Mandatory annual reports for a foreign representative office in Vietnam on its operations, within permitted activities is the required procedure for foreign traders who are executing the registered representative office in Vietnam. The foreign traders shall submit the annual reports to licensing authorities on time in proper form and content.
Vietnam-based representative office of a foreign investor means a dependent unit, a lawful office in Vietnam, allowed to recruit staff to manage and promote sale contracts with local business partners, research and develop products, seeking opportunities for the purchase or sale of goods and provision of services. A foreign representative office is a simple form of investment in Vietnam to enhance business from overseas, with multiple advantages while fewer risks regarding the required business compliance procedures such as investment capital, tax, accounting, and auditing. And it is easy to be extended or terminated or dissolved. The expatriate employees who work for representative office can obtain work permit and two years multiple visa (temporary residence card) for themselves and their family in Vietnam.
WHY THE ANNUAL OPERATION REPORT?
- According to local laws, by January 30th of the following year, every representative office shall deliver in person or mail the annual report on its operations to the licensing agency.
- Also, upon the request of competent state regulatory authorities, a representative office shall submit operation reports, documents, and other explanatory information, which are kept at its office for its license renewal/revision during its operation.
WHAT CONTENT IN THE ANNUAL OPERATION REPORT?
Labor use and employment relations:
- Reports on local employees. Reports on foreign employees.
- Total income. Compulsory insurance. Personal income tax.
- Newly joined and termination of labor relations.
Operations of the representative office:
- Commercial activities. Manage and promote local business contracts.
- Market research. Develop products. Seek opportunities for the purchase or sale of goods and provision of services… and notes on other activities.
THE RISKS AND VIOLATIONS SHALL BE AVOIDED AND PREVENTED?
- Failure to submit the operation reports on time may lead to a penalty of up to 40 million VND.
- There will be a special inspection on many other required compliance procedures from local competent state agencies such as the Tax Department, Labor Department, and Licensing Department…
- The contents of the report may conflict with the office’s functions, especially show violations on labor declaration, personal income tax declaration and settlement.. and also impact your good standing, your office license renewal and other procedures in years ahead.
ONE-STOP SOLUTION FROM VIVA BUSINESS CONSULTING
- Review the general activities. Identify the risks and solutions.
- Review business records and required compliance reports on labor use and employment relations, required compliance reports personal income tax, and required compliance reports for the chief and expats.
- Prepare proper and optimal reports, prevent any violation in advance, keep your good standing, and enhance more incentives for licensing renewal and other required compliances during office operation.
- Representative on behalf of the company to explain and settle for any query or requirement from the related competent state agencies.
Read more:
- Annual operation reports for foreign representative offices
- How to manage the annual operation reports
- Manage the annual operation reports
- Representative office in Vietnam – Business records management
- Representative office in Vietnam – Manage tax declaration and settlement
- Representative office in Vietnam – How to manage the annual operation reports
- Representative office in Vietnam – Risk management on operation
- Representative office in Vietnam – Cashbook and lawful invoices for tax inspection
- Representative office in Vietnam – Annual budget and running cost
- Representative office in Vietnam – Business compliance advisory services
- Representative office in Vietnam – manage the annual required compliance procedures
- Personal income tax 2023 for foreign investors – managers – experts in Vietnam
