How to close foreign invested company in Vietnam? Firstly, you shall prepare for the official dissolution decision and applications and submit to the competent state agencies for closuring any further obligation. This stage aims to suspend, terminate any new obligation, especially for the tax reports and other compliance procedures. From the date of proper notice to the local competent state agencies, the company is in closured standby status.
THERE ARE 03 KEY STEPS TO CLOSE FOREIGN INVESTED COMPANY IN VIETNAM
Step 1: Dissolution decision and registration
Preparing for the official dissolution decision and applications, submit to the competent state agencies for closing any further obligation. This step aims to suspend, terminate any new obligation, especially for the tax reports and other compliance procedures. From the date of proper notice to the local competent state agencies, the business entity is in closure standby status.
Step 2: Debts and obligations completion certificates
To collect, complete the compliance business records and arrange for any certificate of obligations completion. Especially in the liquidation and completion of employment, taxes, compulsory insurances. This is legal requirement to guarantee that the business entity has no more pending obligation before being allowed to close under legal procedures.
Step 3: Final paperwork
Upon the certificates of obligations completion, the business entity will close the bank accounts, return the IRC, ERC, legal stamp as final step dissolution. This is the final paperwork as completed.
In which, Step 2 is most complicated because of tax inspection procedures and employment liquidation. The tax inspectors will review all the business records, tax reports, accounting books, financial statements, invoices, tax payments… before issuing the tax completion certificate. The employees and Labor agency may request you to pay more allowances and compensation before signing a liquidation agreement… We can support you to manage and settle step by step in the proper and optimal manner, until the dissolution is completed.
Our tips:
TAX INSPECTION PROCEDURES
- Pursuant to the tax regulations and anti-money laundering laws, since years 2012, after every 3 to 5 years of office operation, the Department of Taxation may require any company to provide the accounting books, invoices, bank statements, employee profiles as well as payroll vouchers and together with lawful documents for tax inspection.
- Tax officers will review each transaction to ensure that the company’s expenditures have been made legally and duly, without violating the tax or anti-money laundering laws. In addition, in case of dissolution, before the office’s closing, the tax authorities will also carry out similar tax inspection for final settlement procedures.
LIQUIDATION OF EMPLOYMENT
Termination agreement
- Compulsory insurances settlement, personal income tax settlement.
- Job-loss allowances and others.
- Decision of termination.
- Hand over minutes.
- Liquidation minutes / agreement.
Final settlement personal income tax for local employees
- Calculating optimal tax payable amount.
- Final declaration and settlement.
- Letter of confirmation for the paid incomes and issue the tax receipt.
- Manage and settle any query or question from tax department until obtaining the tax completion certificate.
Final settlement personal income tax for expats
- Calculating optimal tax payable amount.
- Preparing the settlement sheets for final declaration and settlement in case of the foreigner complete the jobs and leave from Vietnam.
- Submitting final declaration and settlement, on behalf to pay the tax payable amount.
- Manage and settle any query or question from tax department until obtaining the tax completion certificate.
HOW VIVA CAN HELP
We can provide a full package or every single concern of close foreign invested company in Vietnam upon request:
- Advising for the required papers, info, procedures.
- Preparing checklists to collect the required papers, info from teams.
- Preparing for the official dissolution decision and applications and submit to the competent state agencies for close foreign invested company any further obligation. This stage aims to suspend, terminate any new obligation, especially for the tax reports and other compliance procedures. From the date of proper notice to the local competent state agencies, the company is in closured standby status.
- Collect, complete the compliance business records and arrange for any certificates of obligation completion. Especially for the liquidation of employment, the certificate of tax, social insurance, customs completion. This is legal requirement to guarantee that the company has no more pending obligation before allowed to closure under legal procedures. Unless some special reason from the competent state agencies,
- Internal audit for the compliance business records, identify the exists and potential risks according to the tax inspection procedures and others. Prepare management letter to the Board of directors with correction actions.
- Delegate professional teams to support and together fixing the business records, remove any exist and potential risk, optimize the tax re-collection and fines payable amount.
- Arrange special tax settlement procedures with the officers that you can obtain the tax completion certificate in a simple manner and within reasonable/ estimable budget.
- Prepare necessary applications, notices and submit to the competence state agencies. Follow up and settle any related query or requirement until completion.
- Obtain the tax completion certificate, return the office license, close the bank accounts, return the round stamp. Upon the certificates of obligation completion, support to closure the bank accounts, return the business licenses, return the legal stamp as final step of closuring foreign invested company. This is the final paperwork as completion.
- Destructure the business records with proper procedures.
- Collecting related papers and dossiers above for compliance business records management.
Read more relevant content on enterprises dissolution in Vietnam:
- Shutdown and dissolution procedures – of enterprises and branches in Vietnam
- Cases of and conditions for shutting down and dissolution – of enterprises and branches in Vietnam
- Shutting down and dissolution procedures – of enterprises and branches in Vietnam
- Application for shutting down and dissolution – of enterprises and branches in Vietnam
- Actions prohibited when shutdown and dissolution procedures – of enterprises and branches in Vietnam
Read more:
- Register a company in Vietnam
- Establish a representative office of an enterprise in Vietnam
- Investment in Vietnam – How to set up a representative office?
- Foreign direct investment in Vietnam: What you need to know
- Business records management
- Investment in Vietnam – how to buy or sell a company
- Why choose representative office or subsidiary?
- Account for payment, withdrawals capital of foreigners who invest directly in Vietnam
- Personal income tax for foreign employees: methods of declaration and payable amount
- Foreign representative offices in Vietnam – Tax management
- Closure a foreign representative office: Tax final settlement and tax completion certificate
- Representative office vs subsidiary vs branch? How to transform business models in Vietnam?
