Our November 2017 Tax Update publication focuses on upcoming changes for payroll expenses and calculations for Vietnamese employers, along with a selection of Official Letters released by the tax authorities.
Substantial changes come into effect from 1 January 2018 affecting the calculation of payrolls in Vietnam. The results of the changes are that, essentially, remuneration payments received by employees will be subject to compulsory Insurances and Personal Income Tax (“PIT”) unless specifically excluded.
We have released our guide to Corporate Structures in Vietnam for Foreign Investors.
This publication provides easy to read guidance covering the available structures when investing in Vietnam, the key roles and positions of individuals, and documents required for investment.
This month we look at a proposal for structural changes to Vietnam’s taxation system in this September 2017 publication of our Tax Updates from Domicile Corporate Services. We also look at other releases from the authorities that we believe are of interest to taxpayers in Vietnam.
This August 2017 Tax Updates publication from Domicile Corporate Services looks at selected changes that have an impact on businesses operating in Vietnam. If you have any questions arising from this publication, then please contact us.
At the present time, foreign individuals working in Vietnam are only subject to compulsory government Health Insurance and Personal Income Tax on their salary. However, changes from 1 January 2018 will result in Social Insurance becoming compulsory for most foreign employees in Vietnam. With a total impact to salaries of up to 25.5% (17.5% employer portion and 8% employee portion), this may result in a substantial impact on payroll costs and take-home salaries.
Changes released during 2017 to the Transfer Pricing regulations in Vietnam, together with the additional procedural changes from the Vietnam tax authorities, have made the process of transacting with related companies abroad from Vietnam more complicated and uncertain, particularly for smaller foreign invested businesses.
Work Permits appear to cause much confusion and stress in Vietnam, yet this is unnecessary and they are far less complicated or stressful than many make out.
Fundamentally, all foreign individuals require a Vietnamese Work Permit before they commence or undertake any work in Vietnam, unless they are covered by an exemption category. This also means that foreign individuals need a Work Permit even during probation periods.
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We see successful clients as a measure of our success, and the best source of our own growth.