optimises your tax obligations for maximum profit.

If you’d like help in your corporate tax filing in 2021, InCorp has a team of export accountants, bankers, and lawyers to help you ensure your company takes absolute advantage of Vietnam’s tax system.

If you have any questions about how you can optimise your Vietnamese corporate tax filings in 2021, please contact us.